by: Christina Quinn, Owner of Diztinctive Beauty
Starting in the Nail industry can be so nerve-wracking and beautiful all at the same time. There are so many factors to consider such as product, tools, setup, continuing education etc. There are three different ways you can start working in the nail industry; the first is as an hourly employee, rates always vary depending on where you are located. Then the second way is a commission based employee, so you receive a percentage on every client you provide a service for. The most common commission percentage is 50%, and with these two types of jobs the employer will purchase all of your product, provide the tools, and space for you to work in, you just show up and do your thing. Lastly, but most importantly is booth rent, or working as an owner, now you are 100% responsible for EVERYTHING.
There is nothing more stressful, yet exciting than owning your own business and being in charge of it all! It is essential to ensure you have all the basics, don’t worry too much when first starting that you don’t have it all, we all have to start somewhere.
The biggest mistake we see when business owners first start is not budgeting correctly. When you start seeing the $$ roll in as you get busier, you want to run out and spend that dough because you are a big time business owner right? Not the case, because the next time you need to go and buy your supplies, and the bill comes in at $300, if you don't budget for your supplies, odds are this expense will end up getting paid with credit. Then it will be a never-ending cycle of debt, and no one likes debt.
The sooner you can get in the habit of doing a budget the better. So here’s what we suggest to do and why. Organizing your accounts are the most important first step. You always want to separate your business and personal accounts, always! You want to start with three accounts, business chequing, business savings and a business credit card. It sounds like a lot but there is a method!
First, for the business chequing account, whether you only take cash or e-transfers, you need to put the money you make all in one place so you can divide it accordingly. You don’t need an actual business account when first starting out, just a simple chequing account that you have dedicated to your business works well and usually, it is only a few dollars per month in banking fees.
Second, is your business savings, this is so important because if your UV light burns out, your desk vent stops working or your e-file decides to quit working, you will have your savings to fall back on. Or when there is a nail show in another city that you want to attend, your business savings can help get you there! If you spend what you make without giving any thought, then it makes it pretty difficult to afford education and supplies.
Last but not least, a business credit card, for all of those purchases that you need to make online. We suggest having one for personal and one for business. There is nothing more time consuming and annoying than having to go through two different credit card statements at the end of the year trying to determine what was for business and what was personal.
Here is a tried and true system, once a week add up everything you made and make your deductions from there. So if you bring in $1500 from your nail clients and your weekly rent is $100. Then minus rent off the total made in the week, which leaves $1400, then divide the $1400 in half, which leaves you with $700 for your pay. The other $700 gets split in half again, so $350 is going into business savings, and $350 is going towards salon supplies.
As you can see within a few months time you will have decent business savings. If you find one week you spend a little more on your salon supplies you will have a nice little cushion in your account so you aren’t left stressing after you purchase everything you need, and you can’t go wrong with that!