WELCOME! If you found yourself stumbling onto this guide you may be asking yourself, what is Salons by JC? and are salon suites right for me? Well, we re here to help answer your questions and inform your decision about whether a salon suite would benefit you. If you find yourself asking any of the following questions then moving to a salon suite could be the right choice for you: How do I get more freedom at my current salon or with my current employer? WhatdoIhavetodotosetmy own hours? How can I make more income from what I do? Is there a better option than just renting a chair? How can I start my own salon without all the hassles that come with it? Is there something better out there than what I m currently doing? Salons by JC is one of the largest and fasted growing salon suite operators in the U.S. and Canada and one of the few to offer turnkey options to cosmetologists AND provide an onsite concierge to help you with your day to day needs. You can find a brief history of Salons by JC here. For the Manhattan market, Salons by JC is focused on creating the highest end salon suite offering because we believe an upscale beauty market deserves a luxury salon suite! Our first location at 124 W 24 th Street nestled right in the middle of the Chelsea and Flatiron neighborhoods will be just that. We have totally redesigned the buildout with a modern look and gorgeous finishes. This space will define luxury within the salon suite industry. On the following few pages, you ll find some frequently asked questions to determine if you re ready to make the jump to a salon suite and whether Salons by JC is the right partner for you. 2
How do salon suites work? So if I license a room, then what? What can I do with my suite? Salon Suites is the name of a concept focused on licensing out individual rooms called suites to professional cosmetologists looking to run their own business without going through the hassles of looking for real estate, managing a construction process, hiring employees, dealing with payroll, and all the other issues that arise when starting a business. The only thing the cosmetologist has to deal with is paying a weekly fixed membership fee determined by the size of the suite. That s it. The cosmetologist is free to keep whatever income they make from services rendered and products sold. The furnished facility is equipped with a members lounge, washer/dryers, free utilities, free WiFi, restrooms, and 24/7 access. Once you license a suite, you re free to paint, decorate, and do what you wish in your suite as long as you are licensed to provide that service*. Each room comes with standard cabinetry, mirrors, a wash bowl and sink, and multiple electric outlets. You will receive your own key to your suite and only you decides who has access. You will also be given a frontdoor code to access the facility outside of normal business hours. In addition to your suite, you will have access to all common areas within the facility such as the members lounge, washer and dryers and restrooms. * Note: In New York state, cosmetologists are required to carry a NY cosmetology license for their particular practice area in order to operate professionally. 3
How do I know if I m ready for a salon suite? This is a very common question and one you should think about carefully. A salon suite is for those cosmetologists who generally have a full or near full book of clients and no longer require the benefits of working for someone else (i.e. new walk in clients, education, etc.). A suite is typically priced for 30% or more the going rate of a chair rental in the market but keep in mind many chairs are priced on a five day a week rental and have set hours of operations. If you feel like you can comfortably afford the price of a chair rental in your market then making the step up to a suite rental should not be a problem for you. Beyond price, you will also need to determine if your personality is the type that is better suited to working for someone else with a set structure or if you re someone that has always wanted to be their own boss and is comfortable with the responsibility of managing your independence. If you are the latter then a salon suite will be the right fit for you. Can I share a suite? Yes, absolutely. There may be a small additional fee per person. If you choose to share your suite then it is up to you and your partner how you split the membership fee and occupancy of the suite. 4
If I don t have a full book of loyal, repeat clients, should I consider a salon suite? Yes, if you feel like your existing clients provide enough income that you can cover the cost of a chair in your market then you will likely be abletocoverthecostofasuiteaswell. Keep in mind that under a rentalmodel you will be keeping a greater percentage of your income from clients versus a commission based model. In Manhattan, the average commission based hair salon keeps 50 60% of each service provided by the stylist and tips are often shared amongst employees. In addition, the typical salon takes a 90% commission on product sales decreasing your incentive to sell products. In a rental model, you keep 100% of the income for each service and additional tips AND 100% of the profits from each product sale: Price of Product minus: Cost to Buy Product equals: Product Profit Product sales can generate a large increase to your income. Whatever you make from product sales can more than pay your weekly membership. 5
So how can I calculate my income potential in a salon suite? First you need to determine a few things: 1) What does your average client spend per session? 2) If you work in a commission salon, how much is the commission? If you rent a chair, how much is the cost of the chair? 3) How much product do you sell a week? How much of the sale do you keep? The way to calculate your income in a salon suite assuming equivalent pricing of services and products is shown below: Commission Based Real Salon Suite Real Income Salon Income Calculation Example Income Calculation Example Difference Avg client spend $100 Avg client spend $100 x # of clients / week x 25 x # of clients / week x 25 x % of service kept by stylist x 50% x % of service kept by stylist x 100% A. Weekly Service Income => $1,250 A. Weekly Service Income => $2,500 A. $1,250 per week Avg price of product sold $25 Avg price of product sold $25 x # of products sold per week x 10 x # of products sold per week x 20 x % commission on sale x 10% x % gross profit on product x 60% B. Weekly Retail Income => $25 B. Weekly Retail Income => $300 B. $275 per week Weekly Service Income $1,250 Weekly Service Income $2,500 + Weekly Retail Income + $25 + Weekly Retail Income + $300 Suite Rent / week $800 x 52 weeks x 52 weeks x 52 weeks x 52 weeks C. Total Annual Income => $66,300 C. Total Annual Income => $104,000 C. $37,700 per year Note: Examples above exclude tip income and assumes stylists sells twice the product in a salon suite given greater profit incentives. Our website offers an interactive calculator to determine your personal income potential: http://salonsbyjc.com/lease vs commission 6
So how can I calculate my income potential in a salon suite? (continued from prior page) As highlighted in the simple illustration on the prior page, a hair stylist can nearly double their income in a salon suite vs. a traditional salon charging 50% commission on services and 90% on product. The above examples assume the same number of clients per week, the same client spend, and the same cost of product sold. The only difference in the examples is that a hair stylist sells double the product in a salon suite vs. a commission salon. Why would that be so? Well, if you receive 60% of the proceeds on a $25 shampoo (or $15.00) instead of the salon standard of 10% (or $2.50), you're probably going to try a lot harder to sell that shampoo! If you don't want to sell products in your salon suite that's completely fine too. While making more money is always great, ultimately the goal of a salon suite is to provide you, the cosmetologist, more freedom doing what you love on your own schedule, not someone else s. Whatever you decide to charge your clients and for your products is entirely up to you. 7
What do you mean when you say I ll have more freedom? Simply put, once you choose your suite, you can decorate and furnish it any way you want to. We can help you in the process by referring contractors to paint your room or with installation of special equipment. So I can make more money and enjoy more freedom what s the catch? There s no catch and we never intend to mislead you here at Salons by JC. We want to make your life as easy as possible in a luxurious space you can fall in love with. Beyond that, you will receive a key to your room and a secure access code to the facility. You choose when and how you want to work. If you want to work on a Sunday at 11pm, then you re free to do so. If you want to take a four day weekend, then by all means enjoy the long weekend! The hours you work are totally up to you. In the same way, the prices you set for your services and products are completely in your control. We ve designed our Manhattan locations so that you re proud to call the space your professional home and a space your clients are happy to come to. The only thing you have to deal with is paying a weekly membership fee for your suite. That s it! 8
How much is the weekly membership fee and how does the process work? For business reasons, we do not share the prices of suites online but are happy to discuss options with you over the phone or in person. What we can say is that the average chair rental in Manhattan is about $600 for a five day workweek with set hours and limited space for personal belongings. Youwillchooseasuitedependingon availability and each suite is priced on a weekly basis based on the size of the suite. To secure a suite, you will sign a one year membership agreement and put down a deposit equal to a one week membership fee. Our suites are priced modestly higher than a chair but you will have access to the suite 24/7 and there will be plenty of space for your belongings. You no longer have to work out of a suitcase! Membershipforyoursuitewillbepaid weekly and included in your fee is WiFi access, laundry and utilities such as water and electricity usage. 9
Can I cancel my membership before the year is over? What happens after the year is up? We understand that life events happen or maybe salon suites just aren t your thing. If you do have to leave before your membership is up, the only two things we would require from you is a repayment of any free membership fees received and that you kindly restore your suite to its original condition. If we need to make any modifications to your suite we will deduct any charges incurred from your security deposit and return the rest. If no modifications need to be made, you will receive the full deposit back no questions asked. You give us back the keys, and you get back your deposit! After your one year membership is up, you ll automatically be on a rolling membership which will be in good standing as long as you re paying your weekly fee. We don t require a new agreement to be signed after the one year is up as we ve found most cosmetologists are so happy they stay around for the long haul! 10
Contact Us! OK, I m ready to sign up, what do I do? Great news! We re excited you ve chosen this exciting path in your career and that Salons by JC Manhattan will be a part of that journey. To secure a suite, you can contact us directly via the contact form on our website, by e mailing nyc@salonsbyjc.com, or by calling us at (646) 798 2211. We will discuss all the available options that could work for you and then if you re ready to sign up, we will require a fully refundable deposit to secure your place on the waitlist. Since the 24th street location has 45 suites we have limited spots on our waitlist, so don t delay! Once you re ready to move in, we will hand you the keys to your very own suite along with a security access code to the space. Whether you opt in for the waitlist or want a guaranteed suite, you will receive your deposit back no questions asked if for some reason you change your mind before we open this Fall. We are serious about this guarantee as we know things happen in life, and hey, you may come back to us in the future! Address: 124 W 24 th Street New York, NY 10011 Phone: (646) 798 2211 E mail: Website: Contact Information nyc@salonsbyjc.com www.salonsbyjc.com/ manhattan 24th street 11