Hair Extensions Business Plan
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Below is a template to help you create each section of your Hair Extensions business plan.
Executive Summary
Business Overview
Hairapy Extensions is a new hair extensions shop located in the heart of Los Angeles, California. Our mission is to make every customer feel empowered and beautiful by providing them with the perfect hair extensions and hair care products. We do this by offering every style and color imaginable so that every customer can find exactly what they want to feel and look their best. With our amazing customer service and enormous selection, we hope to be the most popular hair extensions store in the city in the next few years.
Hairapy Extensions is founded by Angelina Matthews, who has been a hairstylist for five years. Throughout her career, he has sold and inserted hair extensions for hundreds of customers and has found it to be the most enjoyable part of her job. As such, she has extensive knowledge of hair extensions and how to insert and care for them. Her experience and expertise will be the company’s most valuable asset.
Product Offering
Hairapy Extensions will showcase a wide variety of hair extensions throughout our store. Our hair extensions will come in all colors, from natural hair colors to fun dyed colors like pink or blue. We guarantee that every customer will find the perfect hair extensions that fit their style and budget. We also sell hair care supplies and accessories to ensure that our customers’ new hair extensions last as long as possible.
Customer Focus
Hairapy Extensions will serve the community residents of Los Angeles, California, and its surrounding areas. We will primarily target female and female-identifying people, as this group is traditionally the most likely to buy hair extensions and hair care products. We also expect most of our clientele to be in the age range of 20-40, as young women are much more likely to get hair extensions than women in other age ranges.
Management Team
Hairapy Extensions is led by Angelina Matthews, an experienced hairstylist and salon manager with over five years of experience. Throughout her career, she found inserting hair extensions to be the most enjoyable aspect of her job and wanted to build a company that solely focuses on hair extensions. After years of planning, she is finally ready to start her business. Her extensive knowledge of hair extensions and the industry will be the company’s most valuable asset.
Success Factors
Hairapy Extensions is primed for success by offering the following competitive advantages:
- Friendly and attentive staff who will go out of their way to find the perfect hair extensions for each customer.
- Comprehensive supply of hair extensions that includes every color and texture imaginable.
- Cost-effective pricing that rivals the competition without sacrificing service or quality.
Download the Hair Extensions business plan template (including a customizable financial model) to your computer here <–
Financial Highlights
Hairapy Extensions is currently seeking $280,000 to launch. The funding will be dedicated to the store design and buildout, working capital, overhead, supplies, and marketing costs. The breakout of the funding is below:
- Store design/build: $150,000
- Initial inventory, supplies, and technology: $50,000
- Payroll, rent, and overhead costs (3 months): $30,000
- Working capital: $25,000
- Marketing expenses: $25,000
The following graph below outlines the pro forma financial projections for Hairapy Extensions.
Company Overview
Who is Hairapy Extensions?
Hairapy Extensions is a new hair extensions shop located in the heart of Los Angeles, California. We provide an enormous selection of hair extensions to choose from, with every style and color imaginable. Customers can get natural colors to match their natural hair, such as blond, brunette, or red. They can also get dyed hair extensions if they want to add some color to their hair, such as blue, purple, pink, or green. Customers can expect to find the perfect hair extensions that fit their style and budget when shopping with Hairapy Extensions.
Our store will be located in downtown Los Angeles, nearby fashion stores, hair salons, and other hair care stores. We will also have an online shop for those who don’t live in Los Angeles or can’t make it to our location to make a purchase in person.
Hairapy Extensions is founded by Angelina Matthews, who has been a hairstylist for five years. Throughout her career, he has sold and inserted hair extensions for hundreds of customers and has found it to be the most enjoyable part of her job. As such, she has extensive knowledge of hair extensions and how to insert and care for them. Her experience and expertise will be the company’s most valuable asset.
Hairapy Extensions’ History
Angelina Matthews incorporated Hairapy Extensions as an S-Corporation on August 1st, 2023. Angelina has identified a potential retail location and is in the process of negotiating a lease. The company is currently being run out of her home but will move to the retail space once the lease is finalized.
Since its incorporation, Hairapy Extensions has achieved the following milestones:
- Found a retail space and signed a Letter of Intent to purchase it
- Developed the company’s name, logo, and website
- Determined equipment and inventory requirements
- Begun recruiting key employees with previous experience in the beauty/hair care industries
Hairapy Extensions’ Services
Hairapy Extensions will sell a wide variety of hair extensions online and in our store. We will offer several styles and every color imaginable, including numerous shades of blond, brown, red, pink, purple, and blue. Whether a customer wants longer hair, a style change, or a little bit of color without dye, we can find the perfect extension to fit their needs and budget. We also sell hair care products that ensure the extensions last as long as possible.
Industry Analysis
Hair extensions have been a part of style and fashion for centuries. In the past, hair extensions exemplified power and position and created lasting fashion trends. They were used to thicken and lengthen hair as well as to maintain a youthful appearance. It is believed that many powerful figures used hair extensions, including Cleopatra and Queen Elizabeth I.
The current hair extension industry is a thriving industry that helps many people show off their unique style and feel more comfortable in their bodies. Many people purchase hair extensions when they want to try a certain hairstyle but can’t pull it off naturally. Hair extensions are also popular amongst people who want to color their hair without destroying it with dye and bleach. Finally, hair extensions help many people suffering from thinning hair due to age or illness.
According to Future Market Insights, the current hair extensions industry was valued at $2.38 billion last year and is expected to grow at a compound annual growth rate (CAGR) of 5.3% from now until 2032. The industry is positively affected by the rise in disposable income as well as beauty trends created and spread by social media. These trends are expected to continue, and the hair extensions industry is expected to thrive for the foreseeable future.
Download the Hair Extensions business plan template (including a customizable financial model) to your computer here <–
Customer Analysis
Demographic Profile of Target Market
Hairapy Extensions will serve the community residents of Los Angeles, California, and its surrounding areas. We will primarily target female and female-identifying people, as this group is traditionally the most likely to buy hair extensions and hair care products. We also expect most of our clientele to be in the age range of 20-40, as young women are much more likely to get hair extensions than women in other age ranges.
The precise demographics for this area of Los Angeles, California are as follows:
| Total | Percent | |
|---|---|---|
| Total population | 1,680,988 | 100% |
| Male | 838,675 | 49.9% |
| Female | 842,313 | 50.1% |
| 20 to 24 years | 114,872 | 6.8% |
| 25 to 34 years | 273,588 | 16.3% |
| 35 to 44 years | 235,946 | 14.0% |
| 45 to 54 years | 210,256 | 12.5% |
| 55 to 59 years | 105,057 | 6.2% |
| 60 to 64 years | 87,484 | 5.2% |
| 65 to 74 years | 116,878 | 7.0% |
| 75 to 84 years | 52,524 | 3.1% |
Customer Segmentation
Hairapy Extensions will primarily target the following customer profiles:
- Women/female-identifying people
- Young adults
- People with conditions that affect their hair
Competitive Analysis
Direct and Indirect Competitors
Hairapy Extensions will face competition from other businesses with a similar company profile. A summary of the competitor companies is below.
Hair Heaven
Hair Heaven is a major online warehouse that sells wigs and hair extensions. They have every color and style imaginable, which makes them an incredibly popular hair extensions supplier nationwide. They are particularly popular with beauty supply stores as they can sell their products wholesale. Though Hair Heaven is a popular source of hair extensions, it is a completely online store. Customers who want to talk with a professional and purchase hair extensions in person will be more inclined to come to Hairapy.
Lanie’s Wig & Hair Supply
Lanie’s Wig & Hair Supply is a small, locally-owned supplier of all things hair care. This includes organic shampoos, hair extensions, wigs, and accessories. They offer many colors and styles of wigs and hair extensions to choose from, and many customers report being satisfied with their products. The store also has a few hair stylists on standby who can help them clean and style their hair extensions and wigs as needed. Though Lanie’s will continue to thrive, their selection is much smaller than ours. Our inventory will be far more enticing, and we will be able to find hair extensions for far more customers than Lanie’s can.
Sally’s Salon
Sally’s Salon is a popular and hip hair salon business located in downtown Los Angeles, California. People all over the city come here to get their hair cut and styled to keep up with current fashion and trends. In addition to providing hair styling services, Sally’s sells a large assortment of wigs, hair extensions, and hair care accessories. Customers can choose some hair extensions and have a stylist insert and style them all in the same appointment. Since Sally’s is such a popular salon, we expect them to be our biggest direct competitor.
Download the Hair Extensions business plan template (including a customizable financial model) to your computer here <–
Competitive Advantage
Hairapy Extensions will be able to offer the following competitive advantages over their competition:
- Management: Our management team has years of experience in the hair care industry, which allows us to sell to and serve customers in a much more sophisticated manner than our competitors.
- Friendly Staff: Our staff understands that buying hair extensions can be a stressful and difficult process, especially for those who need them to hide their thin or damaged hair. Hairapy Extensions only hires the friendliest staff who can work with these customers in a compassionate manner.
- Inventory: Hairapy Extensions aims to own the largest and most diverse collection of hair extensions that can be found anywhere in Los Angeles, California.
Marketing Plan
Brand & Value Proposition
Hairapy Extensions will offer a unique value proposition to its clientele:
- Friendly and helpful staff
- Affordable pricing on all products
- A large inventory of unique and stylish hair extensions that include every color and style imaginable
Promotions Strategy
The promotions strategy for Hairapy Extensions is as follows:
Influencer Marketing
Hairapy Extensions will partner with local beauty influencers to spread the word about the company. The company will offer discount codes to the influencers’ audiences to entice them to shop our products.
Billboards
Angelina Matthews will invest in appealing billboards and marketing techniques for the company. The billboards will be located in highly trafficked areas of Los Angeles where the visibility is highest.
Social Media
Hairapy Extensions will have Instagram and Facebook business profiles where Angelina will post professional and appealing pictures that will draw in anyone looking for hair extensions. The posts will be able to show the beautifully designed store as well as satisfied customers with their new hair extensions. Angelina will also post upcoming specials and special offerings.
Website & SEO Marketing
The marketing assistant will design and manage a comprehensive and attractive website for Hairapy Extensions. The website will be easy to navigate and include pictures of our products, pricing, contact information, and location. The SEO will also be managed to ensure that anyone searching “hair extensions near me” or “hair extensions Los Angeles” will see Hairapy Extensions listed at the top of the Bing or Google search engine.
Pricing
The pricing of Hairapy Extensions will be moderate and on par with competitors so customers feel they receive value when buying our hair extensions.
Operations Plan
The following will be the operations plan of Hairapy Extensions.
Operation Functions:
- Angelina Matthews will be the Owner and President of the company. She will oversee the general operations of the store as well as provide customer services and sales. Angelina will spend the next several months hiring the following staff:
- Several associates who will provide customer service, sell products, and help insert hair extensions for customers.
- An Accountant who will manage all client invoicing, billing, and payables.
- A Marketing Assistant who will run all the marketing and promotions campaigns.
Download the Hair Extensions business plan template (including a customizable financial model) to your computer here <–
Milestones:
Hairapy Extensions will have the following milestones completed in the next six months.
- 9/1/202X – Finalize lease agreement
- 9/15/202X – Begin build out and design
- 10/1/202X – Begin hiring essential staff
- 10/15/202X – Finish build out and design; final walk-through of store
- 11/1/202X – Begin marketing campaign
- 11/15/202X – Grand opening of Hairapy Extensions
Management Team
Hairapy Extensions is led by Angelina Matthews, an experienced hairstylist and salon manager with over five years of experience. Throughout her career, she found inserting hair extensions to be the most enjoyable aspect of her job and wanted to build a company that solely focuses on hair extensions. After years of planning, she is finally ready to start her business. Her extensive knowledge of hair extensions and the industry will be the company’s most valuable asset.
Though Angelina has never run a business herself, she has been in the industry long enough to have an in-depth knowledge of the operations and marketing sides of the business. She will also hire other professionals who can help with the other aspects of the business she is unfamiliar with.
Financial Plan
Key Revenue & Costs
The revenue drivers for Hairapy Extensions will be the sales of our hair extensions and other hair products.
The major costs for the company will include the costs of inventory, payroll, and overhead. In the initial years, the company’s marketing spending will be high as it establishes itself in the market.
Funding Requirements and Use of Funds
Hairapy Extensions is currently seeking $280,000 to launch. The funding will be dedicated to the store design and buildout, working capital, overhead, supplies, and marketing costs. The breakout of the funding is below:
- Store design/build: $150,000
- Initial inventory, supplies, and technology: $50,000
- Payroll, rent, and overhead costs (3 months): $30,000
- Working capital: $25,000
- Marketing expenses: $25,000
Download the Hair Extensions business plan template (including a customizable financial model) to your computer here <–
Key Assumptions
The following outlines the key assumptions required to achieve the revenue and cost numbers in the financials and pay off the startup business loan.
- Average number of daily customers: 50
- Average product price: $250
- Annual Lease: $50,000
Financial Projections
Income Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Total Revenues | $360,000 | $793,728 | $875,006 | $964,606 | $1,063,382 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $64,800 | $142,871 | $157,501 | $173,629 | $191,409 | |
| Lease | $50,000 | $51,250 | $52,531 | $53,845 | $55,191 | |
| Marketing | $10,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
| Salaries | $157,015 | $214,030 | $235,968 | $247,766 | $260,155 | |
| Initial expenditure | $10,000 | $0 | $0 | $0 | $0 | |
| Total Expenses & Costs | $291,815 | $416,151 | $454,000 | $483,240 | $514,754 | |
| EBITDA | $68,185 | $377,577 | $421,005 | $481,366 | $548,628 | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| EBIT | $41,025 | $350,417 | $393,845 | $454,206 | $521,468 | |
| Interest | $23,462 | $20,529 | $17,596 | $14,664 | $11,731 | |
| PRETAX INCOME | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Use of Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Taxable Income | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Income Tax Expense | $6,147 | $115,461 | $131,687 | $153,840 | $178,408 | |
| NET INCOME | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 |
Balance Sheet
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $30,000 | $33,072 | $36,459 | $40,192 | $44,308 | |
| Total Current Assets | $184,257 | $381,832 | $609,654 | $878,742 | $1,193,594 | |
| Fixed assets | $180,950 | $180,950 | $180,950 | $180,950 | $180,950 | |
| Depreciation | $27,160 | $54,320 | $81,480 | $108,640 | $135,800 | |
| Net fixed assets | $153,790 | $126,630 | $99,470 | $72,310 | $45,150 | |
| TOTAL ASSETS | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $315,831 | $270,713 | $225,594 | $180,475 | $135,356 | |
| Accounts payable | $10,800 | $11,906 | $13,125 | $14,469 | $15,951 | |
| Total Liability | $326,631 | $282,618 | $238,719 | $194,944 | $151,307 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| Total Equity | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| TOTAL LIABILITIES & EQUITY | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 |
Cash Flow Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | ||||||
| Net Income (Loss) | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 | |
| Change in working capital | ($19,200) | ($1,966) | ($2,167) | ($2,389) | ($2,634) | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| Net Cash Flow from Operations | $19,376 | $239,621 | $269,554 | $310,473 | $355,855 | |
| CASH FLOW FROM INVESTMENTS | ||||||
| Investment | ($180,950) | $0 | $0 | $0 | $0 | |
| Net Cash Flow from Investments | ($180,950) | $0 | $0 | $0 | $0 | |
| CASH FLOW FROM FINANCING | ||||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 | |
| Cash from debt | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow from Financing | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow | $154,257 | $194,502 | $224,436 | $265,355 | $310,736 | |
| Cash at Beginning of Period | $0 | $154,257 | $348,760 | $573,195 | $838,550 | |
| Cash at End of Period | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 |
Hair Extensions Business Plan FAQs
What Is a Hair Extensions Business Plan?
A hair extensions business plan is a plan to start and/or grow your hair extensions business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
What are the Main Types of Hair Extensions Businesses?
There are a number of different kinds of hair extensions businesses, some examples include: Hair extension services, Hair extension stores, and Online hair extension sales.
How Do You Get Funding for Your Hair Extensions Business Plan?
Hair Extensions businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.
What are the Steps To Start a Hair Extensions Business?
Starting a hair extensions business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop A Hair Extensions Business Plan - The first step in starting a business is to create a detailed hair extensions business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your hair extensions business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your hair extensions business is in compliance with local laws.
3. Register Your Hair Extensions Business - Once you have chosen a legal structure, the next step is to register your hair extensions business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your hair extensions business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Hair Extensions Equipment & Supplies - In order to start your hair extensions business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your hair extensions business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.