Health & Beauty Franchises UK – the TOP 10 MUST KNOWS about finding and running a successful UK Health & Beauty Franchise.
If you have the right skill set and temperament, beauty franchises have a lot to offer to you. Here’s all you need to know about beauty salon franchises in the UK.
In our blog, we often talk about various franchise business sectors. This article about spa and beauty franchises comes as a perfect fit for this series – especially given the fact it represents one of the most underrated yet undeniably vibrant section of small businesses in the UK.
Franchising is on the rise – as it has been for years now. A lot of its success is due directly to the fact that the very nature of employment is changing – and changing fast. In the UK, more and more people are looking to be self-employed, with special focus on being an entrepreneur.
The unfortunate part is that the spirit of ‘starting up’ has been somewhat lost on us, thanks to a handful of billion-dollar tech ventures. The fact is – to feed your entrepreneurial ambitions, you don’t always need to blaze a trail or break new grounds. Starting a business of your own that does the same old thing better is often enough.
To understand what we mean by this, look no further than beauty franchises around you. In this post, we will discuss how these franchises work, what sort of investment is required, what goes into making one successful and what potential downsides there exist.
Spa, Beauty and Barber Franchises UK – Crunching the Numbers
As always, our analysis of spa and beauty franchises in the UK starts with some numbers – both good and bad. To keep things fairer, we will consider the overall performance of the industry, rather than limiting ourselves to the franchising aspect of it.
- The spa, hair and overall beauty industry in the UK is a bigger deal than you think. At an annual revenue of over £4 bn, it forms one of the most important arms of personal care businesses.
- Being entirely consumer facing, there are obvious struggles associated with the industry. Despite these, the industry has managed to grow steadily at nearly 1.5% each year, over the last four years. This rate is just a few points above the average annual growth rate of the national economy.
- The number of independent salon, spa and beauty businesses in the UK has also shown similar growth numbers. As things stood in 2018, 34,000 to 42,000 businesses can be counted as a part of this industry.
- Most of these businesses are small to medium sized, with 70% employing fewer than 10 people.
- The UK beauty industry employs over 150,000 people.
- The most interesting stat in this regard – the beauty services industry in the UK is largely localised and fragmented, with no major national players. In fact, the 3 largest UK beauty businesses have a combined market share of less than 3%. This is an extremely promising sign for franchisees who want to run a local beauty franchise.
Changing Social Norms and Beauty and Hair Salon Franchises
While discussing various franchise businesses and their potential, we always make it a point to dig deeper than just the numbers.
When it comes to discussing beauty and hair salon franchises in the UK, it’s important to understand how the changing social norms have contributed to the growth. The most promising sign in this regard is the annual spending – UK adults now spend over £6 bn annually on beauty treatments, hair care and other spa services. Much of this surge can be assigned to the penetration of the industry into demographics that would – not too long ago – have been considered off the table.
How Do Hair Salon and Beauty Franchises Work?
Hair and beauty franchises are service providers. While it’s true that many businesses also include products as a part of their offerings to diversify revenue streams, it can’t be denied that the performance of the ‘services’ is the decisive factor in this context.
So, to understand how these franchises work, it’s important to understand how a service-based franchise works.
Let’s outline the three building blocks of service-based franchises.
A. Market Research
One word – important.
We understand that it can be overwhelming for a person not initiated in the world of numbers, data and business to make sense of this – but we strongly recommend that you base all your future franchising decisions on this foundation. A typical hair salon and beauty franchise market research will involve the overview of operational competitors in the territory, assessment of the location, study of the target demographic and a broad-ended profitability analysis.
For example, if you wish to run a beauty franchise in in a major city centre, you may find that the market is already nearing saturation. The way out would be to focus on a non-saturated niche (oriental beauty treatments, for instance). On the other hand, if you want to run a spa franchise in a mid-sized town, you may find that there isn’t a lot of demand for niche services. So, instead, you can focus on doing better what’s working for your competitors. All these ideas will help you narrow your search down for the perfect franchisor.
B. Choosing the Right Franchisor
This can be the most critical step of the entire process. This is also a question we get asked hundreds of times each week from our readers. If you aren’t sure how to go about assessing franchisors on your shortlist, do feel free to check out our free how to choose the right franchise guide.
Once you are certain that there’s a market large enough for a new franchise, you can shortlist franchisors that operate in your area. If there aren’t any, you can ask around to see if any franchisors are willing to enter the territory.
Read and understand what the terms of their franchise agreement are, what their business model is and what sort of training, customer service and marketing support the franchisor is willing to offer. Many hair salon franchises operate on a flat-commission basis per month, with the rest adopting the royalty model. Consult with a qualified business adviser to understand the long-term impact of all options, so that you can strengthen your top line revenue.
C. Running the Business
If you get the first two steps right, this one can be a walk in the park – especially if you have prior experience.
This is not to say that running a hair salon franchise is easy. From the initial marketing difficulties to gradually, organically securing a loyal base of customers – it can be a tricky chase. Important things to remember in this aspect are: hiring well-trained staff, managing overheads, re-investing in marketing (on your own or through your franchisor) and staying innovative.
How Much Does It Cost to Buy and Run a Barber and Beauty Franchise UK?
Considering the franchise fees and the initial spend to get the business off the ground, beauty franchises can cost you a lot.
Of course, this is always subject to the location, and you can always expect to make this money back provided you have got your market research right and your services are top notch.
A conservative estimate after studying dozens of beauty and hair franchise opportunities tells us that you may need upwards of £30,000 in minimum initial investment to get started. This number can go down if you choose a franchise that caters to a specific niche like beauty and hair services for children.
The main outgoings to consider are:
- Regular operational costs – insurance, rent, utilities, equipment, inventory etc.
- Staff salaries
- Franchisor fees (commission/royalties)
- Marketing expenses
UK Beauty Franchises and the Importance of Location
Despite being a service-based business, the location is enormously important for beauty and hair franchises.
On this front, these franchises resemble fast-food franchises – the more the footfall, the better the performance.
Therefore, it’s essential for you to explore, assess and compare various locations and territories before you buy a franchise. Ideally, your territory should have a large enough concentration of the target demographic to sustain your business, and your location should be convenient enough for them to visit.
Do You Need to Be a Licenced Beautician to Run a Beauty Franchise?
Not really. You can buy and run a beauty franchise even when you don’t have the necessary professional licence. You can, however, only allow trained and licenced staff to perform the treatments, while you oversee the business as the owner.
In fact, this is one of the reasons why franchising has grown so rapidly in the UK. You can identify opportunities in an industry that you aren’t personally familiar with, buy the right franchise, hire the right people and run your business towards profitability.
Beauty Franchises: A Perfect Home-Based Opportunity
If you are trained and possess the necessary licences, you can buy a beauty franchise and run the business right from your home.
In fact, as you may have already noticed around you, a large share of local hair salons and beauty businesses tend to be home-based. Running a franchise business from home can help you get started as quickly as possible, while bypassing many overheads that come with renting a dedicated location.
Three Key Factors That Can Make or Break a Hair Salon Franchise
While there are dozens of factors that go into the making or breaking of a business, these are the three prominent ‘pain-point’s for beauty and hair salon franchises in the UK.
A. Money Management
Clueless money management is guaranteed to take a beauty franchise downhill, simply because the business model is highly vulnerable to spending habit fluctuations of people.
So, being judicious while spending is vital. A good strategy can be to re-invest heavily in marketing and services while cutting down on unnecessary overheads, getting out of expensive debts as soon as possible and raising cheaper capital.
B. Skilled and Reliable Staff
Hire staff that bring on board various skills, can be banked upon to offer nothing but high-quality services and are passionate about what they do. Beauty businesses thrive on personal relationships, and your staff should be able to build these with your customers to secure repeat business and improve the lifetime value of each customer.
C. Cautious Aggression
Health and beauty franchises have one thing in common – the word of mouth plays a huge part.
To make sure that your beauty franchise isn’t missing out on free, passive marketing, focus on improving your social media presence, hire the services of digital marketing experts, participate in local events, maximise the marketing potential of local channels and make your business an important part of the community.
If your franchisor is taking care of marketing for you for a fee, discuss with them how you can invest more to get faster results.
Top Beauty Franchises UK
Here are some of the popular beauty and hair salon franchises in the UK*.
- Minimum Initial Investment: £16,000 (plus VAT)
- USP: Original, new-age beauty treatments and slimming programs
- Full training
- Experienced network head
- Exclusive territories
- Location assistance
- Bespoke products
- Minimum Initial Investment: £87,000 (plus VAT)
- USP: Comprehensive beauty treatments for men and women; organic, original products
- Training and support
- Marketing support
- Valuable brand name
- Associate BFA Member
- Minimum Initial Investment: £15,000 (plus VAT)
- USP: Unisex hair care services
- In business for over two decades
- 60+ units in operations across the UK
- Full training
- Growth programs
- Associate BFA Member
- Minimum Initial Investment: £25,000 (plus VAT)
- USP: Industry leading hair and beauty services
- Training provided
- Tie-ups with leisure clubs
- High-street favourite for over 30 years
- Full BFA Member
*The information provided in this section is merely indicative in nature. Please contact the respective franchisor for more information.
Health, Beauty and Hair Franchises UK: The Takeaways
- Research the market carefully.
- Explore the scope for innovations.
- Re-invest in marketing.
- Hire reliable, skilled staff.
- Focus on building personal relationships with customers.
- Choose a location that ‘sells’.
- Manage your debts carefully.