Beauty Salon Loans
June 12, 2019
What funds are usually needed by beauty salons?
This loan can meet various kinds of needs needed to conduct a salon business, including the following:
Deposit / Investment Fund
Having sufficient deposits is very important to ensure the company’s activities run smoothly. This loan is very useful to ensure you have sufficient savings if one day you experience a financial crisis.
This loan can also be used to supply the latest beauty products, such as the procurement of natural-based products, organic products or other goods that are in high demand.
Equipment loans or procurement of leasing can be an injection of funds to get additional equipment, or even replace old equipment to ensure that the services and services you provide meet current beauty trends.
Overcoming Seasonal Needs
Changes in trends according to season can affect your business both negatively and positively. Know the pattern and you can do a strategy plan that can help you through business ups and downs throughout the year. Getting a loan can help you get through a difficult time, or meet the costs of holding a promotion and offering clients, such as during a marriage or farewell party.
Manage Expenditures for Employees
When you are new to business, maybe you are the only employee who has to handle all work tasks. But as your business grows, you need additional labor to keep up with business growth.
In addition to the cost of giving a salary, you also need investment to provide training for employees, so that your salon offer will be more competitive and competitive. Like in the PREP Luxe hair salon, its founder Jacqueline Chang prioritizes continuous training for her employees. He said: “To be at the forefront of the competition, our hairdressers must always be fluent in the latest hairstyles, even creating the latest hairstyles at PREP Luxe.”
Marketing Fund Loans
Implementing online and offline marketing is key so that your business is known to many people. Strategies that are often taken by beauty salons, for example, subscription programs, member get member programs, and opening stores and booths at an event, collaborating with influencers, creating content that consumers like, and investing in the context of marketing and campaigns on social media.
Investing in Digitization
Setting cancellations of meetings with clients, missed orders and lists of workers are problems that service providers often face every day – but investing in the right digital tools can help owners complete this task efficiently. Examples include POS and devices for managing schedules (Square, MindBody), devices for online ordering (Vanitee) and salon management (Vaniday).
In a time when rapid technological developments like now, digital helps us become the leader in meeting consumer needs – both by using digital devices to build relationships with consumers or using non-cash paying services. Mr. Gavin Teo, managing director of the beauty salon Avone Beauty Secrets said: “It’s about comfort and convenience, and if we can’t adapt, we will be left behind”
What types of beauty salon loans are available?
Loans without collateral
This type of loan does not require you to surrender assets as collateral as on collateral loans, but is approved based on other factors such as the ability to pay and the value of your company.
Leasing Equipment / Leasing
It might cost a lot of money for the cost of procuring and maintaining salon chairs, manicure tables, spa jets so that your salon will look excellent and the services provided are efficient.
The advantage of leasing is that you do not need to purchase equipment directly, because there is a long-term lease agreement. Payments are made every month depending on the leasing provider, usually up to several years.
At the end of the agreement time, you have the choice to return the tool or buy it at market price. This option makes it easy for you to want to have the latest output tool when the agreement is complete.
Merchant cash advance
MCA is a credit card based transaction. Through the provider, you will get cash, which then must be paid according to the percentage of your credit card on a daily or monthly basis. MCAs offer flexible and versatile benefits, you will pay an increasingly smaller amount (rather than paying a fixed amount regularly), and can be used for a variety of short-term business needs.
Imagine a line of credit as a capital for your business – you can borrow a number of money that has been approved many times. Interest will only be charged according to the amount of funds that you withdraw, and then you can use that amount again.
This credit line can be used for a variety of corporate needs such as overcoming the gap in the flow of funds, paying off inventory costs, paying employees, and buying large-scale products. The flexibility offered makes this type of loan an option that can be used by beauty salon owners.
Tips for preparing a beauty salon loan application
Looking for a loan that suits your beauty salon needs? Here are some tips:
Map your business plan
New business people – especially those who operate less than a year – often find it difficult to obtain loans, lenders are usually less willing to lend to companies whose experience is still small without a record of profitability.
Describe your financial needs, sales estimates, cash flow, income and other things that can give lenders an idea of the progress of your business in the next six months or one year. This is also useful for setting qualitative goals in your business plan. Examples of questions such as: how will your offer be ogled by the market? How fast will your business grow?
Show your ability to maintain revenue growth
Businesses in the field of beauty are considered a high-risk business because the income generated fluctuates, and maintaining consumers to always subscribe is one of the biggest challenges for business owners. In order to get a high chance for an approved loan, you must demonstrate the ability that you can attract consumers and keep it a regular customer.
The right time to apply for a loan is after you have had a stable business growth for three to six months, prospective fund providers will see this as an indicator of your business on the right track.
Show that you are one step ahead in competition
The growth of a medium-sized home business, a well-known and well-established salon and other beauty salon businesses, makes you in a tight competition.
That way, it’s important to show your ability to compete with beauty salons who have been born first and can maintain their customers. For example, if you offer a nail spa, you need to show your salon to be the number one choice, for example by offering more competitive prices than other salons.
Where can I get a loan for a beauty salon?
Conventional banks and fund providers often consider high-risk businesses in the field of beauty, because of uncertain income and high competition in the industry.
Loan providers usually require complete documentation, long periods and strict assessments.
With online loan programs like Astro, applying for loans can be more convenient, efficient and fast – sending submissions only takes minutes, then you will be notified of loan status in only 24 hours.