How to Start a Nail Salon

Read our step-by-step guide on how to open a nail salon business. Includes detailed information and frequently asked questions.

Updated on November 5th, 2019

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According to Nails Magazine, an industry-leading publication, Americans collectively spent $8.5 billion on nail services in the U.S. in 2017. And during 2017-18, there were more than 56,000 licensed nail salons across the country.

Our guide contains everything you need to know about how to start a nail salon business - from registering as a legal entity to creating a presence on social media.

How To Start A Nail Salon

How to Start a Nail Salon:

1. Decide what type of nail salon you would like to open.

Decide which of the many types of nail salons you'd like to open; home-based, a retail nail salon in a busy suburb or mall, or a mobile nail salon.

Ask yourself the following questions:

What type of services will you provide?

Will you offer basic manicures and pedicures, or will you provide full-service treatments i.e. color application, acrylics, nail art, and massages?

Will you offer fancy decor and a relaxing ambiance with soothing music playing in the background, or a speedy in-and-out service with nail technicians set-up at stations around the room?

Do you have a cosmetology license?

What will make your business stand out from other nail salons?

2. Define your target market.

If you want to provide the best nail services in your area, you need to understand who your customer is.

Survey potential customers. Create a questionnaire and ask people in your neighborhood to fill it out to give you an idea of what treatments they like and are willing to pay for.

Figure out who your customer is. Will you target stay-at-home moms, busy professionals, or both? By knowing who your customer is, you will have a better idea of which services to offer, how to style your space, and advertise your services.

How to Start a Nail Salon Business Plan Checklist:

Download this free Opening a Nail Salon Checklist in Microsoft Word format.

Download PDF Instant download. No email required.

3. What is your competitive advantage?

Once you've completed your research and understand your customer's needs and expectations, you can now think about your niche i.e. what sets you apart from other nail salons, and how your salon will fit into the competitive landscape.

Which nail services are you skilled at? Perhaps you are skilled at acrylic nails, in which case your main service could focus on providing acrylic manicures and pedicures. If you'd prefer to offer all services, make sure you have the necessary qualifications and training to provide them.

Find your niche. Instead of serving all types of customers, you could focus on serving bridal parties, corporate functions, birthdays, or private functions. Or you could put together all-inclusive packages.

4. Create a nail salon business plan.

A business plan is a blueprint for your business. It outlines your financials, the cost of setting up, market research, and your projections for the first few years.

Market research is key. Focus on your market research and SWOT analysis because it is important that you understand the demographics of your location, and your competitors' strengths and weaknesses. By doing this, you will have a better idea of what type of products and services to offer and how best to optimize your business for success.

5. Form your nail salon business.

When you are ready to formally register your nail salon, there are a few key steps that you need to follow:

Choose a business structure. Before you register your business as a legal entity with the state, you'll need to select a business structure. There are several types of business structures to choose from, but the following options will ideally suit a small business like a nail salon:

  • Sole Proprietorship: One person.
  • Corporation: One to three people.
  • Limited Partnership: Two or more people.
  • Limited Liability Company (LLC): One or more people.

Choose a business name. If you haven't yet thought of a name for your nail salon, now is the time to do so. Think of a few names that you think would best describe the services you are planning to offer.

  • If you are a Sole Proprietor: Sole proprietors can use their name as the business name and will not have to register with the state. However, if you choose an alternate name for your business, you'll need to register under a Doing Business As (DBA) name.
  • Entity Name: Depending on your business structure and location, you may be required to register your business name as a legal entity name. This prevents another company from operating under the same name.
  • Trademark: If you plan to open a chain of nail salons, you would be required to register for a trademark.
  • DBA Name: Your location and business structure will dictate whether you need to register a DBA name. A DBA allows you to conduct business under a different identity from your own.

Do I need a registered agent?

If you register as a Partnership or LLC, you may need to hire a registered agent. A registered agent is an individual who is designated to receive "service of process" (SOP) correspondence, such as tax forms and notice of lawsuits, from the state.

Hire a third party to accept SOP docs on your behalf. While you can serve as your own registered agent, it is advisable to hire a third party to be responsible for receiving important documents, if for any reason, you are not available. Registered agent services cost between $100.00 and $300.00 per year.

Get a federal tax ID number (EIN) and state tax ID.

In order to open a business bank account, hire employees, and apply for a business license and permits, you'll need to get an Employee Identification Number (EIN). Fortunately, it's free to apply for one. All you have to do is go to the IRS website, complete your application online, and you'll receive your EIN immediately.

Find out if you need to withhold state income tax. In addition to Federal Tax, most states charge income tax, which requires employers to withhold earnings. However, if you are a sole proprietor you must report all income and losses on your personal income tax return - this is called a "pass-through" taxation. Note that there are seven states that do not charge state income tax; these are Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming.

Apply for a business license & seller's permit.

Now that you have registered your business and acquired an EIN, it's time to get your business license and permits.

Obtain a state/city/county license. Because you are opening a nail salon, you will not have to apply for a federal license, but you will need to get a state/city/county license depending on your location and business activities. Each state, city, and county has its own regulations, so visit your state's website to find out which licenses and permits you need.

Obtain a seller's permit. In many states, you will have to get a seller's permit in order to sell products in your nail salon. This is so that your state/city/county can charge sales tax on the transactions you make. If, however, you live in Alaska, Delaware, Montana, New Hampshire, or Oregon, you do not need a seller's permit as these states do not impose a sales tax.

Obtain a Cosmetology License. Only certified cosmetologists and nail technicians can run a nail salon business. If you don't have a cosmetology license, consider doing a board-approved course at a reputable college.

Open a business bank account.

Now that you have your federal EIN, you can proceed to open a business bank account.

Choose a bank account that suits your needs. There are several types of accounts that you can open, ranging from savings accounts to merchant accounts, which allows you to accept both debit and credit card payments from your customers. To open a business bank account, you will need:

  • Your EIN or Social Security Number (if you're a Sole Proprietor).
  • Business license.
  • Business formation documents.

Apply for business insurance.

Buy insurance to protect your business and personal assets from unexpected risks, such as a lawsuit or property damage.

Provide insurance for your employees. If you have employees, by law you are required to provide workers' compensation, as well as unemployment and disability insurance.

Speak to a professional. We recommend speaking to an insurance agent to find out what insurance coverage is best for your needs. You can also refer to our 2019 Guide to Small Business Insurance.

Select the right software.

Purchase a Point-of-Sale system. In retail, merchants use a Point-of-Sale system to process sales and accept cash and credit cards. There are many POS systems available, with pricing between $0.00 and $99.00 per month.

A POS will help you to keep track of your sales and allow you to manage your expenditure and inventory effectively. And if you integrate the POS with your accounting system, data will automatically be saved making your salon more efficient.

Purchase software to manage your business smoothly. If you are running a nail salon with several employees, you'll need to get salon management software to manage all your appointments and inventory management software to keep track of your stock. Salon management software ranges from $0.00 to $129.00 per month. Inventory management software costs between $0.00 and $199.00 per month.

6. Secure funding:

To get your business off the ground, you will need to get start-up capital in order to rent a space, obtain licenses and permits, and purchase inventory etc.

Work out your costs and make projections. Be as realistic as possible and model a best-case scenario as well as a worst-case scenario. If financials are not your strong suit, we suggest hiring an accountant.

Nail Salon Financing Options:

Self-Funding: One of the most popular ways to acquire start-up capital is through bootstrapping. Most financial experts recommend investing your own personal savings into your business because you won't have to repay anyone later.

Loan from Family & Friends: Another option is to get a loan from family and friends who may offer more favorable loan terms than banks and alternative lenders.

Get a Business Credit Card: Many start-ups use personal or business credit cards to obtain funding for small purchases, such as equipment and supplies, to start generating cash flow.

Get a Small Business Loan: To get a small business loan you will need to have a business plan, a decent credit score, and projections for the next few years to assure the lender that you can repay them. Compare offers to get the best rates and terms.

Try Crowdfunding: The advantage of crowdfunding is that there is low risk due to the fact that crowdfunders do not receive a share in your business and typically don't expect anything in return.

Apply for an SBA Loan: The Small Business Administration provides low-interest rate loans to businesses who do not qualify for traditional financing. There are six different SBA options to choose from guaranteeing loans up to $5 million.

7. Pick a location for your nail salon.

Your location will depend on what is convenient for your target market, local zoning laws, available spaces, and pricing.

Choose a location based on your target market. Considering the demographics of your target market will help you determine where the best location for your nail salon should be. For example, if you're targeting busy female professionals, you could provide a mobile service by traveling to clients' homes or place of work. Or you could lease a space inside a business park.

Potential zoning restrictions. Regardless of whether you're opening a home-based or retail nail salon, be sure to check what commercial activities your city or county allows in your neighborhood to avoid violating any zoning regulations.

The cost of opening a retail location. A retail nail salon will cost between $100,000.00 and $300,000.00 to build from the ground up. The most economical option is to rent retail space, such as a former hair salon or restaurant that already comes equipped with power and water.

Nail salon size and dimensions. The size of a nail salon is 1,000 - 1,500 square feet. The area size of a manicure station is roughly 16 square feet, with the space required for a pedicure being double the size at 32 square feet. Your retail and reception area will fit into roughly 100 square feet. That means you'll be able to fit 10-12 nail technicians into an average size nail salon.

8. Setting up your nail salon.

Refurbish or furnish your nail salon. If you hire a retail space, you can refurbish and turn it into the nail salon that you envision. Rental prices vary and will depend on your location. Good locations include shopping malls or areas with high foot traffic, close to restaurants and shops. Keep in mind that these areas will probably charge higher rentals, so you will need to balance out the costs of attracting clients and the amount of space you can afford.

Obtain a Certificate of Occupancy. When renting a retail space, you will need to get a Certificate of Occupancy from your local government, which is a legal document that shows that you comply with all building regulations and that your space is safe to be occupied. If you're renting a space, it's likely that a CO already exists on file, in which case you can purchase a copy. The cost of a Certificate of Occupancy varies from state to state, but you can expect to pay between $100.00 and $1,000.00 depending on your county or city.

Purchase supplies & decorate your space. Some of the items that you will need to run your business day-to-day include essential items and equipment like manicure stations and chairs. After you've stocked your inventory, you can decorate your space to make it look attractive to clients.

Essential Amenities and Supplies for a Nail Salon:

Item

Price

Nail polish

$2.75 - $10.00 per bottle

Gel polish

$7.00 - 15.99 per bottle

Acrylic Nail Primer

$7.95 - $49.95

Acrylic Nail Liquids

$32.25 for 32 oz

Acrylic Nail Powder

$49.00 - $54.95 for 24 oz

Nail tips

$6.95 for 100

Display shelves

$4.50 - $25.00 ea

Supply carts

$43.00 - $89.99

Moisturizer

$14.99 per gallon

Nail application brushes

$5.00 - $28.00

Nail files

$4.00 - $10.00 for 50

Nail buffers

$0.99 - $20.00 ea

Acetone

$7.50 for 32 oz

LED/UV lamps

$13.99 - $79.99

Foil wraps

$5.49 for 100 pcs

Lint-free nail wipes

$7.99 for 1000

Nail clippers

$1.25 ea

Cuticle pusher

$0.75 - $9.25 ea

Cuticle nipper

$7.95 - $27.95 ea

Paper towels

$0.02 - $0.03 ea for pack of 200

Cotton towels

$0.10 - $7.00 for pack of 500

Manicure tables

$199.00 - $499.99 per set

Pedicure chairs with footrests

$70.00 - $890.00 per set

Reception counter

$189.00 - $1,300.00 ea

Chairs for the waiting area

$20.00 - $36.00 ea

Toilets and wash basins (if applicable)

$89.00 - $500.00 ea

Outdoor sign

$13.50 - $250.00 ea

Getting signage and branded materials. You'll also want to attract people passing by with an outdoor sign, and provide other branded materials like price lists. In your business plan, you should have included an itemized inventory of all the supplies you will need. Look for a wholesale supplier in your area who will enable you to purchase all your supplies in bulk at a discounted rate.

9. Determine your pricing strategy.

Your pricing strategy depends on your financial projections, target market, competitors, and available funds. With the competitive landscape and target audience considered, it's important to find a price point that will attract customers and allow you to turn a profit.

Do a sales forecast. Doing a sales forecast and projected profit and loss statement will assist you in defining the right price point that creates a profit and is still attractive to customers.

Average Pricing for Nail Salon Services (2017-18):

Basic Manicure

$20.93

Deluxe or Specialty Manicures

$30.85

Full-Set Acrylic Nails (Sculpt or Tips)

$45.56

Acrylic Fills

$30.57

Basic Pedicure

$33.56

Deluxe or Specialty Pedicures

$45.96

Gels (traditional or hard gels)

$29.41

Acrylic Dip System (Full Set)

$38.83

Gel Polish (using a polish-like brush)

$29.72

Hybrid or long-wearing nail polish manicures

$26.86

10. Hire employees.

Hiring the right employees takes time and effort. It's important to follow a structured process that will help you to find and hire the right candidates for your nail salon.

Decide how you will pay your staff. Will you only pay your staff a base salary or will they also earn a commission? Manicurists and pedicurists earn a median wage of $23,230.00 per year or $11.17 per hour, according to the Bureau of Labor Statistics.

Follow these steps when you're ready to start hiring:

  • Write a job description.
  • Post on a job board.
  • Review applications and resumes.
  • Interview candidates.
  • Check references.
  • Send a job offer letter.
  • Fill out the mandatory IRS forms.
  • Train employees.

Use hiring tools to find employees. There are many hiring tools and job posting software that you can leverage to help you find and hire the best nail technicians. You may also want to use an applicant tracking system to help organize your process. Once you've hired employees, get them to fill out and return Form W-4 for tax purposes.

Set up payroll for your staff. Next, you'll set up payroll and schedule pay periods to withhold taxes for the IRS. If you prefer to outsource this task, you can hire a payroll company to do it for you.

Consider offering your employees the added benefit of a good retirement plan. There are many small business retirement plan options to choose from. They will help you, as the owner, save as well.

11. Have a soft opening to attract customers.

A great way to attract customers to your nail salon is by hosting a soft opening. Create a digital invitation and invite your friends, family, and businesses close by to a low-key event at your store before the opening date.

Offer customers a discount or birthday special. This is a great way to let people know about the new nail salon in the area and what they can look forward to. Perhaps you'd like to offer customers a 10% discount on their first manicure or offer guests a birthday special. Whatever you decide, a soft opening is a wonderful opportunity for you to meet your future clients and encourage them to support your business once you're open.

12. Sanitation in the nail salon.

Ensure that cleanliness standards are followed. Careful steps must be taken to keep nail salon instruments clean, as it is easy for bacteria, fungi, and even viruses to be transferred between customers and employees.

The U.S. Environmental Protection Agency has published a guide for nail salon owners titled "Protecting the Health of Nail Salon Workers," which provides best practices related to sanitizing instruments and ensuring safety and cleanliness in the salon. State and local requirements may differ, so be sure to contact your local cosmetology board or state health department for more information.

13. Market your Nail Salon.

Marketing will help to spread the word about your nail salon and allow you to build a strong client base. Depending on your budget, there are many ways to market a small business.

Local SEM & Social Media Marketing:

Nail salons can benefit from having a social media presence and incorporating search engine marketing into their strategy.

Create social media profiles. Social media is a great way to build brand awareness, engage with current customers, and attract new ones. Since your services are visual, open an Instagram account to display your salon's manicures and pedicures. Customers are always on the look-out for proof that your nail salon meets their expectations of quality service.

Make sure you appear in an internet search. Does your nail salon pop up on Google when you search "where can I find the best nail salon near me?" You can boost your chances of appearing in local search results by creating a profile on various business platforms and signing up for Google My Business and Yelp!. There's also Pay-Per-Click (PPC) advertising for boosting traffic to your website.

Take an online course. If you're not skilled in social media management, consider taking an online SEM/SEO course or contact a local agency to help you reach your marketing goals.

14. Sell retail products to increase your revenue.

Depending on your target market, sell premium nail care products that are not available in drug stores and shops. Think high-end nail polish brands like Morgan Tailor and OPI. Bear in mind that holding this stock will also create a cash flow need, which needs to be factored into your financial projections.

Stock retail products for walk-in customers. Consider stocking moisturizers, cuticle oil, nail clippers, and other products related to hand and feet maintenance. This will entice your clients to buy additional products to take home with them, and also attract people walking by.

Draw attention with a beautiful display. Decide on the most appropriate way to display and stock your high-end products to create awareness and allow customers to browse and buy these products easily.

Real-World Tips, Tricks, and Strategies from Successful Nail Salon Owners:

Source

Quote

Sarah Gibson Tuttle - Olive & June

I like making people happy. If you don’t get feedback, if you’re not constantly evolving and changing and listening to your clients, you lose them. Especially on the little things.

Cinnamon Bowser - Nail Taxi

For long-term success, you have to figure out ways to grow your company. Once Nail Taxi was managing house calls and doing home parties, I took time to think about new directions. After laying the groundwork, companies were calling me! Eventually I began doing in-store retail events, corporate promotions and even New York Fashion Week.

Ale Breuer and Kim Marsh - Ezza Nails

We are completely cashless, have a 15 percent baseline tip included in the prices, and offer membership options and convenient hours. You can choose your polish color during your online booking.

FAQs:

How Much Does A Nail Salon Owner Make

How much money can you make owning a nail salon?

Nail salon owners earn between $40,000.00 and $60,000.00 a year on average.

Read our guide on how to start a nail salon.

How do I start my own nail salon at home?

  1. Get experience working at a nail salon.
  2. Do in-depth market research.
  3. Seek advice from other business owners.
  4. Create a business plan.
  5. Choose a business structure.
  6. Register your business as a legal entity.
  7. Get your EIN and state tax ID.
  8. Apply for business licenses and permits.
  9. Open a business bank account.
  10. Purchase supplies & furnish your space.
  11. Get the word out that you're open for business.

Read our guide on how to start a nail salon.

Is a nail salon profitable?

Research shows that $8.36 billion were spent on nail salon services in 2018. So while it is difficult to say how profitable an average salon is, the industry is a large one and is growing at 2.2% every year.

Read our guide on how to start a nail salon.

Do You Need A License To Open A Nail Salon

Do you need a cosmetology license to own a nail salon?

No, but your nail technicians must have completed 1,000 to 3,000 hours of training in a state-backed cosmetology school or apprenticeship program and completed an exam.

Read our guide on how to start a nail salon.

How To Market A Nail Salon

How do you market a nail salon?

  1. Purchase a domain name and set up a professional website.
  2. Upload photos of your best work to Instagram.
  3. Register with Yelp! and encourage customers to rate you.
  4. Encourage customers to follow you on Facebook.
  5. Register on Google My Business.
  6. Set up e-mail and/or SMS marketing.
  7. Hold sales events and giveaways.
  8. Advertise in the local newspaper.
  9. Post flyers.

Read our guide on how to start a nail salon.

How Much Does It Cost To Start A Nail Salon

How much does it cost to start a nail salon?

Our estimates show a total start-up cost of between $40,000.00 and $125,000.00, including the cost for stock and consumables of $20,000. During your cost projection include the costs of furniture, equipment, shopfitting, stock, etc.

Read our guide on how to start a nail salon.

How do you manage a nail salon?

To manage a nail salon you need to manage appointment and staff schedules, process sales and payments, keep records of inventory, and make sure the place runs smoothly and efficiently. There is a wide range of salon management software you can buy to help you.

Read our guide on how to start a nail salon.

Essentials For A Nail Salon Business Plan

What are the essentials for a nail salon business plan?

  • Executive Summary.
  • Company Overview.
  • Market Analysis.
  • Organization Management.
  • SWOT Analysis.
  • Sales & Marketing Strategy.
  • Funding Needs.
  • Financial Projections.

Read our guide on how to start a nail salon.

Local Sem Essentials For Nail Salons

What are local SEM essentials for nail salons?

  1. Register for Google My Business
  2. Start a Yelp! profile.
  3. Create a Facebook account.
  4. Take images of your nail services.
  5. Upload images and descriptions to all your accounts.
  6. Encourage customers to rate you.
  7. Research pay-per-click marketing.

How do I become a nail technician?

To become a certified nail technician, you must have a GED or high school diploma, graduate from a Board-approved college or apprenticeship program, and complete a set number of experiential training hours. Depending on your state, you might also need to pass a National Institute of Cosmetology exam.

Read our guide on how to start a nail salon.

How long does it take to become a nail tech?

Depending on the type of course you choose, it will take between 9 and 36 months.

How much do nail technicians make?

Manicurists and pedicurists earned an average of $23,230.00 per year or $11.17 per hour in 2017.

How do nail techs get paid?

Payment varies from salon to salon; however, nail technicians either earn a base salary plus commission or work on a commission-only basis.