Sample Hair and Beauty Salon Business Plan

Business name: XYZ Hair and Beauty Salon

Executive Summary

XYZ Hair and Beauty Salon is a hair & beauty salon dedicated to providing customer satisfaction by rendering excellent service and quality products in a relaxing atmosphere at a reasonable price.

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Mission: To supply services and products that enhance XYZ' physical appearance and mental relaxation.

The timing is right for starting this new venture. An ideal location has been found on K-street. Customer demand will come from both the people residing and working adjacent to XYZ salon's location. The owner has also used her/his comtacts who are also keen to become customers.

Sarah Yipe the owner of XYZ has extensive experience in the hair and beauty business. (see owner profile below in the management profile section).

To achieve its mission, XYZ is seeking startup/ expansion debt (loan)/ equity/ grant financing. Debt will be paid from the cash flow from the business. Collaterol will be assets acquired for the salon as well as guarantee from owner/ others.

XYZ's competetive advantage lies in its:

Location: which is easily accessible and has high foot traffic.
Ambience: the salon provides an environment conducive to giving relaxing and professional service.
Convenience: XYZ will be a one-stop shop for hair and beauty. Opening hours will also cater for working women.
Reputation: the owner already has a reputation of providing superior service.

Company Profile

XYZ Hair and Beauty Salon will, upon commencement of operations provide quality hair, nail, and skin services, using top quality beauty products. What will set XYZ apart from its competition is the owner's commitment to providing all of these services in a convenient location at a reasonable cost.

The salon will be located on K-street. The location is strategically situated on one of the busiest streets in Kisumu. It is easy accessible and is buffered by offices and residential areas.

Start-up Summary

The start-up capital for the salon will be used for the interior design, purchase of equipment and furnishings, and rental/purchase of the location.

Interior improvements will amount to approximately _____, and salon equipment will cost about ____.

Start-up Expenses (Kshs.)
Rent deposit _______________________________________________________
Assets (equipment, furniture and fixtures) __________________________________
Cash requirements __________________________________________________

Planned Investment

Owner Kshs __________________
Investor Kshs. ________________

Total Planned Investment Kshs. ________________

Liabilities and Capital

Liabilities:

Current Borrowing Kshs. ____________________
Long-term Liabilities Kshs. ________________________
Accounts Payable (Outstanding Bills) Kshs. __________
Other Current Liabilities (interest-free) Kshs. _________
Total Liabilities Kshs. ________________

Capital

Planned Investment: Owner Kshs. ____ Investor Kshs. ___
Additional Investment Requirement Kshs. __________
Total Planned Investment Kshs. ______________

Loss at Start-up (Start-up Expenses) (Kshs. ___)
Total Capital Kshs. __________________

Total Capital and Liabilities Kshs. ________________

Total Funding Kshs. __________________

Products and Services

XYZ Hair and Beauty Salon will offer a wide range of services that include:

Hair: cuts, relaxers, colouring, shampoo, conditioning, curling, weaving and braiding.
Nails: manicures and pedicures.
Beauty Care: facials and massage.

Strategy and Implementation Summary

XYZ will excel at good customer service, and creating a pleasant environment for customers.

Competitive Advantage

XYZ will set itself apart from other salons that may offer only one or two types of services. The salon will be a one-stop-shop for customers who frequently become frustrated that they cant do their hair and beuaty in one location.

XYZ will also compete on price as the other salons have higher overheads. XYZ has negotiated with the owner of the property to a lower rental.

To make customers more comfortable, refreshments will be served.

Marketing Strategy

The marketing strategy will be mainly word-of-mouth referrals. Small advertisements will be put into the women's section of the classifieds. Offers and discounts will also be used to attract new clientelle. A loyalty bonus point programme will also be implemented so as to reward existing customers and ensure they remain with XYZ.

All these marketing strategies are low cost and thus will ensure that the business budget can be more focussed on providing quality service.

Sales Forecast

The following table and charts show projected sales. Income is expected to rise steadily over the next three years, as the reputation of the salon and quality of service becomes apparent to the general public.

Download and edit sample sales forecast worksheet »»

Milestones

Download and edit Milestone Table template »»

Financial Plan

Important Assumptions

The financials below have a number of assumptions:

1. Salaries and benefits will increase at __ % per year.
2. Operating expenditures will increase at ___% per year.
3. Debt Service uses our current schedule for debt service payments
4. The annual funding requirements are from the 5-year plan as prepared during the budget process. Those items which will not be funded on a pay-as-you-go basis have had the annual debt service requirements estimated based on current market conditions. There are no new projects expected.
5. VAT is not expected to increase.