The beauty industry has witnessed a shifting business model in the post-COVID years. One of the most impactful is the rise of booth renting, which offers flexibility for beauty professionals to manage their businesses. Average booth rent for salons in 2023 is relatively affordable, allowing independent stylists to practice their craft without impacting their cash flow. It’s a great option for startup salons and freelancer stylists looking to start the foundations of their own salon business.
The rise of booth renting
Before diving into the numbers, it’s worth understanding why booth renting has surged in popularity.
Traditional salons—where employees work on a commission basis or a fixed salary—often restrict a stylist’s ability to build personal clientele and set their service rates. Booth renting, on the other hand, grants professionals the independence of running their mini business within an established salon. They can set their schedules, determine their service prices, and often even choose which products to use.
In essence, it’s entrepreneurship without the overhead of opening and managing a full-scale salon.
Factors that influence average booth rent for salons
As empowering as becoming an independent salon operator feels, it’s essential to navigate this landscape with a clear understanding of costs, primarily booth rent. But what determines this rent? Here are the key factors:
- Geographic location. The adage “location, location, location” rings especially true here. A salon booth in a bustling urban area—say downtown Manhattan or central Los Angeles—will naturally demand a higher rent than one in a suburban or rural setting. Within cities, the rent can further vary based on the neighborhood’s affluence and foot traffic.
- Salon reputation. Renowned salons with a history of excellence, a vast clientele, and a significant brand presence often have higher booth rents. Securing a spot in such salons offers stylists access to an established customer base, potentially justifying the premium.
- Size and amenities. Not all booths are made equal. A larger space, perhaps one with additional salon tools or advanced equipment, will be priced higher. Moreover, booths in salons that offer luxurious amenities, like upscale waiting areas or high-end coffee bars for clients, may also command heftier rents.
- Lease flexibility. Sometimes, the duration and terms of the lease can influence the cost. A month-to-month rental might be priced differently than a long-term commitment. Some salons may also offer discounted rates for longer lease durations.
- Inclusions. It’s crucial to understand what the booth rent covers. Are utilities, Wi-Fi, and maintenance included, or are they additional? Some salons might also offer salon marketing services or front-desk support as part of the rent, adding to the value proposition.
Average booth rent by the numbers
According to a recent report by Small Business Trends, average booth rent in 2024 ranges from $400 to $600 per month. For salons in upscale neighborhoods or high-traffic areas—like spots in Manhattan or L.A.—booth rent can climb to the thousands. For salons with areas of less traffic, booth rent can even be as low as $200 per month.
As booth renting becomes an increasingly popular choice in the beauty industry, the average booth rent for 2023 is set to climb. It’s important for enterprising stylists to be aware of the terms of their contract, average booth rental rates at other salons in the area, and their own salon accounting and finances.
Navigating the booth rent landscape
How do you make sure you’re renting a booth that won’t break the bank? The first step in your booth renting journey is understanding your potential income. Start by calculating the average number of clients you serve daily, and then extrapolate that to a monthly figure. Multiply this by your average earnings per client, and you have a rough monthly income estimate.
Now, a golden rule to remember: your booth rent shouldn’t exceed 30-35% of this projected income. Sticking within these constraints leaves you with enough cash to cover other expenses, like products, marketing, and professional development, and still enjoy a comfortable profit.
Here’s how to make sure booth renting won’t break the bank:
- Understand the market. Before settling on a booth, research rents in your desired area. Understanding the going rates can equip you with the knowledge to negotiate a fair deal.
- Read the fine print. Ensure you’re clear about what the rent covers. Are utilities included? What about Wi-Fi or front-desk services? These additional costs, if not covered, can add up.
- Build a cushion. Just like any business, there will be slow months. Always have a financial cushion, equivalent to 2-3 months of rent, to tide over lean periods.
- Network and market. Relying solely on walk-ins can be dicey. Use social media to showcase your work, offer promotions, and engage with potential clients. Networking with other professionals can also lead to referrals.
- Re-evaluate periodically. Every 6-12 months, assess if the booth rent still aligns with your earnings. If you’re consistently making much more, perhaps you can consider a premium location. If rent is straining your finances, maybe it’s time to downsize or renegotiate.
Financial management for beauty professionals
With booth renting, beauty professionals essentially become business owners. Every business, big or small, demands astute financial management. Tracking earnings, managing expenses, ensuring timely payments, and even potential savings for future endeavors become crucial tasks.
NorthOne is the ideal banking partner for salon professionals. Tailored specifically for the modern professional, we offer a suite of digital-first features that seamlessly align with the dynamic and on-the-go nature of booth renters. From tracking earnings and managing expenses to ensuring timely rent payments and even setting aside savings for future growth, NorthOne has you covered.
For those navigating the booth rent landscape, NorthOne isn’t just a banking solution—we’re a business partner. Apply for an account today to create financial stability while you shine in your craft.Apply for an Account