How do you get a business loan for a salon?

How salon revenue models shape underwriting

Salons operate under two fundamentally different revenue structures, and lenders underwrite them differently. Commission-based salons collect all service revenue and pay stylists a percentage — bank deposits reflect total gross revenue, giving lenders a clean picture of the business's throughput. Booth-rental salons charge stylists a fixed weekly or monthly booth fee — the owner's deposits are only the rental income, not the underlying service volume. For a booth-rental operator, monthly deposits may appear low relative to the actual economic activity in the salon. Documenting booth-rental agreements and booth count alongside bank statements helps lenders size working capital correctly. Both models fall under NAICS 8121 (Personal Care Services).

Equipment and chair financing

Salon chairs, styling stations, shampoo bowls, color processing equipment, and point-of-sale systems are financed as equipment loans — asset-secured term loans typically ranging 36–72 months. The equipment serves as collateral, reducing the credit bar relative to unsecured working capital. IRS Publication 946 Section 179 allows first-year expensing of qualifying salon equipment up to the annual limit — plan purchases before December 31 to capture the deduction in the current tax year. New stations and shampoo bowls typically run $800–$3,000 per unit; a 10-station salon buildout can require $30,000–$80,000 in equipment capital.

SBA 7(a) for salon buildouts and acquisitions

Opening a new salon location or acquiring an existing one often requires $100,000–$500,000+ across leasehold improvements, equipment, and working capital — a scale that suits SBA 7(a) loans. SBA 7(a) funds up to $5 million with 10-year terms for working capital and equipment and up to 25-year terms when real estate is included. For salon acquisitions, the seller's tax returns and appointment-book utilization rates are the underwriting anchors. The SBA's goodwill-inclusion policy means a salon's established clientele and stylist roster can be included in the appraised value of the loan collateral — a significant advantage for acquisition financing.

Working-capital lines for product inventory

Color, treatment products, retail inventory, and seasonal launch stock require capital that can fluctuate month to month. A revolving prime-rate-indexed working-capital line of credit lets you draw when inventory needs spike and pay down as revenue clears. Lines for established salons typically size at 10–15% of annual revenue.

Qualification benchmarks for salons

For non-SBA working capital products, lenders typically look for 6+ months in business, $10,000+ in monthly business deposits, and owner FICO 550+. Commission-based salons can submit 3 months of bank statements showing consistent deposit frequency. Booth-rental operators should supplement with booth-rental agreements showing contracted monthly income. For SBA 7(a), expect 2+ years of profitability in tax returns and 680+ personal FICO. Apply at Find my match — your file routes to the funding partners best matched to it.