Small Business Blog

Research
Your research plays a decisive role in success of your business. Study about the tanning salons, educate yourself about indoor tanning. The more you research, the more you will be aware of the risks involved in this business. Understand who are your competitors in the market, and make a list of the services and facilities that they offer. Go to the best tanning salons in other towns (tanning salons in your town won’t be helpful once they realize that you are competition), observe their functioning, and ask for their suggestions.

Money
Once you have done your research, you will have a fair idea of all the things that you need in your salon, and you will also be in a position to estimate the capital required to start the business. After estimation, if you feel like you are short of money, then you can borrow from a bank, or look for an investor. Once you are sure that you have enough money to start the business, you can go ahead.

Space
The location of your tanning salon influences the popularity of your business to a great extent. If your salon is in a prime location with ample traffic, you will surely grow at a faster rate. Look for space that is in a good location (but see that you do not end up spending a huge sum on the rent itself). See that the space is big enough, it should easily accommodate a waiting room, and a few tanning beds. Make sure that there are no problems in the power supply.

Tanning Beds
A tanning salon has no future without good tanning beds. So, see that you get the best tanning beds for your salon. You will definitely face budget restrictions here, but see that you do not compromise a lot. The cost of buying a tanning bed will vary depending on your specification, you might have to spend around $10,000 on a decent one. You can start your business with small tanning beds, and then switch over to big ones, once you are established. It is better if you have vertical and horizontal beds.

Set Up
Now, it is time for you to set up your salon. Your salon should not look congested. There should be dividers between each bed. Get all necessary furniture, along with qualified staff. Good lotions and protective eye wears, are a must. You can collaborate with lotion manufacturers, and make a good profit by selling lotions. Once you have become popular, you can also start the sale of other accessories.

Advertisement
This is very essential at the start of your business, because people do not know about your salon. Use all possible means (newspaper, billboards, television, radio, etc.) to advertise. You can also create your own website. One of the best ways to attract customers is to provide great offers in the initial phase of your business, and charge less than your competitors. Once you have a loyal customer base, you can increase your rates.

Market Failure
Market failure when a big project is not affecting everyone but only a few. A private firm would only look at profitability and related market prices to take up a deal but the government has to look at other factors. To determine the social cost in case of market failure and when market prices are unable to define them. These social costs are called as shadow prices.

Savings & Investment
Impact of the project on general savings and investment level. A project that induces more savings are investment in an economy and not the other way round.

Distribution & Redistribution of Income
The project should not lead to accumulating income in the hands of a few but, it should equally distribute the income.

Employment and Standard of Living
How a project affects employment and standard of living will be taken into account as well. The deal should lead to increase in employment and standard of living.

Externalities
Externalities are impacts of a project which can be both harmful and beneficial. Therefore, both the effects are to be assessed before sanctioning a deal. Positive-externalities could be in the form improvement in technology and negative-externalities could be in the form of increase in pollution and destruction of ecology.

Taxes and Subsidies
In a general cost benefit calculation, taxes and subsidies are considered as expenses and income respectively. Though in case of social-cost benefit analysis, taxes and subsidies are considered as transfer payments.