Do you want to start a spray tanning company from home? If YES, here is a complete guide to starting a spray tanning business with NO money and no experience plus a sample spray tanning business plan template. Starting a business is perhaps one of the best decisions you can make. When you decide to start a business, it means you have identified people’s need and have thought out how to provide solutions to those needs.
Therefore, if you desire a business with low startup capital and significant profit margin, then you should consider starting a spray tanning business. A spray tanning business is one of those businesses that could be run comfortably from your home. Spray tanning has other names like sunless tanning, UV – free tanning, or self-tanning. Spray tanning business is a beauty therapy business which has to do with the application of chemicals to the skin to produce a suntan effect.
The spray tanning business is a lucrative business that could be started by anybody without much stress. All you would need to start-up your spray tanning business is a little training about the business and your spray tanning starter kit. This article would give you all the necessary details needed for you to start-up your spray tanning business.
18 Steps to Starting a Spray Tanning Business from Home
Table of Content
- 2. Conduct Market Research and Feasibility Studies
- 3. Decide Which Niche to Concentrate On
- 4. Know Your Major Competitors in the Industry
- 5. Decide Whether to Buy a Franchise or Start from Scratch
- 9. Discuss with an Agent to Know the Best Insurance Policies for You
- 10. Protect your Intellectual Property With Trademark, Copyrights, Patents
- 11. Get the Necessary Professional Certification
- 12. Get the Necessary Legal Documents You Need to Operate
- 13. Raise the Needed Startup Capital
- 14. Choose a Suitable Location for your Business
- 15. Hire Employees for your Technical and Manpower Needs
- 16. Write a Marketing Plan Packed with ideas & Strategies
- 17. Develop Iron-clad Competitive Strategies to Help You Win
- 18. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
1. Understand the Industry
In the spray tanning business, it is important to note that there are no companies with a dominant market share in this industry. The industry is estimated to generate revenue of about $2bn with an annual growth rate of 2.6% between the years 2012 to 2017.
There are about 13,586 saloons that offer tanning services in the united states of America. The industry has employed about 35,570 people in its workforce. Increase in disposable incomes will further encourage consumers to spend on tanning salons.
The spray tanning industry in the US has grown considerably over the past five years as consumers have become wealthier due to the high rate of employment. This positive trend has led to rising per capita income and consumer confidence.
Consequently, there has also been an increase in the demand for personal services and other luxury services as consumers increase their spending on optional items and services.
However, in 2017, rising health concerns are expected to affect the demand for this service. More income is expected from the tanning salons industry as more revenue is generated through the sale of sunless tanning beds and merchandise. This is expected to cater for consumers looking to make luxury purchases.
The economic life cycle of the Tanning Salons industry is in its mature stage. The industry is considered to have experienced growth in line with the overall economy. The industry has experienced exponential grown over the past five years due to increase in disposable income and consumer confidence. This has further been translated into greater demand for personal care services and luxury products.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographic composition of people that need spray tanning services is not restricted to a particular location. It cuts across people of different disposable income. However, the demand for spray tanning is highest among people with high income.
So, if you want to define the demographics of your spray tanning business, then you should ensure you make your service readily available and affordable for every class of people. Your service should cut across the different geographical regions.
3. Decide Which Niche to Concentrate On
There are several areas in the spray tanning industry that you can diversify to gain more customers and make a profit. They are all closely related to the spray tanning business. Here are some of the ideas you can specialize in within the spray tanning business;
- UV tanning
- Sunless tanning
- Providing spray-on tanning services
- Merchandise sales
- Providing UV tanning services
- Providing body contour tanning services
- Industry Activities
- Providing airbrush tanning services
The Level of Competition in the Industry
The spray tanning industry is no doubt a business with huge growth potential, but it is also a competitive industry. Anyone can venture into this business as there are no entry barriers in the business.
Distance is also not a barrier in this business when competing for clients as all your customers will demand from you is high-quality spray tanning service with a satisfactory outcome. Your business will also stand out above your competitors when your prices are relatively lower. Once your customers are satisfied with your service delivery, then you would enjoy more patronage, and within a short while you would be raking in more profit.
There are other spray tanning salons scattered all around the United States, so if you intend to start your own spray tanning business in the United States, you will meet stiff competitors in the course of the business.
4. Know Your Major Competitors in the Industry
In every industry, there are always brands that are well known for excellent service, and they are better regarded by customers and the general public than others. Some of these brands have been around the industry for a while and so are known for quality service delivery. Here are some of the leading spray tanning salons in the United States of America;
- Portofino Sun Centre
- Future Tan’s Tanning Spa
- Beach Bum Tanning Union Square
- Urban Tanz
- Salon 25
- NY Sun Club Tanning & Airbrush
- Future Tan Midtown
- Park Slope Tanning
You would need to carry out a feasibility study before starting the spray tanning business. There are many other factors to consider to avoid failing in this business. One of the most important factors you need to consider is how to build an outstanding brand.
You would need to study your competitors to know their strengths, weakness and know where to capitalize on. You should also maximize your strength for business growth. You need to make your brand unique and attractive enough for your customers to notice and patronize you. You will also need a well-detailed business plan to know if your Business model is viable or not.
Another thing to consider is your finance and how to source for start-up capital. This is an important component of your economic analysis as most major financial institutions will be more willing to lend to an already established and successful spray tanning business rather than a start-up. Therefore, if you would need a loan to start up your business, you have to ensure your business plan is interesting and well-detailed to enable you to convince the lending institution for a loan.
5. Decide Whether to Buy a Franchise or Start from Scratch
Your choice of business model will be determined by your vision and mission statement. For instance, if you decide to make quick money from your business and you have the financial clout to go with it, then you can consider buying a successful franchise in the spray tanning industry.
However, if you plan to build your brand to grow at your own pace from one location in the city to another till you grow throughout the United States and around the world, and then starting the business from scratch will be your best option.
Starting a spray tanning business from scratch comes with less financial risk than buying a franchise as a franchise might not be as profitable as you have imagined it to be. That is why it is most advisable to start from the scratch and grow the business at your pace.
6. Know the Possible Threats and Challenges You Will Face
The threats and challenges you will likely face in the course of running your spray tanning business have to do with competing with already established spray tanning brands. Plus you are likely going to face stiff competition from new spray tanning shops that opened at the same location as yours. You need to devise strategies to nullify these threats and challenges while you compete for the available clients in the location you decide to set up your spray tanning business.
Other threats and challenges you will face when you are starting your spray tanning business include; global economic downturn which mostly affects your customer’s purchasing/spending power, and unfavorable government policies as there is a continued increase in health concerns regarding skin cancer risk.
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
When you are planning to start your spray tanning company, what should be on your mind is how to choose the appropriate legal entity for your business. This is because the legal entity will go a long way to determine how big and successful your business can be. So, it is very important to get your legal entity right.
There are several legal entities to choose from namely; general partnership, Limited Liability Company, and sole proprietorship. Each of this legal entity has its merits and demerits, for instance, the general partnership will be ideal for a small – scale spray tanning company which hopes to start with a moderate start-up capital. However, it is not preferred because there is no limitation of liability in case you encounter unexpected loss in the business.
Therefore, the Limited Liability Company (LLC) is most preferred for this kind of business as it encourages growth without fear of liability. This is because if any liability is incurred in the course of the business, it is only the money that you invested into the limited liability company that will be at risk. This is what differentiates it from the sole proprietorship and general partnership.
Limited liability companies are more flexible and simpler to operate as you won’t need a board of directors and other managerial formalities to operate.
These are some of the factors you would also need to consider before you choose a legal entity for your spray tanning company; limitation of personal liability, ease of transferability, taxes, admission of new owners and investors’ expectation.
There is no gain saying that the limited liability company is the most ideal for your spray tanning business. You can start your spray tanning business as limited liability company and convert it to a ‘C’ corporation or an ‘S’ corporation in the future especially when you plan to go public.
Upgrading your business legal structure to a ‘C’ corporation or ‘S’ corporation will give you ample opportunity to grow your spray tanning company to compete with major players in the industry; you will enjoy separate tax structures, you will be able to generate capital from venture capital firms, you can easily transfer company ownership; and you will enjoy flexibility in ownership and management structures.
8. Choose a Catchy Business Name
When you want to choose a suitable for your business, it is important for you to choose a name that will indicate your type of business. Your business name will make it easier for customers to associate with your brand. Here are some catchy business names you can select from when you want to start your spray tanning business.
- Glitterz tanning spa
- Saloon 365 spa
- Spotless tanning saloon
- Blitz tanning saloon
9. Discuss with an Agent to Know the Best Insurance Policies for You
The standard policy in most countries and the United States requires that you have some of the basic insurance policy covers that are required by the industry you want to operate from. So, you need to create a budget to support your insurance policy covers, and perhaps you might need to consult an insurance broker to guide you in choosing the most appropriate insurance policies for your spray tanning company.
Here are some of the basic insurance policy covers needed for you to start your own spray tanning company in the United States of America;
- General insurance
- Liability insurance
- Health insurance
- Overhead expense disability insurance
- Employment Practices Liability Insurance
- Business owner’s policy group insurance
- Workers Compensation Payment protection insurance
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
If your business model requires you to buy a spray tanning franchise, then you may need to also file for intellectual property protection as it will be very useful when your spray tanning brand starts to expand. If you are starting from the scratch, you can still file for trademark to protect your business logo, and other images/documents peculiar to your business. To register your trademark, all you need do is to apply with the USPTO.
11. Get the Necessary Professional Certification
You do not need any professional certification to legally run your spray tanning business in the United States of America. It is a business that is open to both the skilled and the unskilled; learned and the unlearned. Though, it is essential for anyone that wants to venture into this business to have basic knowledge about spray tanning. But you do not need any professional certification to run your spray tanning successfully.
12. Get the Necessary Legal Documents You Need to Operate
It is very important for business owners in the United States of America to have the necessary legal documents in place before launching their businesses. It is a known fact that you cannot successfully run your business in the United States without having the right documentations. Therefore you have to meet the minimum requirements as to the legal documents to have.
Here are some of the essential legal documents you need to have to legally run your spray tanning company in the United States of America;
- Business License and Certification
- Business Plan
- Insurance Policy
- Federal tax identification number
- Certificate of Incorporation
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Apostille (for those intending to operating the business beyond the United States of America)
- VAT registration
13. Raise the Needed Startup Capital
We all know that every new business comes with its financial outlay which varies from one business to another. Therefore, to finance your business, one of the first things and perhaps the major factor to consider is to write a good business plan.
With a good and workable business plan in place, you will easily find investors that will be interested in your business and provide you with the necessary funds for startup. Also, you would find it easier to convince your bank for a loan for your business. Here are some of the options you can explore to get capital to start up your spray tanning company;
- Raise money from personal savings and sale of properties and personal stocks
- Raise money from business partners and investors
- Applying for Loan from your Bank
- Sell shares to interested investors
- Apply for business grants and seed funding from donor organizations and angel investors
- Source for soft loans from your friends and family members
14. Choose a Suitable Location for your Business
Spray tanning business needs to be sited close to where your target customers reside. This is not a business that can be run from the comfort of your home because you need somewhere spacious enough for your customers to feel comfortable.
A good location for your spray tanning business should be accessible with enough parking space due to the caliber of customers you want to attract. Location is key to the overall success of this business.
When choosing a location, you need to identify areas with a good flow of traffic and sufficient residential and commercial population. If you decide to site your spray tanning facility in a not too visible location simply because it is cheap, then you will need to spend more money to advertise your business and give directions to potential clients.
It is also necessary to note that siting a business facility in a good and visible location does not come cheap; therefore you should budget sufficient fund for leasing/renting. If you have challenges with choosing the right location for your spray tanning business, then you should consult a business consultant or a realtor with sufficient knowledge about the city you intend starting your spray tanning business.
15. Hire Employees for your Technical and Manpower Needs
This business requires that you get the necessary equipment to start your spray tanning salon. As you begin to have regular sales and customers, you should look to acquire some latest technological equipment. This should be included in your business plan from the onset to enable you raise sufficient capital. Aside from the technical aspect of the business, the human resources aspect is also important.
You will need to hire a competent and qualified spray tanning salon director, but you can also fill in this position. The overall success of the business depends on the quality of the staff at your disposal. You need a minimum of 4-7 staff to assist you in starting this business on a small scale.
The Service Delivery Process of the Business
A seamless service delivery process must be designed to give your customers excellent service. To deliver a quality and excellent service to your customers, you need to put some things into consideration such as; hiring the best possible hands, focusing on customer satisfaction, and getting customer feedback to improve on services rendered. All this should be done at a relatively small price when compared to that of your competitors.
16. Write a Marketing Plan Packed with ideas & Strategies
As a spray tanning business owner, you would have to prove yourself before people can have confidence in your services. So, if you have plans to start your spray tanning business, you should ensure you deliver excellent service to your customers.
People will patronize your spray tanning business if they are assured they will get good value for their money. So, when you are drafting your marketing plans and strategies, ensure that you create a compelling personal and professional profile. Here are some of the marketing platforms you can utilize for your spray tanning business;
- Introduce your business by sending introductory letters along with your brochure to corporate organizations, international business and small-scale businesses in the United States
- Advertise your business in relevant beauty magazines, radio stations and TV stations
- Attend international expos, seminars, and fairs related to your business
- Create packages to accommodate different category of clients in order to work with their budgets
- Make use of the internet to promote your business
- Create a blog where you write on key issues as it relates to your business; this will make people consider you an expert in the field
- List your business on local directories
- Employ the services of business developers and marketing executives to carry out direct marketing
17. Develop Iron-clad Competitive Strategies to Help You Win
The Spray Tanning Business industry has its fair share of competitors, and you must have a unique and highly creative strategy to outsmart your competitors in the industry. Part of the actions to take to stay competitive in the spray tanning industry is to continue to render excellent and affordable service. People will always come to you if they know that you will give them the best results as regards to skin tanning.
Another strategy to adopt is to employ competent and professional hands to help you handle your spray tanning business.
18. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
If you are into any business, your sole aim should be about boosting your brand awareness and communicating your corporate identity. This is essential if you want people to know your business and what it stands for. One of the secrets of larger corporations is their willingness to spend fortunes to boost their brand awareness.
If you intend to grow your spray tanning business beyond the city where you are going to be operating from to become a national and international brand, then you need to spend a part of your budget on promotion and advertisement of your brand.
To promote your brand and corporate identity, you should take advantage of the print media, electronic media and social media. It is important to note that the social media is a cost-effective way to promote your brand, as it is very effective and with a wide reach.
Below are the ways you can boost your brand awareness and advertise your business;
- Place adverts in relevant magazines and related newspapers, TV and radio stations.
- Encourage the use of word of mouth publicity from your loyal customers
- Make good use of social media platforms like Facebook, Twitter, YouTube, Instagram, LinkedIn, Snapchat, etc., to promote your business.
- Advertise your business by placing banners and billboards in strategic positions all around your city
- Distribute your handbills and fliers in target areas in and around your business area
- Contact corporate organizations, international businesses and small businesses to inform them of your company and what you offer
- Advertise your business in your website and find ways to pull traffic to the site
- If you have official cars, ensure they are well branded with the company’s color while you also make it a policy for your staff members and management staff to wear your branded shirt or cap at regular intervals