Stylist cutting a woman’s hair in a beauty salon.

Opening a hair salon or barber shop: Questions to ask

As you get ready to open a hair salon or barber shop, we're here with some helpful tips.

Being in the beauty-barber business is more than helping people feel confident in their appearance, it's your path to pursuing your dreams.

When it's time to look at how to start a hair salon or barber shop, questions you need to consider include what services you want to offer, where you will locate your business and do you have the right coverage options for your salon or shop to help protect your hard work.

What services do you want to offer?

As you evaluate the services you want to offer you'll need to consider whether you'll need any special licensing, if you'll need additional professional training or if you'll need to hire someone with certain skills and licensing.

Also, research the regulations in your state. States may require a cosmetology license for some services while requiring a barber license for others.

Part of creating a plan for your business is making sure you stay organized when scheduling clients. Think about how long it takes for you to do each service. Cutting someone's hair could take 30 minutes while doing a sew-in or putting in extensions may take two or three hours.

You might want to consider scheduling clients based on whether the service they are requesting is a side-source of income or the main source of income for the business. And of course, make sure your schedule allows for time in between clients so you can get a break or accommodate those who are running late.

You also need to decide the cost of the services. As you look at how much time you need to do the work, you should consider what your competition charges for the same services. You may need to adjust your charges according to how expensive the supplies are for the service.

Where do you want to set up your business?

The next big decision to start a hair salon or barber shop will be deciding the location and space requirements, and business model. There are several different options with benefits and challenges to each.

Renting a chair or booth

  • Pros: You have the freedom from maintenance on the building and no major bills besides renting the space. You will only have to worry about yourself and the services you provide.
  • Cons: You may have to give up a percentage of sales to the owner of the salon or shop and share a chair or booth with others. And you may not get to schedule your own hours.

Owning your own salon

  • Pros: You can set the hours, hire the people you want and have the option to rent out chair or booth space to earn extra money — you are your own boss.
  • Cons: You will likely have more responsibilities including issuing W-2s for your employees and 1099s for independent workers. You may have to cover employees and independent workers on your insurance since you own the salon. Also, you may be responsible for major expenses and making sure you have appropriate staffing.

Mobile hair stylist or barber

  • Pros: You can be in a different place every day and meet various people with different lifestyles.
  • Cons: It might be difficult to build up your clientele and you may have the hassle of packing up your tools every day. You'll need to pick popular places to provide your services so that you have a better chance of making a profit.

Do you have the right insurance?

And finally, you'll need to make sure you have the right insurance for the services your shop or salon offers.

Options can include a Business Owner policy and a Homeowners policy. If you are operating your small business out of your home, you'll want to check if there is optional coverage for a trip and fall due to business operations. If not, you may need to consider a business policy.

If you are renting a booth or traveling to different locations, there may be additional coverage options for your business exposure. Third parties such as landlords may require you to have higher limits. Business policies typically allow for those higher limits.

Also, when looking at a business policy be sure it will help cover your supplies such as product, towels, capes, styling tools, hair wash sink bowls, the rental space you are in charge of and loss of income in the event of a fire or tornado.

You should also check with your insurance provider to ensure you're covered for professional liability in the event you accidentally nick someone's ear or a client gets a chemical burn. Basic business policies may not automatically cover professional liability.

Not sure if you're fully protected? Meet with a State Farm® agent to discuss the insurance needs of your business.

The information in this article was obtained from various sources not associated with State Farm® (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates). While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. State Farm is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. State Farm makes no guarantees of results from use of this information.

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