Opening a Nail Salon Business in 15 Easy Steps

The beauty industry is a great place for creative minds, who enjoy interacting with people. So, if your nails are always on point and you love helping others look and feel fabulous, opening a nail salon business might just be the perfect idea for you!

The global nail salon market size was valued at USD 11.00 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 8.0% from 2023 to 2030. 

In the US, there are around 56,300 individual nail salons and 395,600 nail technicians. In fact, nail care makes up nearly 16% of the $42.8B beauty salon market with an annual spend of $8.36B. That’s a lot of money being spent on the perfect pedicures.  

Despite the inevitable impact of the pandemic — the nail salon industry declined 19% from 2019 to 2020 — the beauty market is already seeing a rebound. Industry experts predict it will grow at an average of 9% annually for the next couple of years, as more people return to salons for their regular beauty treat.

So, What Are the Benefits of Owning a Nail Salon?

1. It's quick to get started

All you need to do is create a legal business entity with insurance and a license, and you’re ready to go.  

2. You can make a great living

Once established, a salon owner only has to worry about standard operating costs. Barring the high initial investment, running costs are comparatively low. The rest of the profits are yours!

3. It’s a rewarding job

When your creative efforts make people look and feel amazing, you’re certain to come home with a smile on your face every day.

4. High client retention

Once you’ve established a great relationship with your guests, they’re likely to stay loyal to your business for years to come.  

Now you know the benefits, let's look at how you can get started.

How much does it cost to start a Nail Salon

The costs of opening a nail salon can vary based on factors such as size, location, equipment quality, and staff. To attract and retain loyal and well-paying customers, your nail salon must be aesthetically appealing, deliver professional services, use good quality products, and the business must run efficiently. The comprehensive breakdown of costs for opening a nail salon involves various aspects, from rent and equipment to licenses and marketing.  

The initial costs of opening a nail salon include:

1. Lease or purchase of a location

2. Renovation and design costs

3. Equipment and furniture

4. Utilities

5. Inventory

6. Licenses and permits

7. Training and certification costs

8. Insurance

9. Software

10. Marketing and advertising costs

So, in the US, if we look at the more luxurious end for remodeling and furniture, the total cost of opening a nail salon can go up to: 

• $25,000 to $120,000 for rented spaces
• $170,000 – $480,000 for purchased spaces

You need to have a good understanding of the costs involved to know how to handle all these, and optimize your costs, wherever possible.

Thinking about starting a med spa? Discover the investment required!

How Profitable is Owning a Nail Salon

Nail salons in the US, can expect an average profit margin ranging from 15% to 45%, depending heavily on how well the salon owners manage their operations and control costs. The profit margin hinges on a delicate balance between revenues and expenses. Keeping a tight ship on the operating expenses, clever marketing, business automation, and a strong online presence will keep a check on the budgets, while keeping the customers flowing in.  

Related post: Are medical spas profitable? Read a guide to maximizing medical spa revenue.

You might be surprised to learn that opening a nail salon business is relatively simple. If you've already learnt how to create beautiful nails and you have some business know-how, you’re halfway there.

While some of the initial paperwork might seem daunting, you only have to do most of it once before you can add ‘business owner’ to your CV. Follow our 10-step checklist to starting a nail salon business, and you’ll be ready to open your doors before you know it:

1. Create a Nail Salon Business Plan

A business plan is a document that details a company’s goals and how it plans to achieve them. A well outlined business plan for nail salon gives you clarity and direction. For start-ups, it also helps winning over potential investors and lenders.

Creating a business plan for your nail salon will help you outline your business goals, and how you will achieve them. It will help you determine what you need to launch and grow your nail salon business successfully.  

You will  also use your business plan to secure business loans or startup capital. Banks and investors will need to see the roadmap for your nail salon business, particularly your market analysis and financial information.

A solid business plan for your nail salon should include:  

• Industry Analysis – Include details on the industry size, your target market, growth forecast, industry trends, competitors, suppliers, etc.
• Company Analysis – This segment should include details on what services you will offer (like nail art, acrylic nails, and gel manicures and pedicures), location, management, employees, anticipated start-up costs, ongoing expenses and expected profits
• Customer Analysis – Detail your target customer profile, desired customer segments, their demographics, and psychographic profiles.  
• Competitive Analysis – Include details on your direct and indirect competition, your nail salon's niche and competitive advantage, your competitive pricing strategy, etc.  
• Also read about How to open and create a plan for opening a Salon Business  

2. Assess your business needs  

Start a nail salon by drawing up the blueprint for your salon. Consider what type of business you want to run: do you want to have employees or renters? Are you offering a budget or a luxury service? Is there a particular niche you’d like to get into?

Study your competition and make sure that your nail salon will stand out, then set your prices accordingly.

Create a detailed budget to match your nail salon business plan and remember to include some margin for unforeseen costs. Raise, save, or borrow the funds you need.

3. Choose your business name

Your business name defines the identity of your business, so ask yourself:

• Is it simple and easy to pronounce?
• Is it memorable?
• Is the name too similar to another nail salon?
• Does the name communicate your niche or personality?  
• What will others think of the name?

Tip: remember to check social media platforms for similar names to ensure your future clients won’t confuse you for someone else!

You’ll also want to consider if a website address for your salon is available to buy (such as www.zenoti-salon.com), and whether anyone has trademarked the name. Search your state’s business records to avoid duplication.

4. Create a legal entity

What type of business is a nail salon? Under the North American Industry Classification System, commonly referred to as NAICS, beauty salons are classified within category 8121, which pertains to Personal Care Services. This is where the paperwork comes in; it’s time to legally register your nail salon business. Depending on your type of investment and the number of owners and partners, your business structure can be a sole proprietorship, partnership, limited liability company (LLC) or a corporation.

Typically, a nail salon is formed as an LLC. This protects you from personal liability and is less complicated and restrictive than the other models. The cost of forming an LLC includes the fee to file your LLC's articles of organization with the Secretary of State, business licensing and permits, and a few other fees depending on what state you’re in.  

5. Complete tax registration

The next step is to register for local, state and federal taxes. To do this, you first need an Employer Identification Number (EIN), which is used for tax administration — like a social security number for your business. You can apply for an EIN online.

The taxes you pay and the benefits and exemptions you receive will vary depending on what business structure you’ve chosen. There are five general types of business taxes, and you’ll need to check your state regulations to see what applies to your business.  

6. Get licensing and permits  

Acquiring licenses and permits can be one of the more challenging tasks of setting up a nail salon business. There are specific requirements depending on your location, so it’s important to do your research. But as a quick overview, here are a few you may need:  

• State Cosmetology or Beautician’s License: every state has specific requirements for cosmetology. You’ll need a nail technician license, which requires completing a formal nail technician program or apprenticeship and a licensing exam.
• Salon Business Operation License: Your business requires a license to legally operate in the state of your choice. Check with your local/state Chamber of Commerce, the US Small Business Administration, or City Hall to figure out what kind of business license you need.  
• Salon Retail Seller Permit: If you intend to sell products in your salon, you’ll need a seller’s permit. Again, this comes under the jurisdiction of local/state regulations.  
• Certificate of Occupancy (CO): The certificate confirms that the building is suited for your business and complies with building codes. If you’re building a new location, a review of the building codes and zoning requirements will be necessary. A CO can be obtained at City Hall.  
• Building permits: If you intend to renovate part or all of the building, you’ll first need a building permit that ensures the space is suitable and safe for reconstruction.  

7. Arrange banking and accounting  

Once you have your EIN, business plan for your nail salon, ownership, and licenses, the next step is to open a business bank account. Having a separate bank account for your nail salon business is mandatory, but it also makes accounting and tax filing much easier.  

Choose a bank that offers flexible and affordable services, maintenance fees, and transaction limits. It’s also a good idea to get a business credit card, especially one offering perks that can be reinvested in your business. A credit card will help build your company’s credit history, which can be beneficial if you later want to raise funds for investment. However, keep an eye out for hidden charges and limited offers.  

It’s important that you keep a record of your expenses and sources of income. These must be accurate and detailed, as they will allow you to track your business’ financial performance and will support your annual tax filing.  

8. Choose business insurance

If your business is an LLC or a corporation, your personal assets will be protected from lawsuits for the most part. Nevertheless, unforeseen issues can arise and business insurance can protect against some incidents and losses. Even where it’s not mandatory, it’s still highly recommended.

Different states have different mandates for business insurance, but the federal government requires all businesses that hire employees to have workers’ compensation, unemployment, and disability insurance. For information about additional insurance requirements, visit your state’s website.  

Here are six other common types of business insurance you might need:

• General liability insurance
• Product liability insurance
• Professional liability insurance
• Commercial property insurance
• Home-based business insurance
• Business owner’s policy

9. Secure Financing for your Nail Salon

The average cost of a nail salon startup ranges from $25,000 to $500,000. Where your business falls in this range depends on your location and the scope of your business.

You will mostly need a business loan or other outside financing for your nail salon. And this is where your business plan comes in. You should have a solid, well researched and thoroughbusiness plan for nail salon which can be defended when you meet with lenders or potential investors.

When preparing your loan application, make sure to include all the fixed and ongoing costs for opening your nail salon business, such as:

• Rent and utilities
• Equipment procurement, repairs and maintenance
• Supplies and inventory
• Business insurance
• Payroll & Staffing
• Marketing & advertising
• Software and automation

Your loan application must be in good faith, with all authentic numbers and projections.

10. Pick a space and set it up

Back to the fun stuff! Choose the right location for your budget, while considering ease of access and how many people might walk past your space regularly. It’s also worth noting if there are many other nail salons in the area.

Create a great ambience in your salon by choosing the right equipment, lighting, and furniture. Then connect with reputable brands and products to use and sell in the salon. The look of your salon should reflect your niche and personality.

Read more: 6 salon interior design tips for 2022

11. Find the right staff

Before you begin the hiring process, make sure your payroll system and employee benefits are set up and your workspaces and equipment are ready for use.  

The skills and personality of your nail technicians can make or break your salon’s reputation, so hire carefully. Find providers who’ve taken qualifying examinations in State Approved Cosmetology or Nail Technician Programs, and who have valid, up to date licenses and prior hands-on experience (no pun intended). Ask for recommendations from previous employers or from their regular guests.  

Above all, ensure your employees are personable, talented, and trainable.  

Tip: here are eight ways to support your staff to maximize their success.

12. Purchasing salon equipment and supplies

Make an exhaustive list of all the equipment and supplies you will need to starting a nail salon business. And ensure everything you need for immediate operations is procured before you open your doors. Given below is a list of equipment and supplies to help you get started

• Manicure and pedicure stations and chairs
• Sanitizing and ventilation equipment
• Nail polish and nail care inventory (including cuticle oils, lotions, and clippers)
• Nail polish and product displays
• Curing lamps and dryers
• Decor and furniture
• Point-of-sale (POS) technology

In the beginning, consider procuring only what is essential for your business. Look for good deals, second hand equipment, and leasing options. This will help you keep your costs down.

Invest in good nail spa management software, which will automate appointment scheduling, payments and even marketing capabilities. This will help you efficiently run the business from day one and reduce your manpower costs.

Ready to transform your salon experience with an online Scheduling app? Check out this related post

13. Let people know you’re open  

The nail salon business is highly profitable, but it’s competitive too. Here are a few marketing techniques to help you attract and retain guests. You can also:

• Advertise in local media announcing your opening and promoting your services
• Participate in local events to improve visibility
• Sponsor local events that cater to your target audience
• Invest in billboards and posters
• Create a great-looking website that makes you easy to find on Google
• Make a business listing to appear on search engines
• Run targeted paid ads on Google
• Update your social media frequently with relatable content
• Use email and SMS marketing to keep in touch with guests

Discover more must-have marketing strategies for salons.

14. Find the right technology to maximize clientele growth

It is imperative to find and use the right technology when you start a nail salon business. A good nail salon management software will increase your efficiency, reduce your costs and maximize your clientele growth. It will also give your clients a great customer experience from even before they step into your nail salon.

A good nail salon software includes all the following capabilities, in a single interface and can be used seamlessly across various locations.

• Appointment scheduling
• Online booking
• Digital payments
• Branded mobile app
• Automated marketing
• Social booking
• Real-time reports

Zenoti offers one of the best nail salon software, which will be a great choice for your business.

15. Reduce Risks and Liabilities 

Like every other business, where risks are inevitable, nail salons also carry some inherent risks. The main operational risk is that of injury to clients and staff. Some of the common risks emanate from:

• Chemicals - Many toxic chemicals are used in nail salons. Your nail salon should be well-ventilated to avoid overexposure. Follow the Occupational Safety and Health Administration's (OSHA) regulations concerning health hazards in nail salons.

• Sanitation - Sanitization is critical in nail salons. All technicians should be well trained in sanitizing tools and equipment. Any lapse in sanitation or failure to keep equipment clean causes infections and possible personal injury lawsuits.  

Carefully review your business activities and take steps to reduce the risk of injuries.

Five Nail Salon Decor Ideas

1. Choose the Layout

The nail salon design layout you choose sets the base for all the other decorating and furniture decisions. A good layout will have light, air and even people moving comfortably through the space. While choosing the layout, take into account and architectural features or limitations, especially in a rented space

Some nail salon layout options include:

• An open layout with minimal walls, which allows efficient use of equipment and an illusion of a large space.  
• A narrow layout with a shared center workspace and wall mirrors, giving the interior a trendy, modern feel.
• A multi-room or suite layout, which offers luxury manicure/pedicure services to clients who want privacy.
• A small multi-purpose layout, great for low budget small nail salons, using multi- functional furniture, allowing different services to be performed in an area with limited space.

2. Pick a Theme

Set the tone for your interior by unifying everything under a single theme. This will make choosing everything from the lighting on the ceiling to the coffee table and chairs in the waiting area easier.

Some options are:

• Modern: Furniture and equipment are new and sleek, with small footprint, creating lots of space. Add a few modern décor items that stand out.  
• Minimal: A clean, elegant and simple space with light-colored walls, recessed storage or shelves, and minimal furnishings. This décor opens up a small space.
• Vintage: Create a retro look using vintage furniture, bright colors and some unique art on the wall. Take inspiration from a specific decade or mix a few together.
• Luxury: A glamorous ambiance that speaks luxury, and makes guests feel pampered. Invest in comfortable seating, elegant light fixtures and wall décor that looks “upscale”.
• Natural: For an eco-friendly aesthetic, include wooden furnishings and natural fabrics, maximize natural lighting and add a few plants.

3. Decide on Your Color Scheme and Lighting

The color scheme and lighting you choose will create an atmosphere that represents your brand and makes guests and staff feel comfortable. You may choose colors that might be the same ones on your business logo or choose to go with a lighter wall color as it reflects light and brightens the space.  

Salons need a variety of lighting, such as overhead lighting and task lighting. Spend time on choosing the right ones, as lighting makes all the difference. Your customers will prefer soft overhead lighting, but your technicians will require bright task lighting to focus on a client’s nails. Balance the lighting carefully to meet all these requirements.

4. Hire a Professional

Hiring a well recommended nail salon design professional will be one of the smartest decisions you will make. They will have beautiful nail salon design ideas, keeping your unique requirements in mind, and will also have access to suppliers and resources to make the whole project seamless and cost efficient. Hiring a professional will save you a lot of time, money and stress, allowing you to focus on other important aspects of the nail salon business.

5. Nail Salon Decor to Best Utilize Your Space

• Put any nail polish and retail displays where they’re easy to reach - customers will want to browse and purchase things.
• A floor to ceiling mirror can open up and brighten a small or dimly-lit space.
• Recessed or hidden shelves and cabinets save space and keep tools organized.
• Floor leveling and different wall colors help to differentiate areas or separate reception from the main nail salon.
• Darker colors on upholstery help hide stains.

Related article: Level Up Your Look: Salon Interior Design tips and ideas

Now you’re all set! What happens next?

Once your nail salon is up and running, you’ll need to focus on maintaining a smooth operation. Staff management is crucial for preventing errors and ensuring your guests remember your business for all the right reasons. Here are some tips to keep in mind:  

• Communicate effectively: A good salon is known for impeccable service and quality. Each team member needs to understand their role, responsibilities, and creative freedom. Build a culture of clear and thoughtful communication, even when things don’t go as planned.  
• Take care: Nail services are precise and labor-intensive, and some, like the application of gel and acrylic nails, are also complicated. Ensure that your staff are careful to avoid any incidents that might cause distress or injury.  
• Lead by example: A good salon owner embodies the qualities they expect to see in their team. Set a precedent that motivates your team to bring their A-game every day.
• Utilize technology: A great salon management software will manage appointments, schedule staff intuitively, track inventory, and handle payments. It will prevent mix-ups and save you time – allowing you and your staff to spend more time doing what you do best; beautiful nails!

Key Takeaways  

Every business comes with some element of risk, but with thorough market research and thoughtful preparation, you can start your own nail salon business with confidence.

When it comes to keeping your salon running smoothly, let Zenoti handle it for you! Our extensive experience of salon workflows makes us the go-to all-in-one nail salon management software.