Nail Salons

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 30,300 nail salons in the US provide nail care services, such as manicures, pedicures, and nail extensions. Manicures and pedicures account for over 85% of industry sales. Nail salons may also offer skin care, hair removal, or other spa-related services. Specialty services include waxing, eyebrow shaping, massage, wraps, reflexology, and eyelash services. Nail technicians may be employees or may rent booth space from the salon and act as independent operators.

Competition From Alternative Service Providers

Nail salons face competition from a variety of alternative service providers, including full-service beauty salons, spas, and clients themselves.

Health Risks For Workers

Nail care services expose workers to chemicals from polishes, removers, and glues, such as formaldehyde, toluene, and methacrylate compounds.

Industry size & Structure

The average nail salon operates out of a single location, employs 3-4 workers, and generates around $208,000 annually.

    • The US government reports over 30,300 firms that employ 124,000 workers and generate $6.3 billion in annual revenue.
    • Non-employer statistics, which cover the self-employed and businesses with no paid employees, report over 252,200 establishments and over $5.5 billion in annual sales. Non-employer statistics cover nail technicians who rent booth space from individual establishments and act as independent operators.
    • The industry is highly fragmented; the top 50 companies account for less than 3% of industry revenue.
    • The nail salon industry includes small chains, franchises, and independent operators. With 900 locations, Regal Nails is the largest franchise in the US and operates locations in Walmart stores.
    • Many business owners are immigrants. Vietnamese and Vietnamese-American owned salons dominate the industry, although Korean immigrants have established a stronghold in New York City. Vietnamese-owned salons account for about half of the industry.
                            Industry Forecast
                            Nail Salons Industry Growth
                            Source: Vertical IQ and Inforum

                            Recent Developments

                            Mar 26, 2024 - Spending, Wages Up
                            • Employment by the nail salons industry reached its highest level in Q2 2023 before trending lower in Q3 and Q4, according to the Bureau of Labor Statistics (BLS). Employment costs at hair, nail, and skin care services rose 6% in December 2023 compared to a year ago, reaching $24.29. Average hourly wages have grown more than 40% since 2019. Additionally, US consumer spending increased modestly in 2023, with budget-conscious shoppers being more selective with their purchases, according to the Bureau of Economic Analysis.
                            • Inflation was reported as the top business problem for small business owners, selected by 23% of owners in a survey by the National Federation of Independent Business (NFIB). The NFIB’s Small Business Optimism Index fell in February 2024 to 89.4, marking the 26th consecutive month below the 50-year average of 98. According to NFIB Chief Economist Bill Dunkelberg, “While inflation pressures have eased since peaking in 2021, small business owners are still managing the elevated costs of higher prices and interest rates. The labor market has also eased slightly as small business owners are having an easier time attracting and retaining employees.” Small business owners are still encountering high job opening levels, with a seasonally adjusted 37% of owners reporting job openings they could not fill in the current period. Nearly 55% of owners reported making capital outlays in the past six months, with 35% spending on new equipment, 23% acquiring vehicles, and 15% improving or expanding facilities.
                            • A new beauty trends report from Fresha shows that over half of Gen X (54%), Gen Z (52%), and Millennials (51%) view beauty and wellness services as an essential part of their life, according to Nailpro. In comparison, only 37% of Baby Boomers view beauty and wellness services as essential, with 57% seeing the services as an indulgent treat. Appointments are also getting longer, which is a plus for younger generations. About 70% of appointments in 2023 were between 30 to 90 minutes, which is an increase of 18% since 2018. Millennials (60%) and Gen Z (58%) said they don’t mind spending longer in the beauty chair. Fresha CMO Steve Rodgers noted, “The beauty and wellness experience allows consumers to switch off from social media, work emails and phone calls and completely focus on prioritizing themselves.”
                            • Nail salons will have to monitor minimum wage changes, as 22 states increased their minimum wages in January 2024, according to USA Today. About half of the increases are automatic adjustments linked to inflation. States that raised their minimum wages in January 2024 include Hawaii ($14), Maryland ($15), Nebraska ($12), and Washington ($16.28). Several states are set to boost their minimum wage levels later this year, including Florida (up to $13 in September) and Nevada (up to $12 in July). According to the Economic Policy Institute, nearly 40 US cities and counties will increase their minimum wage rates above state levels at the start of the new year. The federal minimum wage is $7.25 an hour, and more than 20 states, primarily located in the South and the Midwest, use the federal minimum as their wage floor.
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