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Salon Operating Facts

This guide provides essential calculations for salon owners to determine rent costs, operator income potential, and overall operating budgets. By understanding the square footage of your salon, you can estimate monthly rents and establish yearly gross budget targets based on industry norms—where rent is typically around 10% of total operating costs. Learn how many operators you need to meet your budget while maximizing income through efficient service offerings based on calculated operating hours and haircut prices.

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Salon Operating Facts

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  1. Salon Operating Facts “Rent, Operator Potential and 10 Percent !”

  2. Operator Potential! • Objectives: • Given the square footage of a salon, you will be able to determine your rent costs. • Determine how much money you should you gross in order to stay within your operating budget • calculate the potential income of one operator in your salon.

  3. The Facts • Given: Your current landlord charges you: $5/square foot/month. (estimate) • The salon measures: 28ft. x 32ft. • One operator can complete 2 haircuts/hour • You charge $20/customer for a haircut • Your salon is open 5 days/week

  4. How do you cover the cost…? • Yearly rent cost = ? • How many operators do we need to cover the budget?

  5. How much is the rent? • 28 x 32 = 896 square feet • $5/square foot/month • $5 x 896 = $4,480 • rent = $4,480/month • 12 x $4,480 = $53,760 • Rent = $53,760/year

  6. What is the “gross budget” amount? • Rent = $53,760 • (because the rent is approximately 10% of the overall budget in a salon, multiply the rent by 10) • therefore the yearly gross budget target is: $537,600

  7. How much can one operator make? • $20/cut • 2 cuts/hour • 8 hours/day • 5 days/week • 50 weeks/year • $20 x 2 x 8 x 5 x 50= • = $80,000 • Yearly gross “cash flow” for one full-time operator!

  8. How many operators do I need to meet my annual budget? • $537,600 (yearly budget) • $80,000 (yearly cash flow per operator) • $537,600/80,000 = • = 6.72 operators • 6 full time people, and approximately 2/3 person, (part-time) • Note: this does not include any other “cash flows” you may make from product sales, perms, colors or other services you offer the customer.

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