How to set a business with 100k
Setting up a business is one of the most amazing experiences one can ever imagine. After months or even years of planning and contemplation about what, how and where to setup the business, it is always a delight to see the fruit of your labor become a reality. It is hard work I must confess, as lots of business ideas by entrepreneurs never saw the light of day.
Yesterday evening I had the unique opportunity of discussing with a young barber who gave me a lovely hair cut. I was asking him some questions relating to the profitability in the hair barbing salon business. He was candid and absolutely honest in his review and analysis of the business. His feedback made me to conclude about using the hair barbing salon as a case study of how to set a business with 100k.
It is vital that anyone trying to setup a business with 100k must have known the type of business he or she was to setup in advance and drawn a simple business plan. The business location must have been known and the startup capital should be readily available before thinking of setting up the business.
Case analysis-barbing salon
The first step my young barber friend called Gentle shared with me was the need to undergo or learn how to barb before going further to rent your own barbing shop. It is like going for an apprenticeship training program before gaining freedom and starting a business of your own. The time duration for learning how to barb vary from person to person. Some guys are very sharp and can learn very fast before one year. Some can even become good in the act of barbing by the sixth month of their training. So it’s an individual thing and there’s no fixed time duration. The training is usually free in some cases, because the apprentice usually helps the owner of the shop and all the money generated within the period of learning usually goes to the owner of the shop.
-Once you can comfortably barb a client hair without complaint and you can equally barb different hair style depending on the current trend, you are set to go. The next big step is for you to rent your own barbing shop. Ensure you don’t start too big. Rent a small and moderate shop that is located within your vicinity. Ensure there is enough population there and the place is decent enough. Make your shop unique by painting and putting carpet for clients comfort. A ceiling fan would be a nice accessory to be installed for good ventilation, especially in hot season. You will need to buy chairs for both those who will be barbing and those who will be waiting.
-After securing your shop, you go ahead and buy original clipper. Gentle suggested going for Chaoba original clipper that also comes with a bag, sterilizer and aftershave. The reason you need original clipper is because you can’t compromise quality at the detriment of client comfort. You must also get a standby generator. A generator is compulsory due to the incessant power outage in Nigeria. A barbing salon that depends on public power supply cannot achieve good profit.
-Aside the clipper, ensure you get sterilizers, for sterilizing the clipper to ensure possibilities of communicable disease like HIV is reduced. Also, sterilization of clipper helps reduce the incidence of bumps on the head of clients who don’t have their personal clippers, but depend on public clippers. Most barbing shop also ensures they don’t use the same clipper for two different clients. While they sterilize one, they use their spare clipper and thereby reduce chances of passing on communicable diseases.
He mentioned some side opportunities available to a barber who owns a barbing shop as offering home service and selling recharge cards as well as home video CD’s for profit. This would be an amazing income stream especially if you are good in this line of business. One can always have opportunity to make more income in this business as long as you are organized and exceptionally good to clients.
-When I asked about some challenges barbers usually faced in the course of their business, gently mentioned lack of electricity supply as the number one problem they usually face. More than 20% of their profit margin goes into fueling standby generator whenever there is power outage.
-Another challenge they usually face is the issue of fuel scarcity, especially in areas where hoarding of fuel is a common sight. When they buy this fuel from black market, it becomes extremely difficult for them to meet up their income target at the end of the month.
-Renting of shop for a year will cost N24, 000
-Original Chaoba clipper is N3, 600 per clipper making it N7, 200 for two sets of clippers
-Cost of 6 plastic chairs is N15, 000 at the rate of N2500 per plastic chair.
-A standard mirror with shelf for keeping clippers and other items can be gotten for N15, 000
-4 cover cloth for clients will cost N2000.
-Barbing cosmetics like spirit, powder, aftershave and sterilizer can be purchased at a cost of N3300.
-A small generator will cost N25, 000
-A standard ceiling fan can be purchased for N5, 000.
-Carpet can be sourced for N3000
-Broom and packer cost N500
Amounting to a grand total of N100, 000
Profit analysis will be subject to creativity, ingenuity and ability of the barber to satisfy clients need each time. That being said, it’s important we do a little profit analysis using an average of 20 clients coming to barb their hair in a day. The number can be higher, depending on the location and the day (people usually flock down to barbing salon on weekends). Based on 20 clients per day at the rate of N200 per hair cut for adults, a barber will get N4000 daily and for 30 days, will earn a total of N120000. This can go higher for example during festive seasons, as more people tend to barb their hair during this season to appear presentable.
As I was about to walk out of the barbing salon on Saturday evening after spending quite some time listening to Gentle, I reminded myself of the need for anyone planning to setup the business to be patient and also to get a name for the barbing salon business before startup. By the way, his barbing salon is aptly named- “Gentle Haircuts”. I thanked him for that final advice and started strolling home. I now understood a bit of what goes on within the confines of a barbing hair salon apart from the financial involvement that goes into seeing it operational. Indeed I came to a conclusion that the hair barbing salon business is worth giving a try.