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Financing Your Beauty Salon, Spa, Or Barbershop In 2023? Here’s ‘Your Everything You Need To Know’ Guide!

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Whether you’re the proud owner of an established salon or you’re formulating a plan to open a brand-new spa or launch a product line, you’re going to need money. And unless you’ve recently inherited a boatload of cash or started harvesting bills from your money tree, you’ll need a strategy for securing financing.

Owning and operating a hair salon or day spa isn’t cheap. You have your ongoing expenses like payroll, maintenance, inventory stocking, rent, and more. But what you don’t know are the upfront costs like construction, equipment, and supplies that you’ll encounter when you go deeper with the idea.

It takes money to make money, but fortunately, you have financing options.

Below, we’ll show you the best ways to finance your business and how to secure the capital you need (before you need it).

What’s the best way to finance your salon or spa?

Securing top-notch financing can be challenging. Should you get a bank loan or look for an investor? Is it better to bootstrap your business or ask friends and family for help?

Each financing technique has its pros and cons, so look through each of your options to identify which works best for you:

Family and friends

Getting a loan (or free money) from family and friends is cheap and straightforward. There’s usually zero interest and lenient terms.

However, not everyone has a rich network—and there’s no guarantee that your loved ones will be willing to gamble their cash on your spa-owning dreams.

Plus, mixing business and personal life can get messy. Make a poor business decision, and you risk damaging your relationships forever.

If you’re desperate for financing, consider tapping into your family and friends. Just remember to get a contract in place to preemptively avoid any issues. But if you qualify for other options, inspect those capital sources first.

Borrow money from friends for financing your salon, spa or barbershop
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Bootstrapping is when you build your business using personal savings and revenue from initial sales. It’s a slow way to start, but it’s generally more risk-free.

Bootstrapping entices many business owners because it’s simple and unintimidating, but it’s a tough path for salon and spa owners.

Without adequate financing from the get-go, it’s hard to gain traction. You may be stuck with slow growth and even low-quality employees and products—and that’s a risky combination when you’re shooting for business success.

If you have all the time in the world and aren’t in a hurry to start turning a profit, bootstrapping can be an option. However, if you want to jumpstart your business and pave a smoother road to success, consider other financing options first.


Crowdfunding is when you gather tiny amounts of capital from a large body of people to finance your new business idea. You’ve probably heard of startups raising eye-raising quantities of cash on crowdfunding sites like Kickstarter, GoFundMe, and Indiegogo.

However, unless you’re an anomaly (like the guy who raised $55,492 for a not-so-revolutionary potato salad recipe), you’re going to need a downright brilliant idea to attract backers. The crowdfunding space is a crowded one, and only innovative solutions catch the public’s eye.

If your salon or spa is bringing a new, game-changing product or solution to the market, you could gain traction on a crowdfunding platform. If not, then you’ll probably want to look at other financing options.

Equity financing

Most business owners dream about securing financing from investors or angels. It’s often viewed as free money to build your business.

First and foremost, the chances of you getting an equity investment as a small business—or any business for that matter—is slim to none. That’s because, investors are looking for a company positioned to be the next “unicorn”, specifically tech companies that can scale fast and come with the potential of high returns.

Additionally, equity financing is almost always the most expensive form of funding in the long run.

A loan gets paid off, but equity costs you a portion of your business forever.

While it might be tempting to trade ownership of your business for capital, that ownership could become much more valuable if you’re successful—and being successful is the ultimate goal, right?

If you want to retain ownership of your business and secure reliable financing, you’re better off looking at a small business loan.

Small business loan

Whether you need to finance your store, purchase necessary equipment, or fund an emergency, a small business loan has you covered.

It’s a tried-and-true method of growing a business. Yes, a loan usually comes with interest and recurring monthly payment, but you eventually pay off that debt (unlike with equity financing).

When it comes to financing a salon or spa, a small business loan usually makes the most sense. You have several loan options to help you cover just about every imaginable financial situation and business scenario.

First, let’s help you anticipate your upcoming financing needs. Then, we’ll walk you through your loan options.

A bank loan can help with financing your business
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How to anticipate your 2023 financing needs

Whether 2023 looks bleak and scary or hopeful and cheery, you’ll need financing to make the most of it.

The most expensive loans are quick loans, so it’s best to get ahead of the curve and anticipate your cash needs well in advance. Here are a few things to keep in mind when planning your finances for next year:

Cash flow forecasts

Use your historical sales and expense data to make accurate predictions about the future. It’s good to get a ballpark figure for what your cash flow will look like throughout the year. When are your sales lowest? When are your costs highest? These are the periods you’ll likely need additional financing to cover.

Seasonal demand

Spas and salons go through lulls and peak seasons just like everyone else. Black Friday is usually a hit, and a new year often marks a “new you” for people who aim for better self-care. Make sure you have the financing you need to cover these spells. When business is booming, will you have the cash to hire extra help? And when you enter the slow season, how will you keep the product stocked?


Your goals for your salon or spa will dictate how much financing you need. If you’re content to safely ride out 2023, then you may only need minimal financing. However, if you want to capitalize on the situation and position your business at the top, it’ll require extra capital. Consider what you want for next year (and the years to come) when analyzing your financing needs.


Every year is different. You may anticipate a boom in sales next year, but a bump in expenses could keep your business rooted to the floor. For example, if you anticipate needing to renovate your store, upgrade equipment, switch products, or replace staff, you may need extra cash to balance your budget.

6 best loans for salons, spas, and barbershops

Different loans serve different purposes. You have a variety of loans to choose from depending on your situation and use case.

Here are the most common (and practical) types of business loans for salons and spas:

Business line of credit

A business line of credit can solve most cash flow issues. It’s a safety net that expands your working capital, but you’re under no obligation to use it.

Secure a line of credit in advance to keep in your back pocket, just in case you ever have an emergency or gaps in your cash flow. A business line of credit is revolving, so you get access to the funds again as soon you payback the portion you’ve used—no need to reapply.

Plus, you only pay interest on the funds you use—not the entirety of your line of credit.

You can use a line of credit on practically anything your salon or spa needs. Whether you need to restock inventory, replace broken equipment, or pay this month’s wages, a business line of credit has you covered.

Merchant cash advance

Use tomorrow’s earnings to finance today’s expenses. If your salon or spa consistently reports strong sales, you can qualify for a merchant cash advance.

A merchant cash advance gets you a lump sum of cash now that you’ll payback using a portion of your future daily sales. This is a great financing option during a seasonal lull when expenses are piling up, but you know sales are right around the corner.

Merchant cash advances aren’t the cheapest financing option, but they’re great if you have new or poor business credit.

Commercial mortgage

Unless you’re a traveling salon-on-wheels beauty service, you’re going to need a roof over your business’s head. Rent and payroll are typically every business’s most expensive costs, and it’s no different for a salon or spa.

A commercial mortgage can help free up your cash flow by giving you extra capital to buy, rent, renovate, or even expand your business location.

Want to relocate to a hotter part of town? Or need to renovate your property to accommodate more customers and expanded services? A commercial mortgage can make it happen.

SBA loan

While SBA loans are notorious for long applications and mountains of paperwork, they’re also well known for low rates, high loan amounts, and generous payback periods.

SBA loans are backed by the Small Business Administration, lowering the risk for lenders and increasing your chances of securing top-notch financing. The SBA doesn’t do the lending—they just work with lenders to provide a bit of insurance if your business defaults on a loan.

SBA 7(a) loans and microloans are great tools for financing your spa or salon, but they’re also extremely competitive. If your credit is in a good place and you’ve got time to spare, consider an SBA (Small Business Administration) loan.

Business credit card

A business credit card works pretty much exactly like your personal credit card. You swipe now, pay later.

Use your business card to pay for any business-related cost, whether that’s restocking your shelves or covering payroll for the month.

Plus, you earn great rewards like cashback, travel points, and more on all your business expenses. Some cards even offer generous 0% introductory rates for 12 months or more when you get a new business card.

Business credit cards are great for new spas and salons. They extend your working capital, get you quick access to cash, and build your credit so you can score bigger, better loans down the road.

Equipment financing

You’d be surprised what you could fund with an equipment financing loan. Equipment is just about any asset that you use to facilitate business.

That means you could use equipment financing to purchase chairs, sinks, commercial hair dryers, and even point-of-sale software for your salon or spa.

These loans help prevent your cash flow from getting tied up in costly expenses. When you need to invest in new equipment, fix your assets, or replace your outdated tools, equipment financing can help.

Finance your salon, spa, or barbershop

Seeking business financing isn’t a sign of weakness—it’s a symbol of strength. You need money to make money, and there’s no shame in taking out a loan to make it happen.

Whether you need to make your spa, salon, or barbershop more COVID-friendly or want to expand your business without draining your bank account, a small business loan can help.

Analyze your financial situation, research your options, and get the financing your business needs—before you need it.

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Editor’s Note: This is a guest post by Samantha Novick who’s a senior editor at Funding Circle, specializing in small business financing. She has a bachelor’s degree from the Gallatin School of Individualized Study at New York University. Prior to Funding Circle, Samantha was a community manager at Marcus by Goldman Sachs. Her work has been featured in a number of top small business resource sites and publications.

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