The tanning industry is a booming business in the United States, generating over $3 billion in revenue annually. With the increasing popularity and demand for tanning salons, starting your own business can offer you a lucrative opportunity. However, diving into any business venture without proper planning can be risky, so it's essential to develop a concrete plan and checklist to guarantee your success. If you're wondering how to get started in the tanning salon industry and establish a business that will be profitable in the long run, we've got you covered. In this article, we'll walk you through ten essential steps to help you open, start, or launch a tanning salon business. Whether you're a seasoned entrepreneur or a newbie, these tips will undoubtedly set you on the path to success. Step 1: Develop a Business Plan - Before you launch your tanning salon, you need to develop a solid business strategy. Identify your target market, devise your mission statement, and brainstorm your business objectives. This first step is critical to avoid any potential market traps and competition. Step 2: Develop a Financial Model - Starting a tanning salon comes with high financial investment and operational costs. Identify the cost of rent, equipment, staffing, marketing, and insurance. Determine if your business model is profitable before you begin. Step 3: Establish Relationships with Suppliers - You need to have a strong relationship with tanning suppliers. Contact various manufacturers in the industry, check prices, and compare quality in preparation for purchasing the latest equipment and technology for your tanning salon. Step 4: Determine Total Start-up Cost and Raising Funds - Research and be prepared for the total cost of setting up a tanning salon and raise the required funds accordingly. Consider asking for bank loans, sponsorships, or crowdfunding. Step 5: Hire and Train Professional Staff - Ensure that you are hiring staff who believe in your vision and mission. Help train them to deliver excellent customer servicet and professionalism. Conduct background checks, interviews, and provide employee contracts. Step 6: Prepare Location for Establishment - Identify the best possible location for your salon business. Ensure the business is visible, accessible, and convenient for your target audience of customers. Step 7: Obtain Necessary Permits and Licenses - Make sure that you are in compliance with state and local regulations when it comes to health, safety, and business registrations. Ensure you possess the necessary permits and licenses. Step 8: Market and Advertise the Tanning Salon - You need to establish your brand on social media, and local directories. Develop marketing materials and Social media platforms are a great way to engage with customers and inform them of any promotions. Step 9: Track and Record Service Data - Regularly track service data to monitor any trends or changes in customer behavior. Check the prevailing trends in the industry and adjust services accordingly. Step 10: Listen to Feedback and Adjust Services - Encourage customers to share feedback. Obsserve it, and adjust services to improve quality. This not only fortifies customer loyalty but also ensures that your tanning salon remains efficient and effective in providing quality customer service at all times. In conclusion, Now that you have the 10-step checklist to starting a successful tanning salon business, you're better equipped to start your venture. Remember, planning and preparation are essential; ensure to devote time and attention to each step of this process. With patience, dedication, and unwavering commitment to providing quality tanning services, you'll be on your way to a thriving tanning salon business.

1. Develop A Business Plan

Before opening a tanning salon, it's crucial to develop a thorough business plan. This plan will outline your goals, budget, target market, marketing strategies, and more. A business plan is essential to securing funding, making important decisions, and determining your path to success.

  • Executive Summary: This section should include a brief overview of your business, its goals, and how you plan to achieve them.
  • Market Analysis: Conduct research on your industry, target market, competitors, and trends. This information will help you understand market demand, pricing, and potential challenges.
  • Services and Products: Outline the specific services and products you will offer, such as UV tanning, spray tanning, skincare products, and more.
  • Marketing Plan: Determine how you will reach your target market and promote your business, such as social media, local advertising, and special promotions.
  • Financial Plan: This section should include a cash flow statement, balance sheet, profit and loss statement, and financial projections. It's important to set a budget, determine pricing, and plan for startup and ongoing expenses.

Tips & Tricks:

  • Take time to research and understand your competition.
  • Be realistic with your financial projections and budget.
  • Consider hiring a professional to help with your business plan.

Excel financial model

Tanning Salon Financial Model

  • 5-Year Excel Financial Projection
  • 40+ Charts & Metrics
  • DCF & Multiple Valuation
  • Free Email Support

2. Develop A Financial Model

Developing a financial model for your tanning salon business is crucial in order to plan your budget and estimate your revenue and expenses. A financial model provides insights that become the basis for decision-making, forecasting, and budgeting.

Here are the key chapters you should include in your financial model:

  • Revenue Projection: This chapter should define how the revenue will flow in and help you estimate the amount of money you will earn over the next three to five years. You will need to identify all your sources of income, including tanning services, products, and any additional services you may offer such as spray tanning or skin care.
  • Expenses: In this chapter, you need to identify all the expenses associated with running your business. This will include everything from rent, employee salaries, utility bills, supplies, to marketing expenses. It’s important to be as accurate as possible so you don’t run short of cash.
  • Cash Flow: This chapter should be based on your expense and revenue projections and will help you determine how much cash you need to keep the business afloat. By identifying your cash inflows and outflows, you’ll be able to create a cash flow statement that will project your daily, weekly, monthly, and yearly cash requirements.
  • Profit and Loss: Here you should assess the overall profitability of your tanning salon. You’ll need to compare your revenue to your expenses to create a profit and loss statement. This statement will help you determine whether your business is making a profit and how much you stand to earn over the course of a year.
  • Break-even Analysis: This chapter should be dedicated to determining the point at which you will break even or cover all your expenses for a given period. This will require a thorough understanding of your business’s fixed costs, variable costs, and revenue streams. This analysis will help you assess how much you need to sell to become profitable.
  • Capital Needs: In this chapter, you’ll need to assess your financing needs and capital requirements for your tanning salon business. You’ll also have to identify how much funding you’ll require and how you will acquire it.

Tips & Tricks for Developing a Financial Model:

  • Don’t underestimate the importance of a financial model. It can make or break your business.
  • Use realistic assumptions and be conservative in your estimates, especially when it comes to revenue projections.
  • Revisit your financial model regularly to identify key performance metrics and make any necessary adjustments.

3. Establish Relationships With Suppliers

As you start your tanning salon business, you will soon realize that building a solid relationship with suppliers is critical to your success. These relationships will help you keep costs low and ensure that your business runs smoothly. Here are some steps to establishing relationships with suppliers for your tanning salon:

  • Research Your Suppliers: Start by researching the companies that supply products to tanning salons. You want to work with a supplier that offers quality products at a fair price. Make a list of potential suppliers and compare their products, prices, and customer service.
  • Reach Out and Introduce Yourself: Once you have a list of potential suppliers, reach out and introduce yourself. Let them know who you are, what your tanning salon is all about, and what kind of products you are interested in purchasing. This initial contact will help you establish a connection with the supplier and get the conversation started.
  • Negotiate a Good Deal: As you start to work with your suppliers, try to negotiate a good deal. You can negotiate for better prices, longer payment terms, or bulk discounts. Be sure to read the contract carefully before signing anything and don't be afraid to walk away if the terms aren't favorable to you.
  • Communicate Regularly: You want to establish an open line of communication with your suppliers. Make sure to communicate regularly and keep them updated on your business. This will help you build a strong relationship and ensure that your suppliers are aware of your needs.
  • Build Trust: Building trust with your suppliers will take time, but it is essential to your success. Pay your bills on time, communicate honestly, and treat your suppliers with respect. Doing these things will help you establish a good reputation and build trust with your suppliers.
  • Explore New Products: Finally, be open to exploring new products and ideas from your suppliers. They may have products that you haven't thought of before, or they may be able to offer you new technologies that can help your business grow. Being open to new ideas and products can help you stay ahead of the competition.

Tips & Tricks:

  • Don't be afraid to negotiate with suppliers. They want your business, so they may be willing to make some concessions to get your business.
  • Stay loyal to your suppliers, and they will be more likely to go out of their way to help you when you need it.
  • Stay up to date with industry trends and developments, and make sure your suppliers are aware of any changes in your business.

4. Determine Total Start-Up Cost & Raising Funds

Opening a tanning salon business requires a considerable amount of investments in terms of capital and resources. As a pro business consultant, I have helped numerous entrepreneurs to determine the total start-up cost and raising funds for their businesses. Here are some of the essential steps to consider when estimating the initial expenses and collecting enough funds:

  • Create a comprehensive business plan that outlines the expected expenses, such as rent, utilities, equipment purchase, staff salary, marketing, insurance, taxes, legal fees, and other operational costs.
  • Estimate the total cost for each expense item and add them up to get a rough figure of the start-up cost.
  • Include a contingency fund, which should be at least 10% of the total start-up cost, to cover unforeseen expenses.
  • Decide on the business structure, such as sole proprietorship, partnership, limited liability company (LLC), or corporation. Each type has different requirements and costs associated with it, so choose the one that suits your business goals and budget.

Once you determine the total start-up cost, the next step is to raise the necessary funds to finance your tanning salon business. Here are some tips for raising funds:

  • Contact local banks, credit unions, and other financial institutions for loans or credit lines. However, be prepared to provide a solid business plan, financial projections, collateral, and other documents to support your loan application.
  • Look for angel investors or venture capitalists who are willing to invest in your business in exchange for equity or ownership. However, be aware that this option requires giving up some control over your business and sharing profits with investors.
  • Crowdfunding is another option to raise funds through online platforms such as Kickstarter, Indiegogo, or GoFundMe. However, success rates may vary, and you will need to promote your campaign through social media and other channels to attract potential donors.

Some tips & tricks:

  • Consider partnering with a business mentor, who has experience in the tanning salon industry, to guide you through the start-up process and provide valuable insights and contacts.
  • Create a comprehensive financial plan that includes revenue projections, expenses, cash flow, break-even analysis, and profitability targets to ensure that your business is financially sustainable.
  • Try to negotiate better deals with suppliers, landlords, and lenders to reduce your expenses and maximize profits. However, don't compromise on quality or customer service.

Determining the total start-up cost and raising funds for your tanning salon business may seem daunting at first. But with the right planning, strategy, and execution, you can secure enough funds to launch and grow your business successfully.

5. Hire & Train Professional Staff

Having a team of skilled and reliable staff who can provide great customer service is essential for the success of your tanning salon business. Here are some steps you can take to hire and train professional staff:

  • Create a job description: Clearly outline the roles and responsibilities of the staff you need. This will help you attract the right candidates for the job.
  • Post job openings: Advertise your job openings on job boards, social media, and your website and invite applications from potential candidates. Review resumes and conduct interviews to find the best fit for your team.
  • Set up a training program: Develop a comprehensive training program for your staff to ensure they understand the salon's policies, procedures, and product lines. Training should cover sales techniques, tanning bed operation, and product knowledge. Provide ongoing training opportunities for your staff to keep them up-to-date with the latest industry trends and products.
  • Make customer service a top priority: Train your staff to provide excellent customer service. This includes greeting customers with a smile, being attentive to their needs, and maintaining a clean and safe salon environment.
  • Motivate your staff: Implement incentives to motivate your staff to work hard and achieve your business goals. This can be in the form of bonuses or rewards for meeting sales targets, excellent customer service reviews, or attendance.

Tips & Tricks

  • Offer your staff discounts on tanning services and retail products to keep them encouraged and excited about their work.
  • Provide your staff with incentives to encourage them to sell more retail products such as tanning lotions, as this can be a significant source of revenue for your business.
  • Work with your staff to create a friendly and positive work culture that will encourage teamwork and unity among your team.

The success of your tanning salon business depends largely on your staff's ability to provide excellent customer service and promote your products and services. Make sure you take the time to hire and train professional staff who can help you take your business to the next level.

6. Prepare Location For Establishment

The location of your tanning salon is crucial to its success. Consider factors such as foot traffic, parking availability, accessibility, and competition in the area. Here are the steps to prepare a location for your establishment:

  • Research your target market. Determine your target audience and choose a location that will attract them. For example, if your target audience is young adults, choose a location near college campuses or popular nightlife areas.
  • Check zoning laws and regulations. Make sure the location you choose is zoned for business use and allows for tanning services. Contact your local government office or chamber of commerce for more information.
  • Secure a lease or purchase agreement. Negotiate a lease or purchase agreement with the property owner. Make sure the agreement includes details such as rent, lease duration, and maintenance responsibilities.
  • Renovate and equip the location. Once you have secured a location, renovate it to meet the needs of a tanning salon. Install tanning beds, air conditioning, mirrors, and seating areas. Hire a professional interior designer to create a welcoming and comfortable atmosphere for your customers.
  • Obtain necessary permits and licenses. Contact your local government office or health department to obtain necessary permits and licenses to operate a tanning salon.
  • Invest in marketing and advertising. Once your tanning salon is ready to open, advertise in local newspapers, radio stations, and social media platforms. Offer a discount or special promotion to attract new customers.

Tips & Tricks:

  • Consider offering mobile tanning services to reach customers who cannot come to your location.
  • Offer a loyalty program to retain customers and gain their loyalty.
  • Partner with local businesses to cross-promote your tanning salon, such as offering discounts to gym members.

By following these steps, you can ensure your tanning salon location is prepared for its grand opening and success.

7. Obtain Necessary Permits & Licenses

Opening a tanning salon business involves more than just finding a location and decorating the space. Before you can legally open your doors, you need to acquire all necessary permits and licenses. These legal documents ensure that you are following all state and local regulations, and they're a critical part of your business's success. Here are some of the necessary permits and licenses to obtain before opening your tanning salon.

  • Business License: This license is required in order to operate any type of business in your city or county. It grants you permission from the local government to legally conduct operations within their jurisdiction. The cost and requirements vary from city to city, so be sure to check with your local government to determine what's needed for your specific location.
  • Occupancy Permit: This permit is usually issued by the local government and varies based on location. The purpose of this permit is to ensure that your business location meets all safety and zoning requirements. This is especially important for businesses that have certain hazardous materials on site or that may have a high occupancy.
  • State Licensing: Most states require your tanning salon to be licensed. The licensing requirements vary depending on where you are located and the services that you plan to offer. You may need to obtain a cosmetology or esthetics license in addition to a tanning salon license.
  • Health Department Permits: In most states, you'll need to obtain permits through your local health department to ensure you comply with all health and safety codes. You'll likely need a permit for your spa or salon, and you'll need to follow specific guidelines for cleaning and sanitizing equipment.
  • Employer Identification Number (EIN): This is required by the federal government and is used to identify your business for tax purposes. You'll apply for an EIN through the IRS website.

Tips & Trics:

  • Be sure to research all the permits and licenses you need before starting your business. Failing to obtain a necessary permit can lead to fines or even the closure of your business.
  • Consider working with a legal professional to ensure that you're meeting all required regulations and obtaining the appropriate permits. They can also help you navigate the licensing process more efficiently.
  • Stay organized by keeping track of all permits, licenses, and other legal documents in a central location. This will make it easier to stay on top of renewal deadlines and help ensure that your business stays in compliance.

Obtaining all of the necessary permits and licenses can be a time-consuming process, but it's a critical step in opening your tanning salon. Failing to obtain the required legal documents can lead to fines, legal action, and even the closure of your business. Remember to keep track of all necessary documents and renewals, and work with a legal professional if needed to navigate the process more efficiently.

8. Market & Advertise The Tanning Salon

Congratulations on opening your tanning salon business! Now the work begins to spread the word about your business and get clients through the door. Here are some strategies to help you market and advertise your tanning salon:

Tips & Tricks:

  • Utilize the power of social media platforms like Facebook, Instagram, and Twitter to showcase your facility and services.
  • Offer promotions or discounts for first-time clients to get them in the door and keep them coming back.
  • Partner with local fitness centers or gyms to cross-promote your services to their customers.

Implementing these tips and tricks will help attract new clients and build a strong customer base. But there are more elements to consider when it comes to marketing and advertising your tanning salon business.

  • Develop a professional website that clearly showcases your services, prices, and location. Consider utilizing Search Engine Optimization (SEO) strategies to ensure your website appears high in search engine results.
  • Create eye-catching flyers, posters, and business cards to distribute in your local area. Be sure to include any promotions or deals that your tanning salon is currently offering.
  • Host special events or themed parties at your tanning salon to draw in new customers and create a memorable experience.
  • Consider setting up a referral program to incentivize your current clients to refer their friends and family to your tanning salon.

By implementing these marketing and advertising strategies, your tanning salon business will continue to grow and flourish. Remember to be consistent with your messaging and brand identity across all platforms, and always stay engaged with your customers to ensure their satisfaction.

9. Track & Record Service Data

One of the crucial elements of running a successful tanning salon business is to track and record service data meticulously. This ensures that you are delivering the best service possible to your customers and allows you to make informed decisions about your tanning salon business.

There are different types of data that you should be tracking as part of your tanning salon business:

  • Customer Information: Collect customer names, contact information, services rendered, satisfaction level, and feedback. Keep a database of customer records and track service history for each client.
  • Service History: Keep detailed records of service activity, such as the date, the service rendered, the duration of the service, and the technician providing the service.
  • Inventory Management: Keep updated records of inventory, such as supplies, equipment, and products used. Ensure that consumables such as tanning lotions and solutions are tracked to avoid running out of stock.
  • Financial Information: Track and record all financial transactions, such as sales, expenses, and profits. This allows you to manage cash flow and make informed decisions based on real-time financial data.

There are different ways to track and record service data:

  • Software: Invest in a good salon management software that automates customer data, appointment scheduling, inventory management, and financial tracking to manage your tanning salon business effectively.
  • Manual Tracking: Use pen and paper, or spreadsheets to manually track customer, appointment, and financial data. This method is best suited for small tanning salon businesses with fewer clients.

Tips & Tricks:

  • Always remember to get consent from customers to record their information before collecting any data.
  • Keep data secure and comply with data protection laws to avoid any legal issues.
  • Regularly analyze service data to identify trends and improve service quality, which will help attract and retain customers.

By tracking and recording service data, you will be able to identify trends, measure performance, and make informed decisions to drive the success of your tanning salon business. It will also help you provide better customer service and make your job as a business owner more manageable.

10. Listen To Feedback & Adjust Services

As you start your journey to open a tanning salon business, it is essential to keep in mind that nothing stays the same forever. The market is constantly changing, and your business must change with it to keep up. One way to ensure your business stays relevant is to listen to feedback from your customers and adjust your services accordingly.

Customer feedback is essential because it gives you insights into what is working and what is not. It is important to actively engage with your customers, whether through surveys, social media, or other methods, and ask them about their experience at your salon. If multiple customers have similar complaints, take it as a sign to make some changes. Act on feedback promptly to show your customers that you take their experiences seriously.

It is also essential to keep up with industry trends. Don't be afraid to try out new services or products. If your customers are looking for a new tanning method, it might be worth exploring. Good research will help you stay ahead of the competition and give you an edge in the market.

Here are a few ways to listen to customer feedback and adjust your services:

  • Conduct surveys online or at the salon to gather feedback from customers
  • Monitor reviews on social media, Yelp or Google to identify common complaints
  • Provide incentives for customers who leave reviews or provide feedback

Tips & Tricks:

  • Empower your employees to take action based on customer feedback, providing them with the tools and resources to make necessary changes.
  • Monitor the competition and be aware of what they're doing. Use industry resources and trade shows to stay up-to-date with emerging trends.
  • Consider offering a loyalty program or providing incentives for customers who refer others to your salon. This will help you retain customers and attract new ones.

Remember that listening to feedback and making changes is an ongoing process. Keep your customers engaged, and always be willing to make necessary changes to grow and improve your business.

In summary, the tanning industry is a lucrative business sector that requires careful planning and preparation if you want to establish a profitable tanning salon business. The 10-step checklist provided in this article, including developing a business plan, establishing relationships with suppliers, and obtaining necessary permits and licenses, will undoubtedly set you on the path to success. With an estimated $3 billion in revenue annually, the tanning industry presents a wealth of opportunities that you can capitalize on. Remember, hiring professional staff, tracking service data, and listening to feedback are vital to providing quality customer service and growing your business. So, put in the effort, invest in your business, and develop a long-term vision. With dedication and unwavering commitment, you'll undoubtedly join the ranks of successful tanning salons generating an average of $32,000 annually per salon.

Excel financial model

Tanning Salon Financial Model
  • 5-Year Financial Projection
  • 40+ Charts & Metrics
  • DCF & Multiple Valuation
  • Free Email Support