cost to open barber shop

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The benefits of running a barbershop business

Many entrepreneurs with experience or schooling in cosmetology, haircuts, or styling look forward to the day that they are able to open their own barbershop. Like in any industry, owning a business can be a lot of work, and this type of business is no different. But let’s look at a few of the benefits of owning a barbershop, instead of working at one:


Becoming a small business owner gives barbers the ability to work independently. Many individuals that work in service industries do so by renting or leasing space in someone else’s shop, but opening your own barbershop gives you the freedom and flexibility to set your own hours, prices, and services provided.

Business options

Entrepreneurs that choose to start their own business can choose how they’d like to structure their business entity. The business structure you choose will determine how much taxes you pay, the bookkeeping requirements, and make it possible to hire employees. Some common business structures for small businesses are:

  • Sole proprietorship – An unincorporated business owned by one individual.
  • Limited Liability Company (LLC) – A business where the owners, called members, are made up of one or more individuals, corporations, other LLCs, and foreign entities.

Another advantage to opening a barbershop is the freedom to choose what kind of business to operate and whether you operate your business from one location, multiple locations, or provide mobile services. Different types of business for a barber or stylist may include a traditional barbershop, traveling beard trimming services, a hair salon, or a nail salon.

Using natural talent

Individuals that learn to cut hair, style beards, or perform other beauty shop services typically get into the industry because they have a passion for the art of barbering. Opening a barbershop provides entrepreneurs the opportunity to work for themselves and do something they are passionate about.

Unlimited earning potential

Choosing to operate your own barbershop gives you the flexibility to control your income. Being a self-employed barber allows individuals to choose how profitable their business can become. Barbers control their income by making decisions about how often to work, what prices to charge, and whether to strive for expansion or an independent store.

How much does it cost to open a barbershop?

According to the average cost of opening a barbershop in the United States is $50,000 to $150,000.  However, there are many variables when determining the total cost to open a new barbershop.

Type of business

The type of barbershop you’ve decided to open is one of the most influential factors on the total startup costs required. The expenses will be different depending on if you choose to purchase a franchise like, Diesel Barbershop, or start your own company.  There are advantages to purchasing a franchise including:

  • Having access to a proven business plan and business name
  • Receiving continuous corporate support
  • Different financing options available for franchised businesses
  • Lower startup costs than individually owned businesses of the same type and size

Aside from whether the barbershop is a franchised location or not, the type of barbershop will also factor into the cost. Business owners with experience in haircuts may choose to open an adult barbershop, a place that caters to children, a full-service salon that offers a variety of grooming services and products, or a mobile hair trimming business.


The location of a business is an important factor to consider when calculating the required startup costs for a barbershop. The costs will be significantly different to open a full-service salon in a busy city than to lease a space in a shared location. Before setting your sites on that space for rent in the mall, consider your available startup funds. The cost of your barbershop will also depend on whether you’re building a new location or purchasing an existing location with the plan to finance renovations.

Business model

Sole proprietors that open a barbershop with the goal of working alone will have lower startup costs than business owners that hire a staff to operate a full-service hair salon. Barbershop owners that have any number of employees or hairdressers should factor in at least three months’ salary for each staff member when calculating total startup costs.

What is required to open your own barbershop business?

If an independent barbershop, a franchised location, or a traveling grooming service is your business dream, you’re probably wondering what you will need to do to start the business. While the factors listed above will determine the precise requirements, some examples of minimum requirements are listed below.

Permits and licenses

The licenses required to start your own business vary depending on the geographical location, services offered, and type of barbershop. Some of the barber license requirements include:

  • Occupational license – Cosmetologists and barbers are required to complete training and obtain a professional license from a cosmetology college or barber school. Occupational licenses are typically mandated by the state you are operating in.
  • Operating license – Generally monitored by the county, operating licenses give the business owner permission to be open for business.
  • Zoning permits – The city zoning department issues permits that show your location is approved for the type of business you are running and that you’ve received approval for occupancy and met all licensing requirements.
  • Health permits – Salons require a health permit from the city. Health permit requirements will vary depending on the city you’re in, so check with your local governing agency for more information.
  • Employer Identification Number (EIN)– If you are going to have any individuals working with you, you’ll need to get an EIN from the IRS.

Business Insurance

Insurance is a mandatory cost of doing business and protects your investment in the case of an unexpected interruption in business, a lawsuit, a natural disaster, or any other unforeseen circumstance. When researching the requirements to own a barbershop business, consider investigating the following types of insurance:

  • Business owner’s umbrella policies
  • General liability insurance
  • Property insurance
  • Worker’s compensation insurance

Marketing Strategy

Many barbers rely on word of mouth to get the word out about their services, but if you are new to the industry, you may consider doing some advertising before opening your shop. The type of advertising you can do will depend on your marketing budget, business plan, growth strategies, and storefront exposure. Depending on their target market, most new business owners can see a great deal of success just by promoting their business on social media and being listed on Google maps.


To run a successful barbershop, there is a list of supplies you’ll need to purchase. Of course, the exact product you’ll need will depend on the types of services you offer but may include:

  • Shampoo and styling gels
  • Clippers and scissors
  • Trimmers and razors
  • Combs and brushes
  • Barber chairs
  • Retail products
  • Cash register
  • Disinfectant and other basic cleaning supplies


The equipment needed to open a barber business will depend on if the services are offered through a mobile service or in a retail location. However, some equipment that may help get a barbershop started includes salon chairs, accounting software, sanitizing machines, laundry equipment, signage, and more.

How to finance a barbershop business

Once you’ve created a business plan and made some decisions about the type of barbershop you’d like to open, you’re probably wondering how you are going to afford the startup costs. Fortunately, there are many financing options available to new business owners.

SBA loans

SBA loans are a great option for barbershop owners because of their low interest rates. The loan programs are partially guaranteed by the Small Business Association but financed by a traditional or alternative lender. In addition to lower interest rates, SBA loans also offer low down payments and flexible repayment terms. However, the SBA loan application process can take up to three months before you can access the funds in your business’s bank account.

Term loan

Term loans are a traditional type of financing that can be used for the purchase of a new business or to refinance a current loan. A term loan allows the borrower a lot of money upfront that is repaid over time according to the predetermined repayment terms. The monthly payments for term loans consist of a fixed or variable interest rate and principal and the number of payments depends on the terms given in the origination documents. Some borrowers with little or negative business credit history may be required to use a personal asset, like real estate, as collateral.

Business line of credit

A business line of credit is a type of short-term loan. Lines of credit are revolving credit sources, like a business credit card, that offers approved borrowers access to fast funding whenever it is needed. The interest rates for a line of credit are typically higher than those of traditional term loans, but interest is only paid on the amount of credit the borrower has withdrawn. Once the balance is paid off, the credit becomes available again, just like with credit cards. This type of financing is common for startup costs, cash flow fluctuations, and equipment financing.

Where to get a loan for a barbershop

Depending on the type of financing you are interested in, there are two popular options for business lending. Small businesses, like barbers, typically receive outside financing from either a traditional lender or an online lender.

Traditional banks

Traditional lenders are typically banks or credit unions with brick-and-mortar locations. Traditional lenders, like Bank of America, Wells Fargo, and U.S. Bank, are attractive options to borrowers because they enjoy working with a name they recognize. Traditional financial institutions offer lower interest rates and longer repayment terms than other alternatives. Loans from banks or credit unions are not a viable option for many people wanting to open their barbershop quickly though because the application process can take up to two months and the approval requirements are tougher for many small business owners to meet.

Alternative lenders

If you are looking for a flexible and fast funding option to open a barbershop, you may choose to work with an online lender, like Biz2Credit. Online lenders, also called alternative lenders, can fund loans much faster than traditional banks, sometimes as quick as 24 – 72 hours, and they offer an online application process. They are also a great option for new barbershops because of their flexible eligibility requirements and multiple loan options.

Bottom Line

Combining your passion, talent, and business ideas to open your own barbershop is a great way to achieve independence while making money. Before going into business as a barber, consider what type of location you are interested in operating. Whether your goals include mobile services or locations in multiple cities, there are some great financing options available at Biz2Credit.  Consider working with one of their financing experts or checking out Gulum Mustafa’s salon success story.

Learn about the Biz2Credit financing process

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