Five Pitfalls to Avoid When Starting A Beauty Business

Don’t Let Overspending Or Uncle Sam Sink You Before You’ve Started Swimming

Being your own beauty boss is a big step. It takes a lot of planning and courage to leave the creature comforts of a salon or spa and go out on your own. But for all the things you need to make the beauty business of your dreams a reality, there are a few mistakes many first-time entrepreneurs make that can easily be avoided. Here are our top five pitfalls to look out for when getting started with your own business:

Not Having a Business Plan. 

Sure, you may be doing the same thing you’ve always done, but being your own boss is a lot different than working in a salon. Before you go out on your own, put your plan to paper with details about your start-up costs and revenue projections. The last thing you want to do is commit to a major career and lifestyle change without really being sure that it’s going to work for you. 

Overspending Early.

We see it all the time. Stylists get super excited about fitting out their own space and creating their dream product offering without really thinking it through. You don’t need to buy everything from the get-go, in fact, it’s actually better to build over time. Invest in a few key furnishings that will make your clients comfortable and start with basic, best-seller products that you know people will love. You can always elaborate on your environment and your retail offering once your revenue is steady. 

Mixing Personal and Business Finances.

We always tell new salon suite owners to set up a separate business bank account from day one. It’s absolutely crucial to keep personal finances in a different account for two reasons. First, it makes it incredibly easy to analyze your incomings and outgoings every month to ensure that your revenue and expenses are where they need to be. Second, it makes tax time a breeze for both you and your accountant. 

Operating Without Limited Liability Insurance

At Briary Salon Suites, we even don’t allow stylists to rent space from us without limited liability insurance because it’s so much smarter to be safe than sorry. Limited liability insurance covers a stylist within their four walls and also protects their equipment and supplies. A slip and fall or even a color processing accident can happen. It’s not worth risking your license or your career just to save a few bucks. 

Not Setting Aside Tax Money

This might not seem very important, but we’ve seen too many stylists get themselves into financial trouble because they didn’t anticipate Uncle Sam’s cut. It’s a smart idea to not only know what you need to set aside for taxes, but you might even consider prepaying them. Regardless of how you do it, we recommend setting up quarterly payments to keep up to date with tax commitments without having to drop a huge lump sum. If COVID taught us one thing about money, it’s that keeping good books can really benefit you if you need a little financial help down the road.

Talia Horta is the co-founder of BriAry Salon Suites, a collection of boutique luxury spaces designed specifically for beauty business owners. BriAry Salon Suites offers rentals as well as business mentoring and coaching to help stylists, aestheticians, and technicians navigate the world of entrepreneurship. www.briarysalonsuites.com