If you have stumbled in here then you probably already own a beauty salon or thinking about starting one. With more national brands entering this space, the beauty services industry is slowly but surely getting standardized and organized. It almost seems as if there are too many beauty salons already. So, the BIG question is – Is it too late to start a beauty salon in India?
To answer this question, we need to first understand how the salon industry works, the demand, growth potential, what it takes to succeed in this space, and more importantly the financials. The growth of beauty industry has been phenomenal over the last decade in India. If KPMG numbers are to be believed beauty industry is expected to double in size from the current 40,000 crores to 80,000 crores in the next 3 years. Now let’s look at some of the key components to determine if it’s worthwhile to get into the beauty business.
The growth of the beauty industry has been dramatic in India — now more than ever, Indian men & women across income levels relish treating themselves to the latest and greatest beauty treatments. Thanks to television and Bollywood, Indians have become more aware of new trends and demand an ever-expanding range of services for their hair, skin and nails from local beauty salons. The result is that beauty salons can be seen in almost every neighborhood and street, from low-income neighborhoods to busy streets and markets to posh suburbs.
It is fairly simple to start a beauty salon in India: It can be a one room shop or a very fancy spa. There are various consulting companies who specialize in interior decoration specifically targeted towards salon aesthetics. Online B2B beauty platforms like Beauty Junction provides a one stop shop for buying everything you need to launch your salon. While the infrastructure needed to start a salon is relatively easy to acquire, formal training is a must! It is important to get proper training, both in classes and as an assistant to an experienced beautician, before opening your own salon. This experience is also important if you are thinking about taking a loan from a bank, as it might play a role in their decision making process.
The most successful beauty salons have a steady client base that makes regular visits. One way to achieve this is to offer multi-treatment packages for higher-margin services that require regular visits. While threading and waxing are often the entry points for a new client, salon owners are also beginning to offer treatments such as “hair spas” to fortify hair, prevent hair loss, repair split ends, or moisturize dry hair. Such packages require clients to come once, twice or up to four times a month for the treatment, depending on their budget and needs. “Bride-to-be” packages are also on trend. These entail multiple visits over 2-3 months, and can be highly profitable for savvy salon owners. As product cost plays an important role in determining the profit of your salon, it is very important to source the right products from the right supplier at the right price. Using online wholesale B2B portals like Beauty Junction not only gives you access to the latest products, furniture, and beauty equipment but also saves you upto 60% on product purchases since you are buying directly from the manufacturers.
Salons have to create a unique and “special” experience for customers in order to be successful. As Women’s World Banking’s Manager of Financial Education, Marketing and Product Research Cathleen Tobin explained, “beauty is emotional and a bit mysterious”. One owner they interviewed explained, “Customers expect you to be the expert, so you have to be. That builds their confidence in you.” Women clients trust knowledge, expertise and qualified training; these qualities, together with interpersonal and sales skills, are critical to success.
Owning a beauty salon is not all easy profit. One risk is that it is a seasonal business. Bridal packages may be a reliable way for salon owners to earn extra profit, however marriages in India take place only during specific months of the year. This means that salon owners need to find ways to promote their business with other services during slow seasons. There is also the risk of product waste, especially during summer months, due to low activity and high temperatures that can damage some products. So, it is very important that you only keep 15 days stock to avoid wastage. This could be achieved by planning product purchases and ordering online from ecommerce portals like Beauty Junction who provide doorstep delivery anywhere across India. One other tactic employed by salon owners to bring customers in during the hot summer months is to give promotional packages at steep discounts. This is particularly useful for treatments like waxing, which are regular services.
Another challenge is the need for beauty salon owners to have a continuous presence in the salon and for them to be involved in everything related to the business. According to Cathleen, “if the owner cannot work, the business may suffer”. Likewise, as market competition grows, so does price competition on basic services.
Despite these challenges, starting a beauty salon appears to be an attractive option for individuals who want to be self-reliant. Salons are cost-effective, with high profit margins and low startup costs. In addition, the sector is growing; as Cathleen noted, “women love beauty around the world and Indian women are no different.” So, it’s still NOT too late to start a beauty salon in India.