New Tanning Salons Renting Sunbeds
When starting a new tanning salon, there are a lot of expenses involved. The businesses will need to find their location, get all their equipment, and ensure that there is enough cash to cover their operating expenses. With all the excitement involved in starting a new business, it can be easy to look at the first two points and not the last one. By not paying attention to how much cash is available, businesses run out of funds due to a slow start-up phase before a client base is established.
Good financial management is key to setting up a new business, including a tanning salon. One way good cash-flow can be maintained is by determining how much capital is available and then by allocating portions to initial investment and portions to daily operations until profitability is established. As soon as the business starts breaking-even, and ultimately making profits, they will be able to cover their operating expenses without needing additional capital. This isn’t always easy and can take an unknown amount of time, it is better to be prepared than to be unable to pay your employees after two months.
Once the capital has been split between these two areas, the business can better manage how much it is they can spend on initial investment. For a tanning salon, the most important equipment is the sunbeds. There are various ways that a new business can purchase these sunbeds, but this is the driving force of the business a certain standard has to be maintained. New businesses often overspend in this area.
One way that a new tanning salon can prevent this, is by renting their sunbeds instead of purchasing them. This will ensure you have the necessary cash-flow available. Instead of having to spend thousands of dollars on new/ second-hand equipment, bestsunbeds.co.uk sunbed rentals can be a good way to ensure the business model works before over-investing. Once the business is established, then capital can be raised to purchase new equipment, but until then there is no need.
Generally, people try to stay away from renting because it is more expensive in the long run than buying. This is true, but it won’t help to save a few thousand dollars if the business closes due to cash-flow problems after 6 months. When it comes to tanning salons, it can be very difficult to start-up, especially if Summer runs longer than usual. The cash-flow may start drying out before the Winter months arrive and selling second-hand sunbeds is not easy, resulting in them usually being sold far below market value.
The difference between renting and purchasing will be based on each business individually. If there is enough capital available and there is confidence that profitability levels will be reached, then it won’t be a bad decision. But, it is difficult to predict these things to 100% certainty, so instead of taking the risk, small businesses should strongly consider renting expensive equipment instead of using up all their capital.