6 Tips for Starting an Esthetician Business

Are you an esthetician looking to start your very own business? Read on to learn the top tips for starting an esthetician business.
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Last Updated: Jul 26, 2022

Best Tips for Starting an Esthetician Business. Image/Shutterstock

Starting your esthetician business as a solo entrepreneur or as part of a larger salon is an exciting time in your career.

Reaching this milestone that you’ve worked hard to achieve opens up many new opportunities to further enrich your skills and life.

Creating a successful business in this industry requires careful planning. When transitioning to a company owner, quite a few steps are involved.

To get started on the right foot, the following six tips can help open your new booth, salon, or spa smoothly.

6 Tips to Consider When Opening Your Esthetician Business

Congratulations! You’ve achieved something amazing by owning a skincare business. However, before you start this next phase of your career journey, the following tips can prove helpful when initially setting up your esthetician company:

1. It’s All About Location

When you open your doors for business, where do you envision your clients walking in? The front of a salon or your home? Maybe you plan to go the concierge route and provide treatments in clients’ homes.

Perhaps you want to still be in a well-known salon or spa, but just pay rent for a booth. Whatever your venue, ensure it’s best for your financial goals and clientele.

2. Create an Eye-Catching Portfolio

Before you depart from your current company, or if you have already been offering your services as a side gig, you need a professional portfolio to attract clients to your new business.

Don’t hesitate to ask your loyal customers if you could take pictures of their results (with their permission, of course!). These images can be used on your new company website, social media, and other marketing collateral.

Just make sure you communicate where these beauty shots will be used. Or, you can be your model if you don’t have a customer base established.

3. Create a Business Plan Sooner Than Later

Whether you plan to have several employees or operate solo, you need to finance your business and guide it to success.

This requires business planning, which will be the roadmap you need to achieve your goals, and convince potential investors to fund your enterprise, too!

When determining what your costs will be, you should be able to base this estimation on overhead that will be a constant in your budget, including:

  • Lease costs or mortgage for your workspace
  • Required licensing fees and permits
  • Business insurance premiums
  • Supplies and equipment
  • Transportation costs (if operating as a concierge service)
  • Marketing costs
  • Payroll
  • Operational expenses (electric, water, gas, etc.)

Depending on the location of your esthetician business, there are other regular costs you might have to consider.

4. Secure Funding

With a business plan, you’re ready to start applying for funding. Unless you have a significant nest egg to tap into or are creating a partnership to share the startup costs, you will need $18,000 to $36,000 in capital to launch your company. This money is crucial in acquiring your equipment, initial inventory of supplies, and marketing.

If you plan to purchase a retail space, add down payment costs onto this total, which means you’ll quickly need over $75,000.

Make sure you track your purchase orders, receipts, and warranties. You may also want to consider purchasing a Business Owner’s Policy (BOP) to add an extra layer of protection against risk for your assets and commercial property.

5. Pick the Right Business Entity for Your Goals

In addition to business planning, you’ll need to decide how your company will be formed. Your decision will depend on several factors, including taxation, liabilities you face, and long-term goals you have for your venture.

For example, you may initially decide to operate as a sole proprietor, which won’t require startup costs other than obtaining the necessary licensing and permits required by your local government. But, this also means assuming entire personal liability if something goes wrong.

LLCs, partnerships, and corporations require registration with your Secretary of State. This can incur some filing fees and documentation requirements but will ensure your assets aren’t immediately jeopardized in case of a customer lawsuit.

6. Ensure Your Business and Your Services

No matter what industry you run a business in, inherent risks have serious financial consequences. For example, as an esthetician, you apply treatments containing chemicals that could burn your client if not used properly. This mistake requires professional liability insurance since general coverage only addresses damages to third parties that aren’t related to your service, like a slip-and-fall accident on your front walk.

Before you fret about the cost for your insurance policy, consider how well your business would fare if your venue suffered severe storm damage. All of your equipment and supplies were lost?

Could you afford to replace these items out of your pocket?

Unfortunately, for many estheticians, the answer is no.

Additionally, in most States, having insurance for your business is mandatory anyway, so having a tailored policy can help you be 100% protected and save money.

Making the Most of Your Esthetician Business

The future is bright for estheticians, but opening your own business requires thoughtful planning, adequate financing, and comprehensive risk management strategies.

Being adequately insured is crucial to your company’s finances and reputation in cases involving customer injury claims, severe weather damaging your assets, or an employee getting hurt on the job.

Don’t risk all of your hard work being jeopardized by choosing to skip liability coverage. Instead, speak with an insurance agent about coverages that offer the best protection for you and your business.

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