The Guide To Owning A Beauty & Wellness Business
Most people go into owning a salon, spa, or shop because they’re not happy where they’re working, and they think they can do better as a business leader. With little to no training on owning or managing a team, many professionals go into this blindly. As you contemplate ownership, the biggest question you have to ask yourself is, “Why?” Why do you want to own? Do you want to work alone, with a team, with a partner? Do you want to be a boss to others? It is very important to take the time to reflect on why you want for this yourself. These answers will be helpful long after the euphoria fades and the real work begins. If you can confidently answer these questions, here’s how to get your business off the ground.
Steps to Ownership
Conduct Informational Interviews
Find someone who owns the type of business you want to own. Is it a large salon, spa, shop? Or is it small, maybe 3 chairs? Call them up and ask if you can take them to coffee. Ask the hard questions and ask them to be very honest with you. Some questions to ask: If you could do it all over again, what would you do differently? What is the best thing about ownership, the worst thing about ownership? How long did it take for your business to be profitable? These conversations will help you learn what it really takes to own and operate the type of business you want.
Take Business Classes
Even the best service providers can be the worst business owner; your technical skill means nothing if you don’t have business skills. You must understand the ins and outs of running a business and online classes can help you get that baseline knowledge. Utilize MiladyPro online business skill classes and the resources provided by the Small Business Administration to focus on these skills.
Assemble Your Team
The saying “it takes a village” definitely applies to starting your own small business. Here are a few people you’ll need to add to your dream team.
- Lawyer and an Accountant – There are financial and legal implications to owning your own business. To ensure you are operating within the law you will need a lawyer and accountant to help you navigate the sometimes-overwhelming world of laws and numbers.
- Financial Adviser – Yes, they are different from an accountant! Understanding the health of your personal finances and equity will help you make the best decisions for your business.
- Bank or Banker – Like your lawyer, accountant, and financial adviser, you need to have a great relationship with a bank or banker, so they know your plans and goals.
- Advisor – This is someone you trust, who you can talk to openly. An advisor is a trusted professional who can also, but not necessarily, be your mentor.
- Insurance Agent – You need to know the rules and regulations of insurance compliance yourself but having a personal agent will make understanding the ins and outs easier.
- Payroll / HR Company – Depending on the size of your business, you may hire an independent bookkeeper or outsource to a company who specializes in payroll, onboarding, employee policies, etc. You will need to have an employee handbook with the policies of the salon, spa, or shop. You can create this yourself or outsource it. Don’t open your business without one. It outlines what is acceptable and unacceptable behavior and provides protection for both you and your employees.
Know the Laws
Understand the laws that govern your city and state in both business and the state board world. The Small Business Administration can help you with this information as well as your state board.
Create Brand Standards
Remember a logo does not make you a brand. Understand who you are and what you stand for; the design can come later.
Once you have a clear understanding of your “why”, why you want to own your own business and have completed your research on what it will take to realize your dream, the real work begins. Before you head to the bank for a loan, make sure you have these five things in place.
- Write a business plan Opening a business is exciting. Unfortunately, that excitement can quickly disappear when things don’t go the way you had imagined. Writing a business plan forces you to consider all aspects of your business from the build out to client building. It is the most important piece of your success and sanity! Business plans are fluid, which mean they can change, but they are key to keeping you focused and on point during the build out.
- Prepare a cash flow projection plan This cannot be stressed enough. If you do not know how much money you need to produce to cover expenses and to pay yourself, you’ll be taking on more stress than needed. Take the time to develop a cash flow plan for at least your first year. (3 years is ideal)
- Set aside three months of working capital Once you’ve estimated your monthly expenses, set aside at least three months of working capital. Why? Things happen. Sales start slower than anticipated, the “perfect” team member leaves after their first month, construction costs run higher than anticipated, your car breaks down, and the list goes on. This is your safety net.
- Develop a recruiting, hiring, and retention plan Yes, hiring is important but thinking first about recruiting forces you to consider the type of team members you want. When your doors open you don’t want to find yourself in a state of desperation forcing you to hire a warm body. Take the time prior to opening your doors and plan how you go about recruiting. Think about what your hiring procedures will be and finally how you intend to keep those team members once you hire them.
- Seek professional mentoring You don’t have to do this alone. Seek help, advice, and even coaching from those who walked in your shoes. Join professional organizations, ask questions on discussion boards, attend workshops, and peruse online companies to find ongoing education. Your best investment in coaching may be before you open your doors.
The satisfaction, joy, and sense of accomplishment that comes from owning a business, for many, is worth all the ups and downs. Take your time, plan your work, and you will succeed.