Your success as a cosmetologist depends a lot on your ability to practice your craft in a supportive environment you love, where you feel good about yourself, and where you get recognized for your uniqueness and talents. That’s kind of what working in a salon is all about, right?

You’re giving a little bit of yourself to each client you see. You owe it to yourself to set up your business in a way that works for you.

For most cosmetologists, this means either working for commission or renting a chair. Both of these options give you the opportunity to attract new clients while providing you with access to professional facilities and an environment with a little ambiance.

Depending on your financial status, your work style, your professional goals, and your experience in the industry, you may find one works better for you than another.

Before you begin the search for your first (or next) cosmetology job, take some time to think about whether working as a commissioned employee or renting a booth from a salon owner makes the most sense for you.

Make the right decision and you’ll feel good right out of the gate; make the wrong decision, and – well lucky you – you still have another option to fall back on. Freedom and options: that’s the beauty of being a cosmetologist.

Here’s what you’ll want to know …

Renting a Salon Suite

Renting a Salon Suite involves entering into a tenant/landlord situation. It’s no different that renting an office in an office building or an apartment in an apartment building. In this case, the salon owner leases out workstations and booths to independent stylists in exchange for a monthly rent.

When you enter into this type of arrangement, you essentially own your own cosmetology business. The only thing you don’t own is the space you are renting. This means the salon owner does not operate as your employer and, in turn, you are not under any obligation to run your business according to the salon owner’s wishes (with a few exceptions). In the eyes of the state and the federal government, you are a self-employed independent contractor.

Stylists in this type of situation must pay a monthly rental fee to the salon owner in exchange for salon space—usually a vanity, mirror, and hydraulic salon chair—and the use of utilities. The salon will also likely allow you to use hood dryers, shampoo bowls, towels, and a reception area.

Otherwise, you are in charge of supplying everything else needed to run your business. This includes all your tools, supplies, and styling products. Many stylists working as independent contractors also choose to sell the styling products they carry. This can provide a nice little bit of income on the side that can really add up at the end of the month.

The Pros

• You are your own boss. No one dictates your schedule or tells you how much to charge your clients. Your schedule accommodates you – not a salon manager.
• You have greater flexibility and independence regarding your career trajectory.
• You can use your favorite styling products.
• After paying your salon rental fee, all the money you earn is yours.

The Cons

• You must pay your own benefits (health insurance, disability insurance, life insurance, etc.).
• You must purchase all of the tools, implement, and products you use.
• You must market and network yourself to earn new business.
• You must hold a state sales tax license and collect sales tax on your services and retail sales.
• You must keep your own accounting and clientele records and ensure you keep accurate business records of all income and expenses.
• You must pay your own state and federal taxes.

The Verdict

The experienced cosmetologist with a strong clientele base has the best chance of success in a booth rental scenario. It’s a lot easier to set up and run your own business if you have a list of clients who will keep you afloat.

You may also be an ideal independent stylist if you have a strong work ethic, a great deal of self-discipline, and the ability to handle the related administrative and marketing tasks. Independent contractors must be able to juggle their stylist duties, along with all of the necessary tasks involved with running a business.

Many cosmetologists use this type of setting as a precursor to opening and operating their own salon. It provides them with a glimpse into what to expect as a salon owner, thus preparing them to make the move to salon ownership.

Working on Commission

A commission-based cosmetology job allows you to work as an employee of a salon. Just like any other type of job, your employer will provide you with a schedule. You can expect to be paid a wage, along with a commission, or a straight commission.

As a commissioned employee, you can expect to keep a percentage of the income you bring into the salon through the services you perform. You can expect most salons to offer you a commission of about 50 percent of the total revenue you generate for the business. Your employer may also offer you a percentage of the total retail products you sell – usually about 10 to 15 percent.

The Pros

• You don’t have to worry about running a business – you can focus solely on your craft.
• You have the support and knowledge of a salon behind you as you grow your clientele base.
• The salon handles the marketing of the business, so you don’t have to deal with the constant pressure of bringing in new clients.
• As you gain a larger client base, you can negotiate a better commission structure with the salon.
• You may enjoy a number of employee benefits, such as vacation time, health insurance, and sick pay.

The Cons

• You must charge the prices set by the salon for your services.
• Your schedule and hours are dictated by the salon owner/manager.
• You must use the retail products the salon sells.

The Verdict

A commission-based structure is undoubtedly the best for beginner stylists who benefit from a steady influx of new clients. The collaborative, team environment is helpful for many stylists, as it provides them with the support needed to mature as a stylist.