If you’re a small business owner, you know how important it is to keep a careful eye on expenses.
But even the savviest business owners can be caught off guard by unexpected startup and operating costs.
With so much that goes into running a business — appointments, emails, marketing — it’s no wonder that a few things slip through the cracks.
For those in the salon or spa industries, these surprise expenses could include massage therapy insurance, salon owner licenses, inventory costs, or payment processing fees.
To help make sure you’re not caught off guard by any surprise expenses, we gathered up the most common unexpected costs for new spa and salon owners.
In this article, we’ll look at:
- Insurance
- Licenses & Permits
- Operating Costs
- Inventory
- Booking Software
- Credit Card Fees
Salon and Spa Insurance Costs
Insurance Costs
Whether you’re a massage therapist, hair stylist, or nail technician, you need business insurance. Let’s take a look at the different kinds of insurance you need and their average costs.
Massage Therapy Insurance
Professional Liability Insurance: Professional liability insurance covers things like “errors and omissions”, protecting you against claims of negligence, malpractice, or claims due to professional advice that lead to a client’s financial loss.
This type of insurance is crucial for any healthcare provider and definitely a necessity to run a massage business.
Average cost? $500 to $1,000 per year.
General Liability Insurance: General liability insurance covers injuries and property damages that occur to a third party. It helps cover costs like medical expenses and attorney fees.
Average cost? Most business owners pay $30 or less per month, while some business owners pay up to $100 per month.
Hair and Nail Salon Insurance
General Liability Insurance: Salon owners and nail technicians need general liability insurance as well. It protects you and your business against client injuries, property damage, and personal injuries that can happen in a salon.
Average cost? $720 per year.
Commercial Property Insurance: Commercial property insurance covers property repairs as well as loss of income due to property damage.
Average cost? $750 per year.
Professional Liability Insurance: This type of insurance protects your business against claims that your advice or salon services caused a client financial harm.
Average cost? $920 per year.
Workers Compensation Insurance: If you have employees working for you, whether they’re salon assistants, receptionists, or other nail techs, workers compensation insurance is a must-have.
It covers your employee’s lost wages and medical expenses in the event of injury.
Average cost? $450 per year / per employee
Salon Permits and Licenses
There are different licenses and permit costs depending on your industry: hair, beauty, massage therapy, nails, and so on.
Let’s break down the different licenses and permits you need to consider as a salon or spa business owner.
Business License
Before you can operate as a salon or spa, you need a business license. Every state requires a business license, and while the U.S. Small Business Administration can give you specific details on your particular state, typical licensing fees are anywhere from $50–$100.
In addition to state licensing fees, you may also have to consider county or local-based business requirements.
Retail Seller Permit
Whether you’re a hair stylist or a massage therapist, if you offer products to your clients, you need a retail seller permit.
While a retail seller permit is typically free, your state may require an up front security deposit to cover any unpaid taxes in the event that your business closes.
Again, you can check with the U.S. Small Business Administration on requirements for your state.
Certificate of Occupancy
Salons and spas have property requirements that need to be met — such as water installation and treatment of chemicals — in order to set up shop. That’s where a Certificate of Occupancy comes in.
A Certificate of Occupancy certifies that your space, the literal salon or spa building, is compliant with the requirements for your business. It runs you anywhere from $20–$80 depending on the size of your property.
Bonus: Don’t miss our free pro guide to massage certification and licenses!
Operating Costs
Hair Salon Operating Costs
There’s no hiding that starting your own salon comes with some up front costs, such as equipment and furniture.
Here are some common expenses to keep in mind, as well as typical prices for each expense.
Equipment List:
- Combs and brushes ($100)
- Scissors/shears ($150)
- Electronic styling and grooming equipment ($300)
- Salon chairs ($750)
- Shampoo station/backwash unit ($800)
- Hood dryer ($600)
Spa Operating Costs
A lot goes into setting up and operating a successful massage therapy business or nail spa, so we put together a checklist of the most common items needed and typical costs.
Equipment List:
- Massage bed ($300–$1000)
- Candles ($15-$60)
- Facial machinery ($500–$3000)
- Sanitizer unit ($100–$300)
- Hot towel unit ($80 – $200)
- Massage oil ($19 – $60)
- Blankets ($70 – $160)
- Sheets ($40 – $60 per pack)
- Pillows ($40 – $70 per pack)
- Facial steamers ($150 – $1,000)
- Body mud ($50 – $150)
- Nail polish supply ($120)
- Nail art brushes ($20 – $50 per set)
- Herbs ($100 – $150)
- Lotions ($20 – $50 per bottle)
- Face masks ($20 – $60 per set)
- Wax ($150 – $200 per pack)
- Wax warmer ($80 – $250)
- Wax applicator ($80 – $130)
- Body salt ($60 – $150)
Small Business Payment Processing
Collecting quietly in the background, credit card fees often sneak up on small business owners.
Those little per-transaction percentages definitely add up, so it’s smart to make sure you’re using a payment processor that fits your business needs and one that saves you money.
Plan for the Costs You Don’t See Coming
Starting and running a salon or spa isn’t just about perfecting your craft — it’s about understanding the full financial picture behind the scenes. From insurance and licenses to equipment, software, and payment processing fees, these costs can add up quickly if you’re not prepared.
The good news? None of these expenses are deal-breakers when you know they’re coming. Planning ahead, budgeting realistically, and choosing tools that streamline operations can help you avoid surprise hits to your cash flow — and keep your focus where it belongs: growing your business and taking care of your clients.
A little foresight now can save you a lot of stress (and money) later.