Anyone thinking about opening a salon will need to decide whether to join a hair salon franchise or go it alone as an independent salon.
Franchises are a huge part of the industry and can be a great way to start your salon business.
If you want to find out if joining a hair salon franchise is right for you, the first step is to take a look at the risks and benefits that franchisees face at salon chains.
Let’s start with the basics. So what is a franchise opportunity?
Essentially, a franchise salon is a business model that happens when someone (the franchisor) establishes a trademark for their salon business and system of doing business and then charges other people a franchise fee for the privilege to use this business name and system.
Franchising companies often offer other support to their hair salon owners, as well. Some of the largest hair salon chains offer staff and management training and specialized resources to help each of their franchise stores become successful.
Brand Recognition: New hair salon businesses often have to build their brand awareness and customer base from the ground up, but franchising is one way to take a shortcut by relying on the support of an existing and trusted name to help bost your marketing.
Existing Customer Base: Hair salons that are part of a franchise chain can rely on clients in almost any location being familiar with the name, which can cut way down on the initial cost of advertising to get customers in the door for that first service appointment, helping your location to see higher profits and better growth than independent salons when they first open up.
Business Support: A franchisee can usually depend on professional development opportunities for management and staff, as well as a business network willing to offer advice and free assistance to help them get set up and run their salon, sometimes even including equipment, training materials, a business plan and supplies as part of what your fees cover.
Buying in Bulk: One advantage that businesses in a franchise enjoy is that they’re not replenishing their back bar or retail products alone, and they often pay lower prices for products because the whole network of franchises in their area or several locations will buy in bulk, cutting down on the total number of fees that vendors will charge individual businesses when they order items.
Less Experience Required: If you’ve always dreamed of owning your own company or starting a salon business but aren’t sure how to go about it, franchising can be a great way to get into the beauty industry- a franchisee can become part of a chain of successful salons and receive a lot of assistance with the basics such as advertising, hiring and managing their salon.
Less Risky: National haircut chains have already tested their business model in multiple locations and refined their methods for succeeding in the industry, which can make them a safer bet as an investment.
Favorable Failure Rates: Hair salon franchises carry less risk of failure than independent hair care businesses, with one study citing at least an 8% higher success rate; working with a well-known full service salon chain or hair cut salon franchise is a great marketing tool and can help you get the most out of your initial investment.
Freedom (With Benefits): Franchising lets you be your own boss without being totally on your own; salons and their owners are part of a larger support network with access to a number of different resources that independent locations don’t get.
Can Be Very Profitable: One of the benefits of the instant brand recognition that comes with joining a franchise is that you already occupy a space in the salon service industry and customers are familiar with your services and products- franchisees can benefit from this popularity and the customers it brings in.
Check out our post on How to Increase Your Salon's Profitability.
Of course, even the best haircut franchise opportunities have some disadvantages, when compared to owning your own salon. Let’s go over some of the most common drawbacks that a potential franchisee needs to be aware of, before they make that initial investment.
Initial Fees: Popular chain salons and even smaller franchises usually require an initial investment (or franchise fee) in order to join the company, the cost of which can vary among different franchising opportunities and locations.
Rules and Regulations: Even the best hair salon chains still require you to adhere to their rules and professional standards, including things like hours of operation, advertising requirements or even which holidays you work (depending on your franchising agreement).
Creative Restrictions: Salons that join franchises don’t always have artistic control over their layout, website, decor or even the music they’re allowed to play, which can be challenging to deal with.
Ongoing Expenses: Depending on your franchise agreement, you may have to pay ongoing costs such as a royalty, company training fees or other business expenses on an ongoing basis.
To learn more, do check out our post on Hair Salon Expenses.
Conflicts Can Occur: Chain hair salons rarely operate in a vacuum, and if you have to deal with a manager or colleague that you don’t get along with, you may not have any choice but to deal with them.
Not Your Brand: Franchises are great, but they don’t give you the opportunity to build up your own business under your own brand, which can make it hard to break away and do this later.
So, what is the average hair cut salon franchise price?
Hair salon franchises vary a lot in terms of the services they offer, the image they present in the industry, and in terms of their franchise fees.
It’s also important to note that the number of fees that you pay may likewise be linked to the benefits and services the franchise company provides, in return for your investment.
Let’s take a look at some of the average franchise fees and what they cover:
Franchise Fee: This is the initial investment that franchisees make in order to join. Most hair salon franchises charge between $20,000 to $50,000 for this.
In return, you are able to use the company’s brand name, their business systems, training materials, staff uniforms and anything else that they offer (such as a website, for example) to set up and market your salons.
You’re also likely to get a discounted rate on hair care supplies and retail inventory, if your company buys in bulk or has a contract with a supplier.
Sometimes, you can get a discount on this initial fee if you open multiple units or locations at once.
Opening Inventory: The products that you’ll need to open your salon’s new location. Often, you’re required to buy hair franchise products and stock, sell and use particular product lines, depending on your company. The costs of these will vary a lot, but it’s normal to spend $5,000 to $10,000.
Royalty Fee: A royalty is the annual fee that you will pay the hair salon franchise company in order to continue to use their services and company name. Royalty rates can either be a set amount or a percentage of your total revenue.
Training and Setup: This includes everything from upgrading your signage and furniture, to decor, staff and management training and even website templates and IT services in some cases. Including rent, this can cost anywhere from $100,000 to $300,000.
So, how much does a salon franchise cost? It can depend a lot on the franchising company, whether your location is rented or owned, and the value of the services they offer.
Of course, you can save time and money by managing your franchise well and keeping an eye on your own expenses. Investing in salon software for franchises will help you to stay organized, track and book appointments and get the most out of your staff’s time.
There are so many different options (both mainstream and niche) available for franchisees to choose from. You may want to focus on kids’ cuts, barber services or just open a regular haircut business.
Here’s a list of some of the best franchising we’ve found.
This barbershop chain was founded as part of the Regis corporation and was founded in 1999. Roosters Men’s Grooming has 85 different locations across North America and they don’t require franchisees to have prior experience, since they provide training.
he total initial investment starts at $189,500. The franchise’s fee is $39,500, and they require you to have at least $150,000 in liquid assets when you sign up.
Another Regis corporation franchise, Cost Cutters has over 740 U.S. locations and they focus on affordable and fast haircuts.
Founded in 1982, Cost Cutters requires franchisees to have a minimum of $250,000 in liquid assets, and a net worth of $1 million to join. Your initial investment can be as much as $180,000.
This barbershop has a sports-themed interior complete with tv’s playing sporting events. Sport Clips markets themselves as offering an “MVP Experience” with each haircut or shave.
Sport Clips requires you to purchase a minimum of three Sport Clips licenses, with a fee of $59,500 for the first three stores and $12,500 for each one after that. Keep in mind that you’ll also have to build or remodel the units to suit their specifications.
With a focus on community involvement and raising money to help different causes, Great Clips has over 4,400 locations across North America. They’re a family friendly salon that doesn’t require appointments to get a kids’ or adult’s haircut.
Joining Great Clips costs $20,000 initially, with the total fees amounting to about $136,900 to $259,400.
An industry leader, Supercuts has over 2,000 nationwide hair salons.
The cost of joining Supercuts is between $10,000 and $30,000. They require franchisees to have at least $150,000 in liquidity and a net worth of $500,000.
A recent addition to the scene, MY SALON Suite was founded in 2010 and specialize in providing a luxury experience with a variety of different beauty services, not limited to haircuts alone. Their suite rentals are open to different beauty professionals across the industry.
To join them, you should have a $1 million net worth, $200,000 in available funds and a good credit score.
A sophisticated barbershop, Scissors & Scotch serves clients a free drink with their haircuts and offer a full-service bar. Franchisees have access to business-related services and advice on everything from choosing a location to setting up your marketing and website.
To join, you’ll need at least $45,000 for a single unit and $433,050 to $628,500 total.
Another mens hair salon franchise, ManCave offers other grooming services, too such as massage and skincare. Their decor focuses on comfort with flatscreen tv’s, cushy chairs and free drinks.
Expect to pay $40,000 to join, and somewhere between $139,500 to 190,500 in initial costs.
Who said these franchises were just for men and women? This one centres around kids and all things kid-friendly, with specially-trained staff on the job and kid friendly (as well as vegan and cruelty-free) products.
Family owned, Cookie Cutters focuses on kids and family friendly experiences, with playgrounds inside their units and free suckers given out after each cut. Their website boasts average revenue of 25.6% net profit on their units.
They currently have 114 U.S. salons and require that you fill out an application to join them.
Founded in 2010, they offer a modern, but affordable experience with lots of support for franchisees. Image Studios 360 offer specialized business plans and assistance with getting set up.
To join, you’ll need $500,000 in ready capital and at least $49,750 for the franchise fees.
Floyd’s 99 Barbershop offer services for both men and women with an “old school” aesthetic and decor. Similar to Great Clips, Floyd’s has partnered with the Juvenile Diabetes Research Foundation to raise money. They ask that you invest in at least four units.
Founded in 2007, Phenix Salon Suites now have more than 230 U.S. locations. Another suite rental option, they’ve been featured in Entrepreneur’s Top 500 Franchise list four times. They also market their own lines of skin and hair care products.
It can cost between $300,925 and $1,380,050 to join this franchise.
Having been featured in Entrepreneur’s Franchise 500, as well as several other publications, they’re definitely a big name in the industry. Using a strategy similar to Supercuts, Fantastic Sam’s focus on offering a full range of affordable services.
The total cost of joining is $144,862 to $316,606, and you’ll need a net worth of $500,000.
They were founded in 1999 and offer professional training when you join. Upscale and modern, V’s Barbershop charge $30,000 to join but offer discounts if multiple units are owned.
Initially owned and operated in Canada, they’ve since spread to over 130 North American locations. They’re clientele is mostly women, but Blo Blow Dry Bar don’t cut hair: their slogan is “Wash. Blo. Go.” and they focus on blowouts. It costs arounds $242,823 to $367,102 total to join them.
Franchising is a great way to get into the hair industry, since a lot of materials and training are provided for you.
That said, there are a lot of responsibilities and some drawbacks that come along with it, and it’s not for everyone.
Before deciding whether or not to join a hair salon franchise, take a look at the opportunities that are available and draw up a budget and “wishlist” of the ones that you might like to join. Check each one’s website for the “fine print” and more details.
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