New Esthetics Business: Be Fiscally Responsible

Fiscally Responsible Esthetics

A lot of student estheticians think they are going to jump into business ownership when the ink dries on their esthetics' license. While it is a great dream, something to work for down the road, it is not as easy as many students and recent graduates think. Running your own business is not a school project, it is reality and it is your dollars at stake. It doesn't matter whether that business is under the umbrella of booth rental or actually opening up your own shop; the fact is running a business doesn't come with a revolving bank account and you have to be realistic in your financial expectations. I have a friend who is opening up a spa within her family's health care business, and while she has the familial, financial support I advised her to be fiscally responsible because she wants to buy a lot of expensive items in the early stages with no customer base.
What do I mean by that? I mean to slow down, write a business plan and determine your costs and what you truly need and don't need. Do you really need two product lines in the early stages? Do you need every chemical peel the companies have to offer? Do you need the latest and greatest equipment? It is easy to go shopping like you have Paris Hilton's credit card when you get excited about your new business, but you've got to stop yourself in your tracks and figure out what is truly necessary. Yes, you need supplies, product lines, and equipment but think hard before you sign up for a full backbar (skin care line starter kits).
The story of "The Tortoise and the Hare" comes to mind here, there are some estheticians who get so overzealous and buy up every product only to find out that customers are few and far between. The products linger on the shelves and collect dust until they've exceeded their expiration dates--dollars down the drain. The esthetician that has the financially savvy to slow down and think about the costs involved, and budgets only for the necessities is more likely to run a successful business, and won't go broke nearly as quickly as the one who thinks she has Paris Hilton's budget. Of course, opening up your own practice is a lot of fun, but unless you have an unlimited bank account slow down and think about what you really need vs. what you want.

Here are some ideas to get you started:
(1) Only work with skin care lines who allow you to buy a la carte--in the early stages you might not need that whole back bar. You can always buy an entire back bar when you actually have the business to sustain it. (Image Skin, Nardos Naturals, Skin Scripts, and Pevonia are just a few that you can buy a la carte.)

(2) Buy equipment that you actually need right now like mag light with steamer attachment and towel cabbie. Look for used equipment if possible to save money--there is always a spa going out of business. Add on electrical and Microdermabrasion machines at a later date when you can afford it.

(3) Don't dump a lot of money into advertising. Spend your money on a professional website, business cards (Vista Print has a free section of cards) and use your networking skills to generate new business instead of wasting precious dollars. If you are booth renting work with other therapists/hair stylists about offering free services for their referrals. Hand your card out to everyone with a heartbeat.

(4) Be realistic in the amount of supplies you will need--this is one area you will have to spend money: facial brushes, back brushes, cotton rounds, 4x4's, sponges, towels, linens, bolsters, utility carts & cabinets, closed trash cans, tweezers, scissors, applicators, music, retail bags, facial stones, and the list goes on depending on your needs. These dollars add up quickly.

(5) Don't skip liability insurance--it is a must--I cannot stress the importance of this one. It is fiscally irresponsible to work on any clients without proper liability insurance--this will cost you more money down the road.

(6) Tread carefully with salon software--don't buy the most expensive one with all the bells and whistles--wait until you are booming with business to buy that one. Start with a more affordable package first.

Starting an esthetics business is a joy, but I can't stress enough the importance of being fiscally responsible by doing a needs list vs. a wants list, and creating a budget. There are many esthetics businesses that start out with gusto and they buy every product line under the sun; every new piece of equipment to hit the market; feed bundles of money into advertising and fancy software only to find out they don't have a viable client base to support all these big ticket items. So, slow down and really think before jumping into your own business, and make sure you seek the advice of a qualified accounting professional. If you need additional business help, SCORE is a free counseling service for business startup's where previously successful business owners will counsel you via e-mail or in person to help you get going in the right direction. Happy Business Ownership!