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How To Finance A Nail Salon


Can’t shake the vision of opening your very own nail salon? How do you find the money to start a salon and keep the doors open? When you head down this road it’s crucial that you pare it down to the essentials only. Here are some practical trips to strategize and execute your new business venture.

We wish there was a fail proof instructional manual with a no-brainer guide for success. Far too often success stories are packaged as overnight fairy tales. What a complete misconception! If only a strong business plan with angel investors guaranteed an immediate return on investment. If you want to raise capital to open a salon or finance your education to become a nail tech, how do you pay for it while you build your technique and a clientele? Do you look for a bank loan or finance it with credit cards? Here at Young Nails, we’ve seen the many paths you can take to build a thriving nail business but the best place to start is small and with discipline. The dream is actually built slowly through action and intention; day in and day out.

Of course, we also have two unique views on the subject from our own experience. You can take on debt to start a business but do it with control and a plan. The plan is to start out small right? Make smart choices with the money. No need to run around compulsively shopping for the salon. Create a budget with line items for every expense. Total these items up and this is your spending plan. You have to know where every dollar is going. Make a projection of how long you can cover your overhead expenses like product and rent before your funds run dry. Is it two months, three month, or six months? Have you calculated the equation of how many clients you need to see to break even? What does that equation look like to actually start earning serious money? Write those target numbers down. Put them in a calendar as a reminder so you can double check if your monthly projections and your reality are matching up. You can’t go into it blind. You need to be very clear about your finances and make every dollar borrowed/earned work for you.

Knowing these numbers provides you the chance to switch gears if you need to. Run your business decisions by a trusted mentor or business ally who’s already successfully doing what you want to do. You don’t have to do this kind of work scared and alone. Reach out to the community. Ask for help, an experienced nail tech can show you the ropes. They have the ability to edit your shopping list for salon essentials; calling out the distinction between a need and a want. It’s a common pitfall to spring for the pricey big ticket items, super luxury spa build outs, or get upsold on specialty products you haven't quite mastered. It’s the equivalent of handing a sports car over to a teen who just earned their license. It can be done, but probably won’t end well. If there is something that you are completely obsessed with; keep a little “obsession” envelope and stash some cash from every service to treat yourself to it.

With business, there are really good days, really bad days, and middle of the road days. Some days you get ahead of it and the very next you might fall back. Inching your way out of debt is a give and take. Profitability is not a skyward rocket trajectory but more of a slow dance. Obviously, there is no way to predict the future. However if you make a money plan (both how to earn it and how to spend it) you will have clarity. Think about every step of the way. This sets you up for a greater likelihood of actually earning an incredible living as a nail tech. In our experience, we created a vision and partnered it with a clear strategy for sixth months out in the business. Then we’re always prepared to rethink the plan, adjust, test, and rethink again. The only thing we can compare it to is the rock climbing documentary Free Solo that is a story of passion, obsession, feel and calculated risks. A must see.

After three years of successfully booth renting, you might get an itch to go bigger. You may want to open a salon. Maybe that downtown industrial space (in need of a remodel) is calling out to you. It’s easy to fall in love with creating a beautiful spa with a contractor, designer, additional staff and the fast pass to spending $200K. What to do? Look for something you can afford without investing too much out of pocket. You don’t want to go into that kind of debt. You want something that you can pay even if you have zero clients. If for some reason you cannot resist the fixer-upper, plan for the remodel to cost double the amount originally budgeted. It always goes over in time and budget more than you anticipated. In the meantime, your money is flying out the door while nothing is coming in. Don’t let the dream be over before it’s started because you’re in over your head with debt. If you plan to put it all on a credit card or borrow from friends and family, draft a reasonable plan to repay it. How many months will you carry that balance and when will you pay it all off.

Dial in your hiring, marketing, and services. Then buckle up for the ride of your life because it’s a lucky few who make a financial killing right off the bat. You want to do more than break even. You want to stay disciplined, self-directed and stick to your plan. Start small and manageable. Everything takes time. You have to expect and save for the unexpected; that’s the reality of running your own business. You need to understand all the boring money stuff so you can enjoy the really fun money stuff. Don’t fall in love with the dream and not be able to show up for the work. The dream can wait for when the timing is right for you financially. This is our recommendation for someone starting out.

**This is an adaptation from our YN Biz Talk playlist on YouTube, “BIZ TALK: HOW TO FINANCE A NAIL SALON”

***Follow our YN YouTube Channel and click here to watch the full discussion: