What is my hair or beauty salon worth? How salons are valued in Australia.
A hair or beauty salon is usually valued as a multiple of its maintainable earnings. Maintainable earnings are the profit after adding back one working owner's wage and other owner costs. The fit-out and equipment are normally part of the price, and retail product stock is added at value. What moves the price most is whether the clients belong to the salon or to the people who serve them, how settled the team is, and the lease on the shopfront.
This guide covers hairdressing and barber shops, beauty and nail salons, brow and lash studios, and day spas. They share one big question for a buyer: when the owner or a key stylist leaves, do the clients stay?
Start with maintainable earnings
Start from net profit before tax and add back one working owner's wage and super, depreciation, interest, private costs run through the business, and genuine one-off costs such as a refit repair. Add-backs explained.
Then deduct what a buyer will have to pay that you don't:
- A second working owner, or a partner who does the bookings, rosters or bookkeeping for little or no pay.
- Your own chair time beyond one role. If you run the salon and work a full column of clients, a buyer who only wants to manage will have to employ another senior stylist or therapist in your place.
What moves the price
Whose clients are they?
This is the heart of a salon valuation. Clients who book with a particular stylist often follow that person. If most of the takings come from the owner's own column, a buyer is really buying a lease and some equipment unless you stay long enough to hand those clients over. Show a buyer:
- How the takings split across the team, and how much comes from the owner.
- How many active clients visited in the last 12 months, how often they come back, and how many rebook before they leave.
- How new clients find you: walk-ins, the booking app, Google reviews, social media or referrals.
A longer, paid handover period, where you keep working while clients get to know the new owner or team, can make a real difference to the price a buyer will pay.
How the team is paid
Salons use a mix of arrangements, and a buyer will want to understand each one:
- Employees paid under the Hair and Beauty Industry Award. If part of their pay is a percentage of what they take, their total pay still has to meet the award. If it doesn't, a buyer will recalculate the wages at award rates and see a legal risk.
- Chair or room rental, where independent stylists or therapists pay rent to work from the salon. The income is steadier but smaller, and those clients belong to the renter, not the salon.
- Contractors who are really employees can mean back-pay, super and tax exposure that buyers won't want to take on.
Senior staff who are likely to stay after the sale add value. A buyer may ask to meet them before settlement, once there's a signed agreement.
The lease and the fit-out
Salons depend on their spot: foot traffic, parking and nearby shops. A buyer will want enough lease left, including options, to earn back what they pay, and will check the rent against the takings. A modern fit-out adds value; one that needs replacing will be priced into the offer.
Retail products and equipment
- Retail product stock is usually counted at handover and paid for at cost on top of the price. Out-of-date or discontinued lines are normally left out. More on stock.
- List the equipment included (chairs, basins, dryers, beds, lasers or other devices) with its age and condition, and pay out or transfer any finance at settlement.
- The booking system and client list, business name, phone number, website, social media accounts and reviews are often where new clients come from, so include them in the sale.
Some treatments, such as cosmetic lasers or skin needling, may need a licence or particular qualifications depending on your state. Buyers will check who in the team holds them.
A worked example
All figures are illustrative, made up for this example, and are not industry data.
A hair salon has four chairs. The owner works three days on the floor, and three employed stylists do the rest. One chair is rented to an independent colourist. The owner's partner does the bookkeeping at home without pay. Net profit before tax was $58,000.
| Item | Amount |
|---|---|
| Net profit before tax | $58,000 |
| + Owner's wage and super | $65,000 |
| + Depreciation (fit-out and equipment) | $7,000 |
| + Interest on equipment finance | $2,000 |
| + One-off plumbing repair to the basins | $3,000 |
| – Market wage for the partner's unpaid bookkeeping | –$9,000 |
| Maintainable earnings (PEBITDA) | $126,000 |
If buyers were paying, say, 1.3 to 1.8 times PEBITDA for a salon like this (illustrative), it would be worth about $165,000 to $225,000, including the fit-out and equipment, plus product stock at value.
Where it lands depends on the clients. If a third of the takings come from the owner's own clients, a buyer will expect some to leave, which pulls the price toward the bottom of the range, unless the owner agrees to stay on for a proper handover.
What buyers of salons will ask for
- Two to three years of profit and loss statements, plus the current year to date
- Takings by team member, and the owner's share
- Client numbers, visit frequency and rebooking figures from your booking system
- The staff list with roles, hours, pay arrangements and qualifications (no names at first)
- Any chair or room rental agreements
- The lease, including options and the current rent
- A list of equipment, with any finance, and the retail stock on hand
Selling it yourself? How to sell your business yourself in Australia. Running a retail shop? What is my retail shop worth?
What's your salon worth?
Upload your P&L, and add your lease and roster if you have them. AUS Brokers works out your maintainable earnings with the add-backs explained, applies the multiple range for salons of your size, and checks comparable salons for sale in your state. You can add a buyer-ready profile, with photos of your salon, to market it yourself.
An indicative appraisal only. AUS Brokers doesn't provide valuations, and doesn't act for buyers or sellers. Selling in Victoria? Vic Brokers can sell it for you.
Frequently asked questions
How much is a hair salon worth in Australia?
It depends mainly on its maintainable earnings: net profit plus one working owner's wage and other add-backs. That figure is multiplied by what buyers pay for salons of that size. Clients who stay with the salon rather than a particular stylist, a settled team and a good lease all push the price up.
What if most of the clients are mine?
Then a buyer will expect some of them to leave when you do, and the price reflects it. Staying on for a paid handover period, while clients get to know the new owner or team, is the most effective way to protect the value.
Does chair rental add value?
It adds steady income, but less of it, and the renters' clients belong to them rather than the salon. Buyers value it for what it reliably brings in, and will read the rental agreements.
Is my retail product stock included in the price?
Usually not. Saleable product stock is counted at handover and paid for at cost on top of the price. Out-of-date or discontinued lines are normally left out.
What do buyers check about staff pay?
That employees' total pay meets the Hair and Beauty Industry Award, including when part of it is a percentage of what they take, and that anyone treated as a contractor genuinely is one.
General information only, not financial, tax or legal advice. Figures in the worked example are illustrative.