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Setting up a Hairdressing Business

All you need to know about starting and running your business

Business guides » Setting up a Hairdressing Business

What is a Hairdressing Business?

The hairdressing and beauty industry has grown a huge 54% in the last five years. With more than 45,000 hair and beauty businesses now operating in the UK, you may be wondering whether opening a hairdressing business is likely to be profitable.

Luckily, hairdressing businesses continue to be highly popular in the UK.

A hairdresser is a specialist in cutting, trimming, styling, grooming and colouring hair. Hairdressers may also offer blow-dries, perms, relaxers and hair extensions. A hairdresser will likely offer consultations where they discuss the client’s vision and preferred style and then offer advice based on the client’s hair type, face shape, lifestyle and other physical features.

If you are thinking of starting up a hairdressing business, you have several options available to you:

      • Open an independent hairdressing salon.
      • Open a large, national salon or franchise.
      • Hire a hairdressing chair in an already set up salon.
      • Run an at-home hairdressing business.
      • Run a mobile hairdressing business.

 

You can choose to offer general hairdressing services and treatments or specialise in one specific type of service.

For example:

      • A natural hairstylist.
      • A wigmaker.
      • A specialist hair colourist.
      • hair extension expert.
      • A curly hair specialist.
      • A weave specialist.
      • A formal hairstylist (e.g. for weddings).

 

You can choose to operate your hairdressing business independently or hire other hairdressers, either on a freelance or fully employed basis.

Hairdressing businesses operate by providing one or more services or treatments to their clients. The client will then pay for the service. Many hairdressing businesses succeed as a result of repeat business and customer recommendations.

As part of your business, you will need to utilise hair equipment and hair products. Ensuring the safety of these items is paramount. You may also choose to offer the hair products you use for sale.

A hairdressing business can be a financially and emotionally rewarding venture. It can be financially rewarding as there is the potential to earn a high income. If you have a genuine passion for hairdressing and enjoy working directly with your clients, hairdressing can also be emotionally rewarding.

If you are considering starting up a hairdressing business, you will need to ensure you perfect your skills and can offer a high-quality service. In order to make your business a success, you will also need to have a passion for hairdressing and a flair for business. A genuine interest in your customers and good listening skills are also key to ensuring you provide the service they really want.

If you are a sociable person who enjoys working face-to-face, have strong hairdressing skills and have a solid business plan, a hairdressing business could be an extremely lucrative option.

Types of Customers

People of all ages and demographics utilise hairdressers. However, different types of hairdressing businesses are likely to attract different clients.

Determining the type of customers your business is likely to attract can help you to plan your advertising and marketing strategy and maximise your profits.

Your typical customer base will depend on several factors:

The services and treatments you offer

This is one of the most important factors that will determine your typical customer base. If you offer generic hair services and treatments you may not have a specific demographic. However, specific hair treatments are likely to appeal to different customers. For example, a perm specialist may attract older customers, whereas hair extensions are more likely to attract younger clients.

Your location

Most people choose a hairdressing business that is conveniently located to where they live or work. Your location will have a significant impact on the customers you attract. If you are located in a city or town centre, you may attract local professionals who work in the area, whereas if you are located in a residential area, your clients are more likely to be people who live locally.

Your price points

Your pricing strategy will significantly impact your customer base. Some people may be willing to pay higher prices for superior services, whereas others may prefer budget-friendly hairdressing. When considering your pricing, take into account your equipment, the products you use, your location and your local competition.

Your business brand and aesthetic

Your branding and aesthetic are key to attracting customers. Your business name, logo and the design of your salon or mobile business are all key to the types of clients your business will have.

Hair Dye Cartoon
Haircut Cartoon
Hairdryer Cartoon

Equipment You Will Need

Hairdressing businesses require specific equipment in order to operate successfully. You may have different equipment requirements depending on the types of treatments and services you offer.

The type of hairdressing business you run will also affect your equipment requirements.

Consult the list below to determine your business’s equipment necessities.

Salon furniture and equipment

If you run a hairdressing salon, there will be various items of furniture and equipment you will need:

Reception area

For your reception area, you will likely need:

  • A reception desk and chair.
  • A laptop or computer.
  • A telephone.
  • An appointment book or scheduling software on your computer.
  • A cash register and Point of Sale (POS) system.
  • Business cards and appointment cards.
  • Pricing signs and opening hours signs.
  • Shelving for displaying products.
  • Magazine racks.

 

Salon chairs

Different types of chairs will be required, depending on the type of treatment you are providing. You can choose chairs that recline, raise and lower, or swivel. The chairs should be comfortable for your clients and easy for you to clean and maintain. Prices range from £200 to £1,000, although you may receive a discount if you purchase multiple chairs.

Backwash units

A backwash unit is a type of reclining chair attached to a sink. They are used for washing hair and rinsing dyes and other products out of a client’s hair. Depending on the size of your salon, you may need multiple backwash units. They typically retail for between £400 and £700 each.

Styling units

Styling units are professionally installed in your salon. They are the area where haircuts and styling take place. You may choose built-in wall units, island units or tables. You may also choose to incorporate shelving, cupboards or drawers into your styling area. You can expect to pay between £500 and £2,000 for your styling areas, depending on the type of areas you choose and the installation costs.

Mirrors

Mirrors will be installed as part of your styling unit to allow customers to see their hairstyles. You may also need handheld mirrors to show customers the back of their hair.

Couches or chairs

If you have the space, you may want to have a waiting area for any clients that arrive early or in the event your appointments overrun. You could use couches or chairs in your waiting area.

Beauty trolleys

Beauty trolleys can help you keep all your main equipment close by. You can move your equipment around the salon more easily and reduce the amount of lifting and carrying you need to do. Beauty trolleys usually have shelves or compartments for storing different items. They can typically be purchased for between £80 and £500.

Cleaning equipment

Maintaining a high level of cleanliness is essential for your hairdressing business. You will need to wipe down chairs, equipment and surfaces between each client and ensure your salon is clean at all times. Some cleaning equipment you may need includes a sweeping brush or hoover, a mop, disinfectant, cloths, sponges and cleaning products.

Hairdressing equipment

Regardless of the type of hairdressing business you run, hairdressing equipment is an essential requirement.

Some hairdressing equipment your business may need includes:

Electrical equipment

Some of the electricals you will need are hairdryers, straighteners, curling wands, clippers and electric razors. You will likely need one set of electricals for every styling unit.

Hairdressing scissors

You may need scissors of different sizes and shapes for different hairstyles. Each styling unit will need its own set of scissors. Each pair of hairdressing scissors can cost between £50 and £175.

Hairdressing towels and gowns

These are used to protect your clients’ clothes and shoes. Ensure you have multiple towels and gowns as you may need to clean them between each client.

PPE for you and your staff

You may require personal protective equipment (PPE) including gloves, aprons and face coverings to protect you and your staff and to ensure your hairdressing business operates hygienically.

Combs and brushes

These can be used for brushing, detangling and styling hair.

Hair colour supplies

Some of the colouring products you may need include various dyes, peroxides, bleaches, foil, mixing bowls and brushes. You will likely need to replace these products regularly.

Hair products

The types of products you will need will vary depending on the treatments you offer. You will likely have to purchase multiple types of products for the same treatments to account for your clients’ needs and any allergies or sensitivities. You may be able to purchase the products directly from the manufacturer or buy them in bulk to save money.

Hair extension equipment

If you decide to offer hair extensions, some of your equipment requirements will include heat connectors and heat guards, pliers, scissors, keratin glue and a hair extension trolley. You will also need hair extensions in a variety of colours and lengths.

Hairdressing

Typical Pricing

When starting up a hairdressing business, you will need to calculate the approximated start-up costs and running costs. This can help you to plan your investment and pricing strategy and maximise your profits.

Some of the costs you can expect from your hairdressing business include:

Equipment costs

The cost of equipment can vary based on how much equipment you require. The bigger your hairdressing business is, the more equipment you will require. You may choose to purchase less equipment initially and expand your equipment as your business grows. You could also choose to rent some of your equipment rather than buy it. Purchasing equipment could cost between £3,000 and £30,000.

A hairdressing salon or other premises

If you choose to open a salon, your premises will be your biggest expenditure. The price of your premises will vary significantly depending on the size and location. Rental costs are usually calculated per square metre and can range significantly, from £500 to £15,000 per square metre annually, depending on the location.

Renovation and installation costs

You will likely need to renovate or refurbish your premises to incorporate the furniture and equipment you need for your hairdressing business. You may also want to design and decorate your premises to fit the aesthetic of your brand and make your business more attractive to customers. Renovation costs can vary, depending on the level and scale of work required.

Maintaining, repairing and replacing equipment

Repairs, maintenance and replacements are ongoing costs you will need to factor into your budget. Correctly cleaning and maintaining equipment and ensuring it is used correctly can extend its life, but repairs and replacements are still inevitable.

Replenishing hair products

Any hair products you use in your hairdressing business will need to be replenished regularly. You may need to order more products weekly or monthly, depending on how many treatments you do.

Staff

You may initially operate your business independently and then hire staff as your business grows. You could hire staff as permanent employees or as independent freelancers. If you hire staff permanently, you will need to pay them at least the national minimum wage of £9.50 per hour and account for other expenses such as holiday pay, sick pay and maternity/paternity pay.

Running costs

The running costs associated with your hairdressing business could include electricity, gas, water and council tax. If you operate a mobile business, you will also need to incorporate the costs associated with your vehicle including petrol, MOTs, services and insurance.

Branding

Branding can help you to establish your business’s identity and set you apart from your competition. Branding could include creating your business’s visual identity, a logo, your business name, and creating your business’s website. You can hire a professional to help you with branding or do some of the work yourself. Branding can cost between £500 and £10,000, depending on the amount of branding you require.

Marketing and advertising

This can help you to grow your business. You may require more advertising and marketing when your business first launches. It is recommended that you spend no more than 10% of your annual revenue on advertising costs. You may be able to reduce your advertising costs by utilising social media.

Business insurance

Your hairdressing business will have several insurance requirements, including:

      • Public Liability Insurance.
      • Building, Contents, Stock and Tools Insurance.
      • Employers’ Liability.
      • Products Liability Cover.
      • Personal Accident Cover.
      • Legal Expenses Insurance.

       

      Once you have calculated the costs associated with setting up and running your hairdressing business, you can then determine your pricing policy.

      Your pricing policy is the prices you will charge for the different services and treatments you offer.

      Several factors will influence your pricing strategy:

          • The types of services and treatments you offer.
          • The location of your business.
          • Whether you operate in a salon, at home or mobile.
          • The equipment and hair products you use.
          • Your local competition.
          • The training, qualifications, and experience of you and your staff.
          • Your expenses.

           

Safely Running a Hairdressing Business

As you are working with potentially dangerous equipment, electricity and products that contain chemicals, safe practices are paramount in your hairdressing business.

Some ways you can safely run your hairdressing business are:

Obtain the relevant qualifications

Although hairdressers in the UK don’t require any specific qualifications, obtaining them can help you ensure safe practices and make your business more attractive to potential clients. National Vocation Qualifications (NVQs) are available up to Level 4 in hairdressing. You could also obtain a Salon Management Qualification.

Ensure staff have health and safety training

This can help to ensure safe practices at all times, even if you are not present. Your staff could undergo training on Fire Safety, COSHH Awareness, Electrical Safety Awareness, and Covid-19 Awareness. You can see a full list of health and safety training courses on our website.

Conduct risk assessments

Risk assessments are only legally required for businesses with more than five employees. However, even if you have fewer employees, risk assessments can help you to identify any potential risks or hazards and then implement any necessary safety measures.

Keep sharp instruments and chemicals out of customers’ reach

You may have children or vulnerable adults on your premises so keeping any potentially dangerous items out of reach is a good way to ensure safety. It is also important to make sure that sharp objects, such as scissors, can not fall or cause accidental injury to any staff or customers.

Hairdresser Tools
Hairdresser

Always read the manufacturers’ instructions

Reading the manufacturers’ instructions is imperative when you work with chemicals and other potentially harmful products. Follow the instructions carefully and abide by the use-by dates on the label.

Safely store and dispose of products

Ensure all products are stored in a temperature-controlled area and are covered, with no risk of leaks, spillages or contamination. Any particularly hazardous products should be kept away from customers. You must also dispose of products safely.

Pay attention to noise hazards

Noise levels can sometimes be high in a hairdressing business, especially if multiple hairdryers are operating at the same time. Measure noise levels and make sure you are aware if noise levels are too high.

Implement cleaning procedures

Having effective cleaning procedures is essential for your hairdressing business. You will be working with multiple clients a day and using chemicals. Human hair can also be hazardous if not cleaned correctly. A cleaning schedule and cleaning policies should be in place and should refer to the cleaning of furniture, equipment and surfaces. You should also implement handwashing procedures.

Implement emergency procedures

Emergency procedures are necessary in the event of a fire, floods, explosions, chemical spills and terrorist incidents. You may need to comply with already set-out emergency procedures or create your own. Ensure that the procedures are displayed in an easily accessible location.

Implement security measures

To protect your business from break-ins and potential thefts, ensure your stock is safely stored and your salon is secure. You could install a CCTV system, a reliable lock, and an alarm system to help protect your business.

Legal Requirements

When running your hairdressing business, there are several legal requirements you must ensure you comply with. Ensuring you are aware of and following all legal requirements helps to protect you and your business.

Failure to follow legal requirements could be damaging to both you and your business. You could receive a warning, a fine or even face prosecution.

Some of the legal requirements you must ensure you comply with are:

The Health and Safety at Work etc. Act 1974

This Act lays out the duties of all employers in the UK in regard to ensuring the health, safety and welfare of everyone in your workplace. As you are the business owner, you will be responsible for protecting the health and safety of your employees and any clients or visitors to your business.

Control of Substances Hazardous to Health (COSHH) 2002

COSHH is the law that states that you (the business owner) must control any substances that could be potentially hazardous to health. You must assess, control and reduce any risks or potential hazards and protect individuals from harm. Some of the potentially hazardous substances could include chemicals in hair dye and other products, and naturally occurring substances, such as mould and bacteria.

The Reporting of Injuries, Diseases and Dangerous Occurrences Regulations (RIDDOR) 2013

RIDDOR states that you must report all injuries, diseases and dangerous events that occur in your business. Reports must be made to the Health and Safety Executive (HSE) using an appropriate recording document.

Cosmetic Products (Safety) Regulations 2008

These regulations apply to any products or substances that come into contact with the human body, including the hair. You must not use any products that could cause harm to a person’s health or use any products that contain prohibited substances. You must also comply with the regulations on labelling and animal testing.

The Electricity at Work Regulations 1989

The Electricity at Work Regulations state that any workplaces that use electricals must construct electrical systems in a way that prevents danger, maintain electrical systems to ensure they are safe, ensure electrical equipment is checked by a competent person annually and conduct Portable Appliance Tests (PAT).

The Manual Handling Operations Regulations 1992

Manual handling regulations can help to protect you and your employees from sustaining an injury or illness as a result of manual handling tasks. The regulations apply to the lifting or moving of any objects or people, bending down and reaching high and repetitive movements. For more information on manual handling regulations, visit our knowledge base.

Appoint a first-aider

All workplaces, including hairdressing businesses, must have an appointed first-aider. In the event of an accident or injury, they will then be able to administer the necessary first aid. Although a first aid qualification or certificate is not legally required, it is the easiest way to demonstrate your first aid training.

Implement health and safety policies

It is legally required that all workplaces have health and safety policies. These policies should help to manage health and safety in your business and should be clearly displayed for your employees to view.

Conduct allergy tests

An allergy patch test should be standard practice in your hairdressing business. If a customer is having a colour applied to their hair, they must come in for an allergy patch test on their skin 48 hours before their treatment, even if they have used hair dye previously.

Use appropriate PPE

Personal protective equipment (PPE) is a legal requirement for hairdressing businesses. It can help protect the health and safety of you, your employees and your clients. Some of the PPE you may require include gloves, aprons and masks.

Protect the personal data of your employees and clients

You must comply with the Data Protection Act and apply for a Notification to Process Personal Data Licence. All information should be stored securely, with the full consent of the individual, and should never be shared with a third party.

Register as self-employed

Running your beauty business as an individual or as a self-employed person requires you to register as a sole trader with HMRC. You will need to register the name of your business and keep records of all your income, profits and expenses.

Comply with employment legislation

If you hire any staff, you must comply with all areas of employment legislation, including recruitment, pay, working hours, holidays, sickness, maternity, paternity, discrimination and dismissals. This legislation may not apply if you hire staff as independent freelancers.

Cutting Hair

Positives of Owning a Hairdressing Business

There are many positives to owning a hairdressing business, including:

You can offer a personalised customer experience

You can offer customer consultations where you discuss what your customer wants and offer advice and insight. Your customer will receive a personalised experience and is more likely to be more satisfied with your service and recommend you to their family and friends.

You can choose to target a niche market

You can set up a general hairdressing business or target a niche market, such as hair extensions or wedding hair. This allows you to focus on the specific customers you want to attract or design your business in a way that increases its likelihood of success.

Create your own schedule

You can choose which days your business operates and the hours you want to work. If you run a hairdressing salon, you can choose the opening hours, based on your busiest days and your own preferences. As your business grows, you can also work fewer hours and allow your employees to handle the hairdressing duties.

Choose your staff

If you hire other hairdressers, hairstylists, admin staff or cleaners, you will be in charge of the hiring process. This means you can choose the staff who best fit your business. For example, those who are the most qualified, the most personable or those that will fit in best with your business.

Design your dream business

Regardless of whether you open a hairdressing salon, a home-based or mobile business or operate as a freelancer, you can design your perfect business. This includes the types of services and treatments you offer, your business aesthetic and your branding.

Consistently high demand

People always need their hair cut and styled, meaning your hairdressing business will always be in high demand. Even if you have a lot of competition in your local area, you will likely still have demand for your services. No matter the type of hairdressing business you set up, you should always have a good customer base.

Connect with the local community

Having a good gossip at the hairdressers is an accurate stereotype. Operating a hairdressing business in your local community can help you to become an important part of the community. People love to talk when getting their hair done, meaning you will learn a lot about your clients and their lives and create real relationships. People also only go to hairdressers that they trust.

Customer loyalty

Once people find a hairdresser that they like and trust, they usually choose that business every time. This gives you high customer retention, with the same clients coming to you for years. They may also recommend you to friends and family, especially if they are complimented on their hairstyle. This can offer you increased business.

Rewarding work

If you are passionate about hairdressing, doing something you love and making connections every day can be extremely rewarding. People often get a new haircut or style when they want to change their mindset or mark a new chapter in their life. Being part of this and seeing your work make customers happy can be extremely rewarding.

Be your own boss

Being your own boss allows you to create your schedule, hire the employees you choose, create a better working environment and choose the direction your business goes in.

Face-to-face interaction with your clients

Hairdressing is a people-orientated profession where you will spend your days working directly with your clients. This could be a huge benefit to those who enjoy spending time with others.

Predictable income stream

Most of your appointments will be booked in advance and your schedule will be created ahead of time. This makes it easier to predict your income and plan your profits.

Unlimited income potential

Once your hairdressing business is established, you can opt to expand your business or open additional salons in other areas. This allows you to grow your business and your income.

Easily gain exposure

The rise of social media makes it easier than ever to gain exposure. You can post photos and videos of your clients and your work and become noticed online. Your clients can also post their own photos and tag your business in them. This allows you to grow your client base and increase your profits.

Hairdressing Business

Negatives of Owning a Hairdressing Business

Similarly to other businesses, a hairdressing business has some cons that you should be aware of.

Physical strain

Hairdressers stand up for hours at a time, with frequent bending down. They also use repetitive movements when cutting, brushing and styling hair, which can cause strain injuries in the wrists, fingers and hands.

Building your clientele can be difficult

Successful hairdressers may spend years building up their client base. This could mean you initially receive less custom and earn a lower income. If you have invested a lot of money into your business, this could result in your business failing.

No benefits

As you are self-employed, you won’t receive benefits such as pension contributions. You will also be responsible for doing your own taxes and organising your National Insurance contributions.

High start-up costs

The equipment needed for a hairdressing business can be expensive. If you open a salon, you will also be responsible for the rent and renovation costs. Even a mobile business has to purchase a vehicle and mobile equipment. The high start-up costs means you may need to source outside investment.

High time commitment

Many hairdressing businesses operate seven days a week and are most popular in the evenings and at weekends. Not only will you need to be available for hairdressing, but as the business owner you will also need to consider the time you will need to spend on administrative duties, such as doing taxes, marketing and advertising, making appointments and ordering stock. Running a hairdressing business can be demanding.

High liability

A hairdressing business has many potential risks that could result in liability issues. This could include employee accidents, the risks associated with using chemicals and certain types of equipment and the risks associated with hair cutting and styling.

It can be stressful

Being responsible for the success of your beauty business can be stressful, especially when you initially set up your business. Gaining clients, growing your business, ensuring health and safety and making a profit can be stress-inducing.

Motivation of employees

Your hairdressing business may require you to hire employees. Although employees can be advantageous to your business, they can also be harmful. If you employ staff who are unmotivated, disinterested or have a negative attitude, this can create a negative experience for your customers which can result in bad reviews or the loss of custom.

Work can be inconsistent

You may find that certain times of the year, such as the lead up to Christmas, are much busier than others. Particularly if you run a specialist hairdressing business, such as wedding hair or hair extensions, you may have times of the year where you are significantly less busy. Inconsistent work can result in inconsistent profits.

Planning Your Hairdressing Business

When starting up a hairdressing business, it is important that you create a well-designed and effective business plan.

Planning your business can help to maximise your profits and ensure the success of your hairdressing business.

When planning your business, consider the following factors:

What type of hairdressing business will you set up?

Deciding whether you will set up a salon business or operate a mobile or at-home business is one of the crucial decisions you need to make. As a salon requires more equipment and has higher start-up costs and running costs, you may choose to open a salon later once your business is more established and you have the necessary capital.

What treatments and services will you offer?

Are you going to offer general services, such as hair cutting and styling or will you offer specialised services? You may hire employees who have different skills or training to you as this will expand the services your business offers. Different services will have different price points and different typical customers.

What are your employee requirements?

Are you going to operate your business alone or will you hire employees? Employees will result in additional outgoings; however, they will allow you to offer more services at one time and could result in more business and higher profits.

What equipment and products do you need?

Consult the list above to determine the equipment and products you require, and the approximated costs associated with these. What equipment is essential and what can be purchased at a later date? Can any equipment be rented rather than bought?

Where will your business be located?

The location of your business will impact your rental costs, running costs, typical customers and your price points. Aim for an area that has high footfall or is easily accessible.

What are your financial requirements?

Use the list above to calculate your start-up costs and running costs. What initial investment do you require and when will you start turning a profit?

Who will your typical customers be?

Once you have determined your location and the treatments and services you will offer, you can then identify your target customer base. Knowing your typical customers can make planning your business much easier. It can help you to design the aesthetic of your premises and determine your advertising strategy.

What is your local competition?

Scrutinise your local competition to help you determine how to make your hairdressing business successful. Look at the services and treatments they offer, their price points and their business aesthetic. You can then decide how to make your business stand out and how to attract customers.

What will your pricing structure be?

You will have different prices for each service and treatment you offer. Your pricing will depend on your start-up costs and running costs, your location and your local competition.

What are your business objectives?

Determining your business objectives is an essential component when creating your business plan. Your business objectives highlight the targets and goals of your hairdressing business and help you to create a one-year, three-year, and five-year business plan.

Your business objectives should be SMART:

      • S = Specific
      • M = Measurable
      • A = Achievable
      • R = Realistic
      • T = Time-bound

       

      Have you complied with all legal requirements?

      Consult the list above and ensure you have complied with all legal requirements before opening your hairdressing business. Failure to comply with the legal requirements could negatively affect your business and your profits.

      Download our business plan

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