Taking over a hair salon: how to evaluate the clientele and subscriptions?
Introduction
The takeover of a hair salon relies on an intangible but decisive asset: the clientele. Unlike other sectors, the relationship between the hairdresser and their clients is often personal and emotional. A loyal client does not necessarily follow the salon, they sometimes follow their hairdresser.
This reality makes the evaluation particularly delicate. A salon may display stable turnover, but if 60% of the clientele is attached to an employee who does not stay after the takeover, the real value collapses. Conversely, a well-structured subscription system can guarantee predictable recurrence and facilitate the transition.
Before committing, you must understand three dimensions: the composition of the clientele (occasional vs regular), the recurrence of visits (real loyalty), and the transferability (attachment to the place or to the person). Subscriptions, increasingly common in the sector, add a layer of complexity: they can be a loyalty asset or mask fragile profitability.
This guide gives you the keys to analyse concretely the value of a hair salon and avoid unpleasant surprises. For a comprehensive financial evaluation, consult our valuation tool.
📌 Summary (TL;DR)
Taking over a hair salon requires an in-depth analysis of the clientele: composition (regular vs occasional), visit recurrence, and transferability after the seller's departure. Subscription systems can guarantee predictable loyalty, but their real profitability must be verified. Rigorous due diligence on customer data, retention rates and attachment to the place rather than to the person is essential to evaluate the real value of the salon.
📚 Table of contents
The specificities of a hair salon to evaluate
A hair salon is distinguished by specific assets that determine its value. Location plays a determining role: foot traffic, visibility, accessibility. The commercial lease represents a key element, especially in urban areas where premises are scarce.
Equipment (chairs, basins, dryers, air conditioning) loses its value quickly. This is not where the real asset lies.
The clientele represents 60 to 70% of the value of a hair salon. It is what generates recurring revenues and ensures the sustainability of the business. Subscription systems, increasingly widespread, reinforce this recurrence and directly impact the valuation.
Analysing the composition of the clientele
Before any takeover, dissect the customer base with precision. Ask the seller:
- Number of active clients: who came at least once in the last 6 to 12 months
- Average visit frequency: how many times per year each client returns
- Average basket per visit: amount spent (cut, colouring, treatments)
Distinguish regular clients (every 1-2 months) from occasional clients (2-3 times per year). The data must come from the till system or management software.
This analysis resembles that of a customer portfolio in a painting business: recurrence takes precedence over volume.
Evaluating recurrence and loyalty
Loyalty measures the solidity of your future turnover. Calculate the 12-month customer retention rate: how many clients present last year returned this year?
Identify regular clients who come every 1 to 2 months. These are the ones who ensure the salon's stability. Analyse the average seniority of relationships: clients who have been loyal for 5 years are a valuable asset.
Critical point: verify whether loyalty is linked to the salon or to the hairdresser personally. If clients follow "their" hairdresser and not the salon, the risk of loss is major in case of departure of the key employee.
Subscription systems: opportunity or trap?
Subscription models are developing in hairdressing: monthly packages, prepaid cards, unlimited cuts. They promise predictable revenues and better loyalty.
But beware: a poorly calibrated subscription can become a financial trap. The real profitability must be analysed before taking over a salon that relies on this model. The following two sections guide you in this evaluation.
Understanding the different types of subscriptions
Common models include:
- Unlimited monthly subscriptions: unlimited cuts for a fixed package
- Annual packages: X cuts per year at reduced rate
- Prepaid cards: credit to use over several visits
Advantages for the salon: predictable revenues, anticipated cash flow, reinforced loyalty. The principles are similar to subscription strategies in e-commerce: recurrence increases the value of the business.
Verifying the real profitability of subscriptions
Do not take subscriptions at face value. Ask the seller:
- Number of active subscribers and evolution over 12 months
- Average usage rate: how many actually come vs how many pay
- Average subscription duration and monthly cancellation rate
- Profitability per subscriber: revenues vs real costs (time, products)
Calculate whether the model is profitable or if it cannibalises margins. Beware of under-priced subscriptions that create dependency without profitability. A subscription at 50 CHF/month for unlimited cuts can be loss-making if the client comes every week.
Measuring the transferability of the clientele
Essential question: will the clients stay after your takeover? The answer depends on several factors:
- Presence of the main hairdresser: are they staying or leaving?
- Reputation of the salon vs personal reputation: do clients come for the place or for a person?
- Quality of the client-salon relationship: atmosphere, welcome, overall experience
Require a clear transition plan: support period, introduction to regular clients, communication about the change. Verify the non-compete clauses in employee contracts. A hairdresser who opens their salon 200 metres away will take part of the clientele.
Practical checklist for your due diligence
Documents and information to request from the seller:
- Till software extracts: minimum last 3 years
- Anonymised client list with visit frequency and average basket
- Details of active subscriptions: number, type, usage rate
- Annual retention rate: how many clients return from one year to the next
- Team structure: seniority, skills, intentions to stay
- Employment contracts and non-compete clauses
- Commercial lease conditions: duration, rent, charges
Leez allows you to structure these exchanges in complete confidentiality via its platform. To estimate the overall value of the salon, use the Leez valuation tool.
Taking over a hair salon relies on a rigorous analysis of its clientele. The composition of the customer portfolio, the recurrence rate, measurable loyalty and real transferability are the four pillars of your evaluation. Subscription systems can represent a major asset, provided you verify their effective profitability and their sustainability after the transfer.
Take the time to examine the figures: visit frequency, average basket, retention rate, and especially the share of clientele attached to the salon rather than to a specific hairdresser. A structured due diligence protects you against unpleasant surprises and allows you to negotiate a fair price.
Are you considering taking over a hair salon or another service business? Explore the companies available on Leez and access verified information to make your decision with complete transparency. Our network of experts can support you in the evaluation and negotiation.
