Renting a chair in a hair salon: Direct Line for Business gets the lowdown Renting a chair in a hair salon

Renting a chair in a hair salon: Pros & cons

Renting a chair in a salon is very common in the hair and beauty industry, particularly for barbers and hairdressers.

It’s a proven model, with clear advantages for both the salon and the hairdresser, but can only work in the long-term if the terms agreed are good for both parties.

In this this article, which we created with the help of Abingdon & Witney College, we take a closer look at how renting a salon chair works, including the pros and cons of this system.

How does renting a chair in a salon usually work?

There are two main ways that renting a chair in a hair salon can work.

The first is that the salon owner and hairdresser agree a fixed monthly payment. This could be in exchange for unlimited use of the chair or be worked out as a daily rate.

The second is to agree a split. This could be a simple 60/40 division for example, or could be complicated by something like a minimum or maximum charge. These kinds of additions can help to offer each party the right balance of risk and reward.

Each system has its own pros and cons, so make sure to consider your business needs carefully before reaching an agreement.

But whichever system you use, it’s important to ensure the terms are clear from the start.

There’s a good chance you’ll be renting a chair from someone you already know, perhaps even as a friend, and for that reason there could be a temptation to decide the arrangement informally.

But having a clear written agreement in place is in everyone’s best business interests. That way, any potential misunderstandings around your business arrangement can be cleared up easily.

Would a hairdresser be expected to sign a contract to rent a chair in a salon?

It’s important to have a service contract between yourself (the hairdresser) and the salon that you’re renting a chair in. However, it’s important that you don’t confuse this with a contract of employment.

A fixed-term contract is standard for this type of agreement, but you should also make sure that you include plans for early termination of the contract (with an agreed notice period).

Renting a chair in a college

There’s no need to restrict your search for suitable salons to the high street, as barbershops and hair salons can be found in surprising places.

One of the most widespread is colleges and other educational institutions. We spoke to Nikki Samuels, Curriculum Manager for Hair and Beauty at Abingdon & Witney College, to find out more:

"A number of colleges will have high-street quality salon facilities, so adult learners can sometimes have the opportunity to rent a chair for their business.

They'll need to advertise and market themselves, but they can use the college’s appointment booking and reception facilities.

Many of these students fit their clients and studies around busy home lives, so they appreciate the option of never having to worry about maintaining equipment or running out of products."

What are the advantages of renting a chair in a salon?

For the hairdresser, renting a chair in a hair salon can be an attractive option for many of the same reasons that self-employment. Namely, you’re likely to be able to work flexibly and you’ll keep more of the income money that your business brings in.

On top of this, working in a salon as opposed to on the move can help you to maintain a daily working schedule. It could help you to save on transport costs as well. So may also be able to work more efficiently, as you’ll no longer be losing any valuable time travelling between appointments.

Are there any downsides?

As with the advantages, many of the downsides of renting a chair in a hair salon are similar to those of self-employment on the whole.

You’ll lose the most important benefits of being an employee, such as a regular salary, holiday and sick pay, as well as any other perks that you might have in your current job.

Working in a salon rather than in your own space means there may also be limits to the amount of freedom that you have in your job. Particularly when it comes to working when you want to, charging what you decide and creating your own working environment.

Finally, while your reputation may bring in a profitable client base, if you were to move to another workplace or open your own salon, it’s likely that the owner will own the customer database. This could mean that you would almost be starting again if and when you decide to move on from that salon.

Tax and insurance considerations

As a self-employed worker, you’ll need to take care of your own tax and insurance if you rent a chair in a salon.

Accounting should not cause much of a headache since your business will be structured in a fairly straightforward way. But it could still be worth contacting an accountant to ensure you’re not overpaying tax when it comes to the end of the year.

You’ll also need to take out mobile hair and beauty insurance, which would ideally include cover for product liability and public liability.

In some cases, there can be insurance implications of your work even before your studies have finished. At Abingdon & Witney College for example, staff ‘encourage students to take out insurance if they're offering professional treatments’. So make sure to look into your hair and beauty insurance options today.

To find out more and style your own pathway to success, click here.

Small Business Insurance Hair & beauty

Last Updated: 21 Mar 2017