Format for Grade 12 Cosmetology
Business Plan (Salon Management)
Your business plan must contain the following:
1. Introduction (3 pages)
a. Title page-The title page should include the title “Business Plan”, the
name of the company, the date of the plan, and the company’s address and
phone number.
b. Overview (sometimes called the Executive Summary)- should be one page
in length (double spaced). This should be written last. It is a concise
summary of the business plan’s main topics. It is a shortened version of
all the main topics.
c. Table of Contents- Should be completed after the plan is complete.
2. The Company (1pages)
a. Type of ownership- Sole proprietorship, partnership, or corporation.
Explain the reasons you chose this type of ownership. The present owners
of the company should be listed by name.
b. Management- A brief description of the company’s management team
should list each manager along with a short resume of each (the resumes
may be included in the last section)
3. The Product (1-2 pages)
a. Product description- Give a brief description of the product and or service.
b. Proposed research and development-If there is further research and
development work to be performed, proposed activities should be
described.
c. Pricing considerations-The business plan should state the price of the
product or service and how it compares with the competition.
4. The Market (2-3 pages)
a. Market Niche- You should describe the “uniqueness of your products or
service and the customer needs it will satisfy. What makes your product
or service “special”?
b. Customer Profile-You should provide a summary of your business’s target
market by describing your average customer. You should identify which
segment of the population is most likely to purchase the product or
service.
c. Total market size-You should give an indication of the total number of
potential customers for your product or service.
d. You should attempt to state whether the product or service’s market is
growing, stable, or declining.
e. Competition-You should compare the strengths and weaknesses of your
product or service with those of the competition. (You will have
competitors- either direct or indirect). You should identify the product or
service’s competitors, their location and try to identify the current size of
their market share. Large or powerful competitors will have the resources
to undercut prices, run special promotions, etc. to keep new competitors
out of the market place. You should try to anticipate the reaction of the
competition to your entry into the market place and how you plan to
counteract their actions.
This section requires a lot of careful thought and reflection.
f. Promotion-You should describe how you intend to promote your product
or service. Include at least three different types of advertising or
promotion. Include flyers, ads, business cards or any other form of
promotion in the Appendix.
5. Operations (1-2 pages)
a. Geographical location-You should describe any facilities that are already
in place, and try to anticipate future requirements. You should state why
your chosen location is suitable.
b. Human Resource Requirements- You should estimate the number of
people required to work in your business. You should describe the jobs
for all employees. Resumes for at least three potential employees needs to
be included in the Appendix.
6. Financial information (3-5 pages)
a. Management Compensation- You should include a summary of the
salaries paid to the owner and other key personnel. Are the employees
getting commission, if so how much? Are they getting a base pay? If so
how much? Are they chair renting? If so how much?
b. Cash flow projections and a budget need to be summarized here. Your
cash flow projections sheet can be included in the appendix. Your cash
flow projections for products sold need to include three different lines of
product and include pricing for one shampoo, conditioner, and two styling
products for each product line if you are in a hair salon. See the cash flow
projections sheet given with the question handout.
Once you have calculated your gross profit using your cash flow
projections, use the “Average Expense for Salons in the United States” on
page 660 of your textbook to complete a projected budget.
7. Strategic Plan and Timetable (1-2 pages)
a. You should identify immediate objectives (less than one year),
intermediate objectives (one to five years) and long-term objectives (five +
years). Be realistic and concise. You want to be able to show that your
business will be profitable on a long-term basis.
Objectives may include (but not limited to) the following: Development
of certain methods, setting sales volumes, contracting with others, plans to
get into new markets, plans to add to your service or product lines, plans
for future development, plans to meet threats posed by the competition.
You should have a timeline which includes completion of your most
important goals
8. Appendix:
Should include all promotional material, including advertisements, business cards,
radio ads, flyers, etc., resumes from at least three potential employers, cash flow
projections, and a computer generated floor plan layout and a 3-D layout of the
salon using appropriate colour schemes, and floor plans (see page 662 in the text
for more information on how to create an effective layout).
Assignment modified from Mr. Kruse’s “Student Constructed Business Plan”.