Operating Costs & Revenues

When possible, give yourself time to get the job done. The plans take at least three weeks to do correctly if the designer does not already have a backlog. The fixtures can take up to six or eight weeks to come in, so order early. Construction will range from three to eight weeks, depending on size, complexity and many other variables.

Costs have an incredible range. Many designers maintain that they have been involved with 1,000-square-foot installations that cost $200 per square foot, and others four times the size that came in at only $5 per square foot. Design, material and labor are all factors that make every job a unique situation.

The simple picture presented above is made more complex by the addition of retail products to the salon business. A new level of expenses and profits must be factored into the calculations. The simplest way to visualize the scenario is to view the expenses and profits for the salon and retail operations separately and add them together at the end.

The costs are somewhat different in every situation, but from the foregoing, the salon operator can see that a retail operation will create many more challenges for his business than will an operation that is geared strictly to service. Still, most salon people can get some idea of what the total profit/cost analysis would be for each operation independently by figuring the following equations for both the salon and retail sides of the business. The simplified equation tells the salon owner how much it will cost to provide a product or a service and this is how much must be charged to make a profit. At times, the figures are startling and revealing.