Nail Salons Business Strategy

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Table of Contents

Strategy for a Business Concept
Rationale for Purchasing Business
The Appropriate Form of Ownership
A Business Plan for the Business
Conclusion
References

Nail salons are small businesses that can be observed in many towns and large cities. La Belle Nail Salon is one of small salons that mainly specialize in providing such services as manicure, pedicure, nail art, nail enhancement, and nail extension. The target audience of La Belle Nail Salon is females aged between 18 and 50. In order to stay competitive within the actively developing industry of nail and hand care services, nail salons should focus on improving their strategies in order to attract more clients and increase the customer loyalty. The strong competition is more obvious in large cities, where the number of nail salons is great and the provided services are various in their kind and quality. The aim of this paper is to create a working business strategy for a competitor to La Belle Nail Salon in the market and to propose a business plan for a new nail salon.

Strategy for a Business Concept

The process of selecting a strategy for a new business is one of the most challenging tasks for an entrepreneur because it is necessary to choose a strategy that can be effective to create the competitive advantage for the business. Thus, an entrepreneur usually chooses among differentiation, low cost, and focused strategies oriented to developing and accentuating different aspects of the business to contribute to the competitive advantage (Blackburn, Hart, & Wainwright, 2013, p. 9; Scarborough & Zimmerer, 2012, p. 57). For starting such a small business as a nail salon, it is relevant to choose the differentiation strategy based on the concept of service (Scarborough & Zimmerer, 2012, p. 58). Differentiation according to the factor of service means that the new nail salon has the mission to provide superior and high-quality customer services while responding to the customers needs, interests, and expectations. According to the differentiation strategy, it is expected that the nail salon will be organized and designed as a sitting-room in a mansion where clients can not only improve the state of their nails but also discuss latest news, drink a cup of tea, eat a cake, listen to music, and look through magazines. In spite of the fact that many of these activities are typical for salons providing different types of services for women, the new nail salon will emphasize the unique atmosphere of the fashionable spa-salon designed as the saloon of the 19^th century that is located in the centre of a city. The focus on the customer will be reflected not only in the quality of the provided nail services but also in the attention from waitresses and assistants. Furthermore, the rules of the nail salon can be associated with the rules of the fashionable club or saloon of the 19^th century.

The discussed differentiation strategy based on the aspect of the reliable various services can be referred to as an effective business strategy that can be used in the competitive market of spa and cosmetics salons. The focus on the customer service is selected because of the lack of financial resources to propose customers the innovative approaches in the sphere of nail art, extension, and enhancement. The competition in the industry is high, and it is possible to choose the opposite path and provide clients with the services that are associated with the certain atmosphere and leisure activities that can be discussed as trendy (Cronin-Gilmore, 2012, p. 97). In this case, an entrepreneur uses the available financial and material resources to create the specific atmosphere, there is no need to focus on innovation, and the uniqueness of the customer service can be achieved through providing exclusive experience while using only the basic equipment and known technologies.

Rationale for Purchasing Business

In spite of the fact that the new business can become an efficient competitor to La Belle Nail Salon, it is more relevant to purchase the existing business and use the selected strategy in order to improve the tactical approach currently followed in the salon. The reason is that the strategy followed in La Belle Nail Salon is based on the idea of high quality, but it does not contribute to increasing the business competitive advantage. However, instead of the direct competition, it is more profitable to purchase the existing business because its location is known for the public, the clients are permanent, and the reputation associated with the provision of high-quality services works to attract more customers (Scarborough & Zimmerer, 2012, p. 128). Furthermore, it is possible to use the previously developed relationships with suppliers in the industry and avoid the staff recruitment procedures while inviting the employees who worked for the former owner of the business (Ensign, 2008, p. 26). It is possible to state that the staff of La Belle Nail Salon is competent, and it is important for the entrepreneur to address the needs and interests of the staff while following the human resource strategies that were used by the former owner. The process of changing the human resource management approaches should be slow and based on the ideas of the customer service and job commitment.

From this point, the total costs of purchasing La Belle Nail Salon are expected to be lower than the costs associated with opening a new business. Thus, the process of opening a new nail salon can be time-consuming and costly because of the necessity of starting the business from the zero point (Scarborough & Zimmerer, 2012, p. 128). Several stages of the business development process can be avoided with references to purchasing La Belle Nail Salon. As a result, a new entrepreneur will avoid risks associated with the start-up stage and save significant financial and material resources, while developing relations with the existing staff, suppliers, and customers.

The Appropriate Form of Ownership

It is possible to state that the sole proprietorship is the most appropriate form of ownership to start the small business, without focusing on the business as the new one or as the purchased one. An entrepreneur can see many advantages in operating such a small business as the nail salon as an individual. In this case, fewer resources are necessary to develop the business and organize it from the legal perspective. Furthermore, a nail salon is a typical small business, and it is relevant to refer to the sole proprietorship while focusing on the analysis of potential profits (Scarborough & Zimmerer, 2012, p. 70). The sole proprietorship is also selected because partnerships and corporations are not efficient for businesses that are only at the starting point of their development. In order to save resources, it is reasonable to choose the sole proprietorship associated with appropriate fees and costs.

A Business Plan for the Business

A business plan for the new nail salon should include the following sections: Executive Summary, Mission and Vision Statements, Business History and Goals, Industry Profile, Business Services, Business Strategy, Marketing Strategy, Analysis of Competition, Management and Organization, and Financial Statement.

Executive Summary

Luxury Nail Bar is a fashionable nail salon located in the central part of Boston, Massachusetts. The nail salon specializes in making different types of manicure and pedicure as well as other nail and hand care services. In addition, the nail salon is organized as a spa club and saloon for permanent female clients.

Mission and Vision Statements

Luxury Nail Bars mission is to provide the exclusive nail services for the female population while addressing their needs in the aesthetic satisfaction.

Luxury Nail Bars vision is to foster beauty and care in the sphere of nail art and services.

Business History and Goals

Luxury Nail Bar was established in 2015 as a small nail salon providing high-quality services to female customers in Boston, Massachusetts.

The goal of the business is to develop the profitable entrepreneurship in the sphere of beauty and care with the potential for the further expansion in five years.

Industry Profile

There are more than 205,000 nail salons in the United States with references to the data on 2010-2012 (Statistics on Nail Salons in the USA, 2013). The number of salons tends to increase because of the high demand for the provided services. Many nail salons use different innovative technologies in order to increase the quality of the provided services and propose new kinds of services.

Business Services

Manicure.
Pedicure.
Nail art.
Nail enhancement.
Nail extension.
Hand care services.

Business Strategy

Differentiation based on the idea of the customer service. The focus is on provision of the high-quality services in the customer-focused environment. Much attention is paid not only to the provision of the nail services but also to organizing the clients leisure and waiting time.

Marketing Strategy

The main focus is on distribution of flyers providing the information about Luxury Nail Bar and discounts.

Analysis of Competition

The market is highly competitive. The risk of new entrants is high because of the comparably low costs associated with starting a business.

Management and Organization

The sole proprietorship, two management positions, 15 employees.

Financial Statement

The business will start basing on a loan. A repayment schedule is expected to be developed for 24 months.

Conclusion

The decision on starting or developing a small business depends on the analysis of the industrys environment, on the discussion of the market trends, and on the analysis of the competitors advantages and disadvantages. The success of the business depends on the effectiveness of a selected strategy. Having analyzed an industry in which such small businesses as nail salons operate, it is possible to state that the differentiation strategy is the most effective choice for starting a business in the highly competitive environment. The sole proprietorship and the path of purchasing a business are chosen for Luxury Nail Bar in order to compete within the market while referring to the minimal starting capital. An outline of the business plan reflects the main points need to be addressed in the document.

References

Blackburn, R., Hart, M., & Wainwright, T. (2013). Small business performance: Business, strategy and owner-manager characteristics. Journal of Small Business and Enterprise Development, 20(1), 8-27.

Cronin-Gilmore, J. (2012). Exploring marketing strategies in small businesses. Journal of Marketing Development and Competitiveness, 6(1), 96-104.

Ensign, P. (2008). Small business strategy as a dynamic process: Concepts, controversies, and implications. Journal of Business & Entrepreneurship, 20(2), 25-43.

Scarborough, N. M., & Zimmerer, T. W. (2012). Effective small business management: An entrepreneurial approach. Upper Saddle River, NJ: Prentice Hall/ Pearson.

Statistics on Nail Salons in the USA. (2013). Web.

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