How To Create Your Hair Salon Model Canvas

Making a business model canvas for your hair salon is a great way to build upon and use your business plan more creatively. Business plans tend to be a bit on the dull side and can be challenging for readers to get through.

Instead of a standard layout, a business model canvas takes the most critical information from your business plan and puts it into an easy to digest model. 

To create your business model canvas for your hair salon, you need to include these nine sections:

• Customer segments
• Customer relationships
• Channels
• Value propositions
• Key activities
• Key resources
• Key partnerships
• Revenue streams
• Cost structure

We will breakdown each of these sections, help you extract the critical information from your business plan, and give you examples of how to create each section in your model canvas. After that, we will have a sample canvas & template for you to fill out.

*For our examples and canvas at the end, we will be using “A Cut Above Salon” as an example. It is a premium, full-service hair salon that targets the affluent members of its market area. 

Customer segments

We begin our model canvas with customer segments; this helps us identify the ideal customers we are trying to serve. 

The reason for doing this is that if you try to reach every potential customer, you will stretch your resources too thin. You need to identify what customers need your services and will listen to your marketing message. 

Typical ways to breakdown customer segments include:

• • • Age
    • Income
    • Marital status
    • Geographic location
    • Special needs/wants from their childcare

Example:

A Cut Above Salon has two main customer segments.

Our first and foremost customer segment is women between 50-70 years old with a household income of over $200,000/yr. These women are typically retired or semi-retired. They have plenty of time and are willing to pay for a premium salon service where they can get social interaction and beauty services.

Our second customer segment is younger women aged 30-50 years old and a household income of over $200,000/yr. We separate these two groups because this younger customer segment is still in the workforce and has different needs than the older generation. This customer segment is more focused on status and looking their best for their friends, family, and colleagues. 

We don’t market as much to low-income customers because they typically think our prices are too high and they don’t need the level of quality we provide.  

Key Points:

• • • Target wealthy clients
    • Breakdown by age because of different needs from their salon
    • Avoid marketing to low-income clients because they aren’t looking for our price point.

Customer relationships

Customer relationships are crucial to being able to retain customers, as well as leveraging your best customers to help bring in more clients. Every salon aims for great customer relationships, but sometimes these relationships suffer from many other tasks and priorities.

The keys to having excellent customer relationships are:

• • • Be kind, be friendly, be respectful.This seems so easy, but it is easier said than done. Every time you or an employee interact with a client, you need to put their needs and experience at the center of your world. You can’t let personal problems, frustration, or fatigue negatively affect your customer’s experience at your salon. 
    • Identify your BEST customers.
      • There’s a significant difference between your right customers and your GREAT ones. Once you have identified your best customers, you need to work with them to help spread the word and bring in referrals. Your best customers are the ones who are delighted with your services and would be more than willing to send their friends and family to your salon.
    • Develop a referral program
      • A strong referral program can be the difference between fighting for customers and having a steady stream of quality clients. When you have a sound referral system, you get pre-qualified customers, but you also build stronger relationships with your customers who referred the new client to you. 

Example:At A Cut Above Salon, our goal is to treat every customer with the respect & kindness they deserve. We want our customer’s salon experience to be relaxing and have them leave with a smile on their face and newfound confidence. 

We strive to build strong, meaningful bonds with our customers. We understand that our customers are the heart of our business, and we want it to be a win/win relationship. One way we do this is by offering incentives for referring their friends and family to our salon.

Key Points

• • • Treat every customer with respect and kindness.
    • Provide excellent service and a relaxing environment
    • Leverage our great customers into referrals 

Channels

Your marketing channels are the different platforms you will use to market and advertise your hair salon. Some typical marketing channels are:

• • • Website
    • Social media
    • Search engine optimization
    • Search engine advertising
    • Newspapers
    • Flyers
    • Brochures
    • Billboards
    • Car advertising
    • Every salon will be different in their marketing needs, as well as their marketing plan. Along with this, each target market will respond differently to different marketing channels. This can be challenging to find the right mix of channels.

The most effective way to find the right combination is to try out a couple of channels that you think will work best. After this, you need to track your results, then make adjustments as needed near. This is an effective and economical way to get feedback on your marketing efforts. 

Example:

We are currently focussing on Facebook Ads and Google AdWords to direct customers to our website. With Facebook Ads, we can target our specific customer segments and give them offers tailored to their needs. Google AdWords is helping drive traffic from people searching for hair salons in our area. 

We have distributed some flyers to other local businesses and community locations to help drive local traffic. 

Key points

• • • Facebook Ads
    • Google AdWords
    • Drive traffic to the website
    • Locally distributed flyers 

Looking for more information about advertising your salon? Check out our article HERE to learn more!

Value propositions

Your value proposition is the things that set you apart from your competition and give customers a reason to choose your salon. It would be best if you narrowed down the value proposition to the handful of things your salon does better than everyone else. 

Some typical value propositions:

• • • Lower cost
    • Exceptional service
    • High quality
    • Unique or multiple services
    • Highly-trained staff
    • Green products
    • Wellness programs
    • Excellent facilities
    • Convenient booking options
    • Free cancellation
    • Guarantees

Example:

At A Cut Above Salon, we make sure your salon experience is unforgettable and will leave you feeling like a million bucks. We offer premium services, highly-trained staff, and exceptional facilities. We guarantee you will be satisfied with our services our your money back!

Key points

• • • Premium services
    • Highly-trained staff
    • Great facilities 
    • Money-back guarantee

Key activities

Your key activities are the things you do that help you achieve your value proposition. 

These can be things like:

• • • Getting a loan to purchase new equipment
    • Charge a higher rate so you can offer better services
    • Extensively train employees
    • Don’t overbook, so clients don’t have to wait.
    • Marketing effectively to increase revenue.

Example:

Our highly-trained staff is the key to helping us provide premium services that other salons can’t compete with. It is a significant expense for us to train our employees as thoroughly as we do, but it more than pays for itself because we can charge premium prices for unique services. 

Key points

• • • Highly trained staff
    • Premium services 
    • High price point

Key resources

Your essential resources help you achieve your value proposition, but instead of things that you are doing, they are the things that help you with your key activities.

Things like:

• • • Convenient location
    • Quality equipment
    • High-end CRM software
    • Well-trained employees
    • Quality facilities

Example:

We invest in our employees by requiring them to complete 20 hours of continuing education each year, at no expense to them. We believe our employees are our most incredible resource and should always be improving. Along with our employees, we reinvest 5% of our profits each year towards new equipment and technologies to improve our salon.

Key points

• • • Continuing education for staff
    • Investing in new equipment

Key partnerships

Having some complementary businesses in your community that you can team up with can be an extra boost for your salon. Pairing up with other businesses can help you receive more customers and build a positive reputation in the community.

Typical partners for hair salons could be:

• • • Retail stores
    • Wellness coaches
    • Masseuses 
    • Gyms
    • Boutique stores

Example:

We have partnered with a handful of masseuses and wellness coaches to offer package deals for customers looking to improve their overall wellness and how they take care of themselves.

We have extended our referral program with these partnerships extensively and are receiving more qualified clients than ever. 

• • • Partnering with other wellness businesses
    • Two-way referral program

Revenue streams

Your day-in and day-out operations are likely going to be the primary source of income for your hair salon. However, it is always best to diversify if possible.

Adding a couple of revenue streams can give your salon some flexibility and insurance for slow times. Multiple revenue streams are ideal, but make sure you are still putting enough time and effort to keep your salon running as it should.

Some options for other revenue streams:

• • • Retail sales
    • Blogging
    • Online instructional videos
    • Hairstyling courses
    • Hosting parties or events 

Example:

Currently, about 70% of our revenue is coming from daily operations. Along with this, about 30% is coming from selling retail salon products in our store. We build our blog with impressive articles and hair styling tips and hope to build this into another revenue stream within two years. 

Key points

• • • Mostly day-to-day operations
    • Selling retail products is an essential chunk of the revenue stream.
    • Exploring other revenue streams

Cost structure

Your cost structure is a brief financial report highlighting your critical expenditures that will make your hair salon a success. 

Things like:

• • • Renting vs. owning a facility
    • Are you taking out a loan?
    • How much staff will be hired
    • How much staff will be paid
    • How much you will spend on facility maintenance or improvements
    • How much you will spend on IT services
    • How much you will spend on equipment

Example:

We are currently renting a facility and have taken out a small loan for some minor improvements and equipment purchases. We plan to save some money to purchase a location in 3-5 years, hopefully

We plan on hirings 4-5 stylists at startup, with plans to hire one stylist roughly every six months as demand grows. We are currently budgeting $15,000/mo for salaries. 

Key points

• • • Renting to save for a permanent facility later on
    • An adequate amount of staff
    • Small loan for improvements and equipment purchase

Hair Salon Business Model Canvas Example:

Looking to start your own Salon? Get the documents you need to get organized and funded here.

Please note: This blog post is for educational purposes only and does not constitute legal advice. Please consult a legal expert to address your specific needs.