ETS Tanning Bed Blog

Buying an existing tanning salon involves a lot more than applying for a loan and signing a few legal forms. It takes research, an understanding of the business development, patience and a willingness to walk away from the deal (it happens).

I came across a recent article on the GlobalBX blog about buying an existing beauty salon or barber shop . Yes, I know a tanning salon is neither of those things, but the business development between the two industries can be fairly similar. Both are service-oriented businesses often geared towards individuals interested in improving their physical appearance. As a result, many of the tips and steps laid out in the article could easily be applied to the tanning salon business.

1. Check the Customer Stats

Regular customers are going to be your bread and butter, so before you buy a tanning salon, make sure they have them. Then, make sure the number of regular customers is either going up or remaining stable, not going down.

If the tanning salon you're interested in doesn't have a strong customer base, ask why? Is it the local competition? The existing marketing? Do you think you could really turn it around and if so, how? Is the lack of regular customers reflected in the sale price?

 2. Assess the Equipment Value

Most of a tanning salon's hard value is in its tanning beds. A salon with 15-year-old beds and no concern for current trends has little-to-no assets other than its customers.

If you're looking at a salon and thinking of upgrading the equipment, or even just need help assessing the current value of the beds, please feel free to drop us a line . We'd be happy to consult on the potential equipment needs, if any, of a tanning salon.

3. Get a Clear Financial Picture

Before you buy any business, you should be able to review their financial records. You're looking at more than just profits and losses though, you want to funnel down to their individual overhead costs, marketing expenses, staff costs and each and every source of revenue. Is there potential here? Are there revenue sources, like product, that they're not maximizing? Could you cut costs or will too-high rents keep this salon from ever achieving real profitability?

4. What About Staff Assets?

In terms of staff, will this tanning salon be a turnkey operation or will you need to spend the first few months overhauling and retraining the staff ? A quality staff can make a transition smooth and effortless while a problem staff is going to cost you profits.

A friend in Oregon owns a number of salons and before he purchases an existing location, he either scouts it out himself or sends a friend or staff member over to check out the level of customer service. It's a tactic that gives him great insight into how well the operation is really working.

5. Is there Potential?

Finally, buying a tanning salon isn't just about accepting the existing customers and existing revenues, it's also about recognizing the potential for business development. While you don't want to ruin a good thing, any solid investment should have some room for improvement.