If you are reading this, it means you are wondering how salon chair rental, also known as booth rent, works. As a salon owner, you may not be sure what ALL the questions are to ask, but don’t worry!  While there is much to know, some of the answers you’re looking for are here. 

What is Salon Chair Rental? 

Salon Chair Renting is when a salon owner provides workspace and amenities for stylists, and these stylists will pay rent and have control over their booth, running it as their own business within the salon. For the owner, this means that you get to obtain rent regardless of how many clients the booth renter sees. However, for the most part, you are not responsible for how the stylists run their business.

While appearing simple, offering a booth rental model can have its challenges.  As with any choice, a good place for you to start is by considering the pros and cons of booth rental.

The Pros and Cons of Booth Rental

Pro #1:  Lower Costs of Doing Business

As the owner, you can reduce the costs of running your business by renting booths to stylists.  The rent you charge can cover expenses you would otherwise be 100% responsible for, i.e., lease, employment taxes, healthcare for stylists, perks, etc. 

Rent you get from stylists reduces your expenses because they will pay some portion of running the business, which means more profit for you.

Pro #2:  More Reliable Income

You can charge renters a fixed rental which is paid to you regardless of how many clients they have.  To figure out your booth rent pricing, consider your TOTAL business expenses, how much you can and want to pay for the costs, and then determine how much you can charge renters that the market in your area will bear.  

Be sure to do your homework in your local area to determine what you can charge.

Pro #3:  Building the Business Team You Want

As the owner, you get to select who will be in your salon all day.  You get to interview and choose who will represent you and your business.  

Start by knowing the environment you want to create in your salon and then make a list of potential stylists’ characteristics to make it a great place for clients.  

Ask yourself, "Do they have the education, skillset, and personality I want?”  Then, renting booths to individual stylists can get you the team you want.

Con #1:  You Have Less Control Over Your Business Brand

The renters are also business owners with their brands. So no matter how well you vet them, they will do their own thing to some extent.

To help mitigate branding problems, you could offer light marketing for the salon to keep overall brand recognition for everyone.  

Your stylists will see this as a perk. Because of your marketing for everyone, they will see themselves as part of a business more extensive than just their booth. They will conduct themselves more as team members rather than independent contractors.

Con #2:  A Booth Rent Model Could Be Complex if You Don’t Like Being a Leader or Manager.

Thinking about your personality in a leadership or management role is crucial.  Renting booths to individuals means you have different characters spending time together while also being dependent on each other.  

They will represent the salon to each other’s clients, and they may answer phones; they’ll be responsible for keeping the salon clean, agreeing on the inside temperature, choosing the music to play, etc.  

You, as the owner, will be required to lead by example and show how to be a good steward of the business.  You will also be accountable for conflict resolution.  Consider if you want to play this role.

How Will I Charge for a Salon Chair Rental? 

1. Research your local market and do some competitive pricing analysis, check out social media platforms, and ask other industry colleagues who might know. 
2. In 2020, booth rental around the country was as high as $1000 a month in Manhattan, but it was more typical to charge $150-$400/mo depending on location. 
3. Figure out your business expenses.  For example:

• Lease payment
• Property taxes if applicable
• Insurance – renters, equipment, liability, etc.
• Banking including credit card fees
• Software – not going "old school.”
• Cleaning fees and supplies
• Utilities – HVAC, internet,
• Association dues – if you’re part of a business park

Considering how much of the business expenses you can pay will help you determine how much to charge booth renters.  You can find more information about booth rental finances at  https://bizfluent.com/how-12098216-figure-rent-salon-booth.html

Salon Chair Rental Agreements

A rental agreement is a must—a MUST FOR BOTH PARTIES.  The purpose of the deal is to write down all expectations, so there are no misunderstandings.  The lease includes but is not limited to the following:

• The lease rates.
• The length of the contract.
• Who sets prices and collects the money?
• Who pays insurance? 
• What you, as the owner, will make available to renters, i.e., use of reception area, utilities, credit card machine, shampoo area, and other salon equipment you choose.