Nail Salon Business Plan Template [Updated 2024]

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Nail Salon Business Plan Template

If you want to start a Nail Salon business or expand your current Nail Salon, you need a business plan.

The following Nail Salon business plan template gives you the key elements to include in a winning business plan for your nail salon.

You can download the Nail Salon business plan template (including a full, customizable financial model) to your computer here.

 

Nail Salon Business Plan Example

I. Executive Summary

Business Overview

[Company Name], located at [insert location here] is a brand-new, upscale nail salon focusing on providing high-quality, full-service nail care to the surrounding community. Our product and service lines fit nicely with the prevailing tastes and preferences of the local area – middle class suburbanites want quality nail care, but don’t want to pay luxury prices for it.

Products and Services

[Company Name]will provide relationship-oriented nail services for all ages and both genders. Employees will focus on building long-term rapport with their clients and strive to deliver personalized beauty results for each individual.

All manner of special treatments will be available—including perms, extensions, coloring, and styling for special occasions (weddings, proms, etc.)

In addition to providing these services, [Company name] will also be a retailer of exclusive nail care products. Customers will find products at [Company name] that they won’t find in grocery stores.

Customer Focus

[Company Name] will primarily serve the residents within a 5 mile radius of our location. The demographics of these customers are as follows:

  • 27,827 residents
  • Average income of $74,700
  • 58.9% married
  • 49.6% in Mgt./Professional occupations
  • Median age: 38 years

In addition to this prime adult demographic for an upscale nail salon, there are two large high schools and four middle schools in the area. Students, particularly girls, from these schools will be sure to patronize [Company Name] for special occasions.

Management Team

[Company Name]is led by [Founder’s Name] who has been in the nail care business for 20 years. While [Founder] has never run a nail salon himself, he has been doing nails since age 15 and spent most of his adult life working at several major salons.As such [Founder] has an in-depth knowledge of the salon business including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.).

Success Factor’s

[Company Name] is uniquely qualified to succeed due to the following reasons:

  • The Company will fill a specific market niche in the growing community we are entering. In addition, we have surveyed the local population and received extremely positive feedback saying that they explicitly want to frequent our business when launched.
  • Our location is in a high-volume area with easy access from multiple residential and commercial district zones.
  • The management team has a track record of success in the salon business.
  • The upscale salon business is a proven business and has succeeded in communities throughout the United States.
  • Local competitors leave a large gap in the nail market—there are low-cost providers ($10-$20), and an ultra-luxury salon ($50+), but nothing in between.

Financial Highlight’s

[Company Name] is currently seeking $260,000 to launch.Specifically, these funds will be used as follows:

  • Store design/build: $140,000
  • Working capital: $120,000 to pay for Marketing, salaries, and lease costs until [Company Name] reaches break-even

Topline projections over the next five years are as follows:

Financial SummaryYear 1Year 2Year 3Year 4Year 5
Revenue$315,115 $466,067 $524,563 $590,400 $664,500
Total Expenses$345,594 $385,172 $419,434 $475,894 $507,480
EBITDA($30,479)$80,895 $105,129 $114,506 $157,020
Depreciation$20,840 $20,840 $20,840 $20,840 $20,840
EBIT($51,319)$60,055 $84,289 $93,666 $136,180
Interest$16,822 $14,719 $12,617 $10,514 $8,411
PreTax Income($68,141)$45,336 $71,673 $83,153 $127,769
Income Tax Expense$0$0$17,104 $29,103 $44,719
Net Income($68,141)$45,336 $54,569 $54,049 $83,050
Net Profit Margin-10%10%9%12%
Average customers/day2629323641

 

II. Company Overview

You can download the Nail Salon business plan template (including a full, customizable financial model) to your computer here.

Who is [Company Name]?

[Company Name], located at [insert location here] is a new, upscale nail salon focusing on providing professional nail services in an enjoyable environment. It will showcase a well-designed interior as well as a full-featured waiting area equipped with television screens and at-request refreshments. [The Company] also sells a variety of premium nail care products which will be on display in the waiting room.

[Company Name] was founded by [Founder’s Name]. While [Founder’s Name] has been in the nail business for some time, it was in [month, year] that he decided to launch [Company Name]. Specifically, during this time, [Founder] took a trip to Fort Lauderdale, FL. During his trip, [Founder’s Name] frequented a nail salon that enjoyed tremendous success. After discussing the business at length with the owner of the salon, [Founder’s Name] clearly understood that a similar business would enjoy significant success in his hometown.

Specifically, the customer demographics and competitive situations in the location and in his hometown were so similar that he knew the business would work. After surveying the local population, [Founder’s name] went ahead and founded [company name].

[Company Name]’s History

Upon returning from Fort Lauderdale, surveying the local customer base, and finding a potential retail location, [Founder’s Name] incorporated [Company Name] as an S-Corporation on [date of incorporation].

The business is currently being run out of [Founder’s Name] home office, but once the lease on [Company Name]’s retail location is finalized, all operations will be run from there.

Since incorporation, the Company has achieved the following milestones:

  • Found office space and signed Letter of Intent to lease it
  • Developed the company’s name, logo and website located at [website]
  • Hired an interior designer for the decor and furniture layout
  • Determined equipment and fixture requirements
  • Began recruiting key employees with previous nail experience

[Company Name]’s Products & Services

Below are [Company Name]’sinitial service offerings and in-store products sold.

Nail Technicians will be asked to perform the following services:

  1. Pedicures
  2. Manicures
  3. Acrylic Nails
  4. Gel Nails
  5. Hand & Foot Massages

[Company Name] will feature premium nail products in-store from these well established brands. It will continue to update its offering in order to provide the newest nail products to its customers.

Some of its featured brands will include:

  • OPI
  • Essy
  • Nails Inc.
  • RGB

Furthermore, the waiting area will have television screens and popular publications to make the wait for service more pleasurable. Toys and board games will also be on hand for children, as well as at-request refreshments which we will provide for free during the waiting period.

Salon Design

[Company Name] will develop a 2,500 square foot store whose key elements will include the following:

  • Stylist Booths
  • Reception Desk
  • Self-service coffee area
  • Pedicure Chairs
  • A waiting area with TV screens
  • Restrooms

The retail location has 10 dedicated parking spots which should suffice even in peak hours.

[Company Name] plans to be open 6 days a week, from 10AM to 6PM. As demand dictates, we may extend or reduce our hours.

 

III. Industry Analysis

[Company Name] competes against small, individually owned nail salons, spas and against major regional or national chains. There are over 269,000 registered nail salons in the United States, a figure that reflects the needs of 200 million people.

The industry is highly fragmented; operators are spread across many locations to be close to key consumer markets in high-traffic locations. This trend makes it difficult for one company to service a large portion of the entire market. According to the Economic Census, 99.8% of nail salons operatedfrom a single location

The Nail Salons industry is expected to continue revenue gains in the next five years, albeit at a much slower rate, growing at an annualized rate of 0.8% to reach $12.0 billion. Rising per capita disposable income will drive revenue gains, because it will allow more consumers to indulge in the discretionary services this industry offers, instead of relying on home-use products. During the five-year period, industry salons are also expected to increasingly expand into full-service salons, which will allow operators to diversify their customer base and mitigate revenue fluctuations.

Industry Trends

The industry in which [Company Name] will compete is experiencing a number of different trends.

Market-level trends:

  • Slow but steady growth. This market is expected to grow consistently at around 2% annually.
  • Success drivers. Customer satisfaction is what ultimately makes one salon triumph while another fails. The experience a salon’s client has determines whether or not they return and whether or not they refer others to the same salon.
  • Seasonal change.The nail salon industry tends to thrive in the summer and spring. [Company Name] will launch operations during [spring/summer], when the industry is experiencing higher sales. Catching a seasonal upswing in the first quarter of business should help provide a buffer of cash for [Company name].

Firm-level trends:

  • Price sensitivity at the bottom. The low-cost segment of the market, which primarily serves men and children, often competes on the basis of price. This reflects the different preferences of these particular consumers, who are often more interested in an affordable nail services than in seeing the same technician on a regular basis.
  • Size at the bottom. Larger nail salon chains tend to gravitate toward the bottom of the market. Brand loyalty is not strong here. Many companies in this segment use a franchise model.
  • Economies of scale. Larger salons are finding opportunities to succeed, by making effective use of support personnel. Receptionists and assistants at larger establishments can take care of many of the menial tasks. This permits a skilled technician to spend a higher proportion of their time actually performing nail services and generating revenues.
  • Premium independent salons. Independent salons also compete in the premium segment of the market. These firms develop loyal customer bases and select their location on the basis of population demographics.
  • Specialty salons. Presently, a niche is being carved out for salons that cater to very specific customer segments, most notably adult males from higher income brackets..

Customer-level trends:

  • Intense customer loyalty. Many salons develop repeat customers who become a regular client base and represent a significant portion of their revenues. Salons whose employees are able to develop strong relationships with customers can expect to see more long-term success.
  • Changing gender patterns. Traditionally, women bring in the lion’s share of revenues for nail salons, using beauty services more often and spending more at each appointment. In recent years, however, the male consumer’s attitude has begun to shift. Men now make up approximately 25% of salon clientele.
  • Gender preferences. Women are the most lucrative customers for nail salons, visiting more often and purchasing more special treatments such as coloring.
  • Ideal demographics. The baby boom generation generates a very large portion of nail salon revenues. This large segment of the market has reached the peak of its earning power, and they are beginning to need special treatments such as coloring.



Click below to see each section of our free nail salon business plan template. You can also click here to get our nail salon business plan sample pdf.
 

IV. Customer Analysis

You can download the Nail Salon business plan template (including a full, customizable financial model) to your computer here.

Demographic Profile of Target Market

[Company Name] will serve the residents of [company location] and the immediately surrounding areas as well as those who work in [company location].

The area we serve is populated mostly by the middle class; as a result, they have the means to pay for higher quality service, and are looking for a nail and beauty services somewhere between the deep discounters and the top-end luxury brands.

The precise demographics of the town in which our retail location resides is as follows:

WilmetteWinnetka
Total Population26,09710,725
Square Miles6.893.96
Population Density3,789.202,710.80
Population Male48.04%48.84%
Population Female51.96%51.16%
Target Population by Age Group
Age 18-243.68%3.52%
Age 25-345.22%4.50%
Age 35-4413.80%13.91%
Age 45-5418.09%18.22%
Target Population by Income
Income $50,000 to $74,99911.16%6.00%
Income $75,000 to $99,99910.91%4.41%
Income $100,000 to $124,9999.07%6.40%
Income $125,000 to $149,9999.95%8.02%
Income $150,000 to $199,99912.20%11.11%
Income $200,000 and Over32.48%54.99%

Customer Segmentation

The Company will primarily target the following three customer segments:

  1. Soccer/stay-at-home moms: The town has a large population of stay-at-home moms who are active in the school and community. These moms seek beauty services on a regular basis. Winning the loyalty of a mother often includes winning the business of her children and husband as well. These women are well connected to each other and as such are a prime source of referral business. [Company name] expects to regularly acquire new customers from referrals.
  1. Professionals: [Company name] is located along a well-traveled commute route. By offering convenient location and exceptional service to the customer, [Company name] will draw in working men and women who need to look professional for work.
  1. Students: There are multiple high schools and middle schools located in the surrounding area. These students still live on their parents’ income and can therefore afford to pay for higher-quality services than discounters provide. In particular, [Company name] can expect to generate significant seasonal business based on the beauty needs of the local youth culture.

 

V. Competitive Analysis

Direct & Indirect Competitors

The following retailers are located within a 5 mile radius of [Company Name], thus providing either direct or indirect competition for customers:

Joe’s Beauty Salon

Joe’s Beauty Salon is the town’s most popular beauty salon and has been in business for 32 years. Joe’s offers a wide array of services that you would expect from a beauty salon.

Besides offering nail services, Joe’s also offers hair care services. In fact, over 60% of Joe’s revenue comes from services targeted at women outside of nail services. In addition, Joe’s does not offer its customers premium salon products.

For example, they only offer 2 types of product lines. This puts Joe’s in direct competition with the local pharmacy and grocery stores that also carry these mainstream products. [Company Name], on the other hand, offers numerous options for exclusive products that are not yet available in [Town’s Name].

LUX CUTS

LUX CUTS has been in business for 5 years. LUX CUTSoffers an extremely high-end nail service, with introductory prices of $50 per service.

However, LUX CUTS will primarily be targeting a different customer segment from [Company Name], focusing on the households with an income in the top 10% of the city.

Furthermore, [Company Name] offers many of the services and products that LUX CUTS offers, but at a fraction of the price, such as:

  • Manicures
  • Pedicures
  • Gel Nails

Freddie’s Fast Salon

Freddie’s Fast Salon is located four stores down the road from [Company Name]. Freddy’s has been in business for the past 3 years and enjoys great success, primarily due to its prime location.

Freddy’s business offers inexpensive nail services and focuses on volume over quality. It also has a large customer base comprised of children between the ages of 5 to 13.

[Company Name] has several advantages over Freddy’s Fast Salon including:

  • An entertainment focused waiting room, with TV’s and board games to make the wait for service more pleasurable. Especially great for parents that bring their children.
  • A focus on service quality rather than speed alone to ensure repeat visits. [Company Name] will spend on average 20 more minutes with its clients than Freddy’s.

While we expect that Freddy’s Fast Salon will continue to thrive based on its location and customer relationships, we expect that more and more customers will frequent [Company Name] based on the high-quality service it provides.

Competitive Pricing

Type of furnitureJoe'sLUXFreddy's
Women's Cut$30-$40$40-$50$60-$70
Women's Color$60-$70$70-$80$80-$90
Men's Cut$20-$25$30-$35$40-$45
Highlights$65-$75$80-$90$85-$90

Competitive Advantage

[Company Name] enjoys several advantages over its competitors. These advantages include:

  • Location: [Company Name]’s location is near the center of town, giving us access to commuters going to and leaving the train station, local office workers, and passersby shopping in the city. We also offer adequate parking making it easy for customers to patronize us.
  • Great service at an affordable price: The complete array of nail services offered by [Company Name] nearly equals the most premium positioned competitor, LUX CUTS. However, [Company Name] will offer these services at a much more affordable price.
  • Management: Our management team has years of business and marketing experience that allows us to market to and serve customers in a much more sophisticated manner than our competitors.
  • Relationships: Having lived in the community for 25 years, [Founder’s Name] knows all of the local leaders, newspapers and other influences. As such, it will be relatively easy for [Company Name] to build brand awareness and an initial customer base.

 

VI. Marketing Plan

You can download the Nail Salon business plan template (including a full, customizable financial model) to your computer here.
[Company name] seeks to position itself as a respectable, upper-middle-market competitor in the nail salon market. Customers can expect to receive professional nail care from familiar technicians for a price somewhere between discount chains and luxury establishments.

The [Company Name] Brand

The [Company Name] brand will focus on the Company’s unique value proposition:

  • Convenient location
  • Familiar, regular technician
  • Significant personal attention
  • Moderate price point
  • Comfortable, customer-focused environment

Promotions Strategy

[Company Name] expects its target market to be individuals working and/or living within a 5-mile radius of its location. [The Company’s] promotions strategy to reach these individuals includes:

Local Publications

[Company name] will announce its opening several weeks in advance through publicity pieces in multiple local newspapers and publications. Regular advertisements will run to maintain exposure to relevant markets. Community newspapers, school publications, youth sports programs, and similar channels will be a major promotion effort.

Major Publications

We will make careful use of advertising in selected larger publications. [Publication or newspaper name] has a circulation of xyz and we can expect to reach a wider geographic region of customers on a limited basis. Advertisements with major publications will be used selectively, based on cost effectiveness. These ads will include discount coupons so that response to the ads can be tracked.

Community Events/Organizations

[Company name] will promote itself by distributing marketing materials and participating in local community events, such as school fairs, local festivals, homeowner associations, or sporting events. Since mothers are often heavily involved in such things, we will not only reach the lucrative audience of adult women but also potentially their families by extension.

Commute Advertising

We will drive attention toward [Company name] by hiring workers to hold signs alongside [route or highway]. Advertising on heavily traveled commute routes are an opportunity to alert large numbers of working individuals with disposable income of our opening.

Customer Loyalty Programs

[Company name] will create a winning customer loyalty program to keep its best clients coming back again and again. When not actively providing services to customers in the store, our professionals and other employees will make periodic, regular phone calls to customers. These phone calls will (a) ensure that customers are satisfied with their nail treatment, and (b) remind customers after a certain period of time has passed that they might want a new treatment. Long-term customers will have the opportunity to participate in the loyalty program, and referrals will be rewarded as well.

Direct Mail

[Company Name] will blanket neighborhoods surrounding its locations with direct mail pieces. These pieces will provide general information on [Company Name], offer discounts and/or provide other inducements for people to visit the salon.

Ongoing Customer Communications

[Company Name] will maintain a website and publish a monthly email newsletter to tell customers about new events, products and more.

Pre-Opening Events

Before opening the store, [Company Name] will organize pre-opening events designed for prospective customers, local merchants and press contacts. These events will create buzz and awareness for [Company Name] in the area.

Pricing Strategy

[Company Name]’s pricing will be moderate so customers feel they receive great value when patronizing the salon. The anticipated price point for a standard nail treatment is $25, in exchange for which a customer can expect to receive personalized attention during and after their visit. The customer can expect to receive quality nail care from a familiar technician, for a more affordable price than what they pay at an ultra-premium salon.
 

VII. Operations Plan

Functional Roles

[Company name] will carry out its day-to-day operations primarily on an appointment basis. Walk-in clients will be served by the earliest available technicians, but priority will be given to clients who called ahead. In the meantime, waiting customers can divert themselves in the lounge, which features television and current popular magazines. The Company intends to employ [X] technicians and [A] assistants during peak hours and [Y] technician and [B] assistants during off-peak hours. [Company name] anticipates having [Z] customers on a weekly basis.

In order to execute on [Company Name]’s business model, the Company needs to perform several functions. [Company name] anticipates using the services of X employees, divided into the following roles.

Service Functions

  • Manicures
  • Pedicures
  • Massages
  • Waxing
  • Gel nails
  • Product sales

Administrative Functions

  • General & administrative functions including legal, marketing, bookkeeping, etc.
  • Sourcing and storing products
  • Hiring and training staff
  • Appointment making
  • Customer service/cash register functions

Miscellaneous

  • Maintenance personnel

Milestones

[Company name]’s long term goal is to become the dominant provider of nail care and related services and products in the [city] area. We seek to the standard by which other providers are judged.

The following are a series of steps that lead to our vision of long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:

DateMilestone
[Date 1]Finalize lease agreement
[Date 2]Design and build out [Company Name] storefront
[Date 3]Hire and train initial staff
[Date 4]Kickoff of promotional campaign
[Date 5]Launch [Company Name]'s store
[Date 6]Reach break-even

 

VIII. Management Team

You can download the Nail Salon business plan template (including a full, customizable financial model) to your computer here.

Management Team Members

[Company Name] is led by [Founder’s Name] who has been in the nail salon business for 20 years.

While [Founder] has never run a nail salon himself, he has extensive at major salons for the past 20 years. He began his career in [19xx] when he received a certification from [Nail Tech School] and began work at [major chain], where he worked for X years.

[Founder] graduated from the University of ABC where he majored in Communications.

[Other person’s name] will serve as the customer service manager. He/she has extensive experience the hospitality industry.

Hiring Plan

[Founder] will serve as the store manager. In order to launch our salon, we need to hire the following personnel:

  • Nail Technicians [Number]

As dictated by demand and operational maturity, [Founder] will consider hiring the following personnel:

  • Nail Treatment Specialist [Number]
  • Receptionist [Number]
  • Store Manager

 

IX. Financial Plan

Revenue and Cost Drivers

[Company Name]’s revenues will come primarily from the services rendered and secondarily from the sale of nail care products.

As with most services, labor expenses are the key cost drivers for nail salons. Nail Technicians are paid through a combination of salaries and commission, rewarding them for performance and making Nail Technicians an active part in business retention and development.

The major cost drivers for the company’s operation will consist of:

  • Commission paid to Nail Technicians on a per service basis
  • Salaries
  • Lease

Moreover, ongoing marketing expenditures and cost of good sold expenses are also notable cost drivers for [Company Name].

Capital Requirements and Use of Funds

[Company Name] is seeking total funding of $260,000 of debt capital to launch its store. The capital will be used for funding capital expenditures and location build-out, hiring initial employees, marketing expenses and working capital.

Specifically, these funds will be used as follows:

  • Store design/build: $140,000
  • Working capital: $120,000 to pay for marketing, salaries, and lease costs until [Company Name] is cash-flow positive

Key Assumptions & Forecasts

The following table reflects the key revenue and cost assumptions made in the financial model.

Number of customers per dayPer location
Year 126
Year 229
Year 332
Year 436
Year 541
Manicure$25
Pedicure$35
Massage$40
Product Sales$20
Annual Rent$90,000

5 Year Annual Income Statement

Year 1Year 2Year 3Year 4Year 5
Revenues
Product/Service A$151,200 $333,396 $367,569 $405,245 $446,783
Product/Service B$100,800 $222,264 $245,046 $270,163 $297,855
Total Revenues$252,000 $555,660 $612,615 $675,408 $744,638
Expenses & Costs
Cost of goods sold$57,960 $122,245 $122,523 $128,328 $134,035
Lease$60,000 $61,500 $63,038 $64,613 $66,229
Marketing$20,000 $25,000 $25,000 $25,000 $25,000
Salaries$133,890 $204,030 $224,943 $236,190 $248,000
Other Expenses$3,500 $4,000 $4,500 $5,000 $5,500
Total Expenses & Costs$271,850 $412,775 $435,504 $454,131 $473,263
EBITDA($19,850)$142,885 $177,112 $221,277 $271,374
Depreciation$36,960 $36,960 $36,960 $36,960 $36,960
EBIT($56,810)$105,925 $140,152 $184,317 $234,414
Interest$23,621 $20,668 $17,716 $14,763 $11,810
PRETAX INCOME($80,431)$85,257 $122,436 $169,554 $222,604
Net Operating Loss($80,431)($80,431)$0$0$0
Income Tax Expense$0$1,689 $42,853 $59,344 $77,911
NET INCOME($80,431)$83,568 $79,583 $110,210 $144,693
Net Profit Margin (%)-15.00%13.00%16.30%19.40%

5 Year Annual Balance Sheet

Year 1Year 2Year 3Year 4Year 5
ASSETS
Cash$16,710 $90,188 $158,957 $258,570 $392,389
Accounts receivable$0$0$0$0$0
Inventory$21,000 $23,153 $25,526 $28,142 $31,027
Total Current Assets$37,710 $113,340 $184,482 $286,712 $423,416
Fixed assets$246,450 $246,450 $246,450 $246,450 $246,450
Depreciation$36,960 $73,920 $110,880 $147,840 $184,800
Net fixed assets$209,490 $172,530 $135,570 $98,610 $61,650
TOTAL ASSETS$247,200 $285,870 $320,052 $385,322 $485,066
LIABILITIES & EQUITY
Debt$317,971 $272,546 $227,122 $181,698 $136,273
Accounts payable$9,660 $10,187 $10,210 $10,694 $11,170
Total Liabilities$327,631 $282,733 $237,332 $192,391 $147,443
Share Capital$0$0$0$0$0
Retained earnings($80,431)$3,137 $82,720 $192,930 $337,623
Total Equity($80,431)$3,137 $82,720 $192,930 $337,623
TOTAL LIABILITIES & EQUITY$247,200 $285,870 $320,052 $385,322 $485,066

5 Year Annual Cash Flow Statement

Year 1Year 2Year 3Year 4Year 5
CASH FLOW FROM OPERATIONS
Net Income (Loss)($80,431)$83,568 $79,583 $110,210 $144,693
Change in working capital($11,340)($1,625)($2,350)($2,133)($2,409)
Depreciation$36,960 $36,960 $36,960 $36,960 $36,960
Net Cash Flow from Operations($54,811)$118,902 $114,193 $145,037 $179,244
CASH FLOW FROM INVESTMENTS
Investment($246,450)$0$0$0$0
Net Cash Flow from Investments($246,450)$0$0$0$0
CASH FLOW FROM FINANCING
Cash from equity$0$0$0$0$0
Cash from debt$317,971 ($45,424)($45,424)($45,424)($45,424)
Net Cash Flow from Financing$317,971 ($45,424)($45,424)($45,424)($45,424)
SUMMARY
Net Cash Flow$16,710 $73,478 $68,769 $99,613 $133,819
Cash at Beginning of Period$0$16,710 $90,188 $158,957 $258,570
Cash at End of Period$16,710 $90,188 $158,957 $258,570 $392,389

 

You can download the Nail Salon business plan template (including a full, customizable financial model) to your computer here.