How Much Does It Cost to Start a Hair Salon / Barbershop in Minnesota?
Minnesota has a cost index of 0.92x the national average for hair salon / barbershop businesses. Here is a complete line-by-line cost breakdown based on local data.
Line-Item Cost Breakdown
| Category | Low | Mid | High | Notes |
|---|---|---|---|---|
| LLC filing | $276 | $920 | $1,840 | LLC filing fee in Minnesota: $155. LLC fee varies by state ($35-$500). EIN is free. |
| Cosmetology/barber license | $460 | $2,300 | $4,600 | Cosmetology license $50-$300 per stylist. Salon establishment license $100-$500. Health inspection $50-$300. Each stylist must have individual state license. |
| Styling chairs | $4,600 | $18,400 | $55,200 | Hydraulic chairs $500-$3,000 each. Wash stations $500-$2,000 each. Mirrors $200-$800 each. Professional clipper sets $150-$400. Scissors $200-$800 per set. For a 4-chair salon: chairs alone $2,000-$12,000. |
| Plumbing for wash stations | $4,600 | $27,600 | $92,000 | Specialized plumbing for wash stations $5,000-$15,000. Electrical for dryers and equipment $2,000-$5,000. Flooring $3,000-$8,000. Full buildout $30-$100/sqft. |
| Hair care products | $1,380 | $4,140 | $11,040 | Professional product lines for backbar $800-$2,000. Retail inventory $500-$5,000. Coloring supplies $500-$2,000. Consumables (capes, towels, sanitizer) $500-$1,500. |
| Reception desk | $1,840 | $5,520 | $13,800 | Reception desk $500-$2,000. Waiting chairs $200-$800. Display shelving $300-$1,500. |
| General liability | $1,380 | $3,220 | $6,440 | Annual cost. General liability $400-$1,200/yr. Professional liability (for chemical treatments, allergic reactions) $300-$800/yr. Workers comp varies by state. |
| Exterior signage | $1,380 | $3,680 | $9,200 | Exterior sign $1,000-$5,000. Website with booking $500-$2,000. Grand opening marketing $500-$2,000. |
| POS system | $460 | $1,380 | $3,680 | Salon booking software (Square Appointments, Vagaro) $0-$150/mo. POS hardware $300-$1,200. |
| 3 months operating expenses | $7,360 | $23,000 | $55,200 | Monthly operating: rent $1,500-$5,000, staff costs $2,000-$10,000, utilities $300-$800, supplies $300-$800. |
| Estimated Total | $23,000 | $92,000 | $276,000 | Adjusted for Minnesota's cost index (0.92x national avg) |
LLC Registration in Minnesota
To form an LLC in Minnesota, you file Articles of Organization (or Certificate of Formation) with the Secretary of State. The base filing fee is $155.
File online at: Minnesota Secretary of State
An EIN (Employer Identification Number) is free from the IRS and required for any LLC with employees, multiple members, or that wants a business bank account.
Permits & Licenses in Minnesota
Hair Salon / Barbershop businesses in Minnesota typically need multiple permits and licenses. Estimated total permit costs are around $1,500.
Cosmetology license $50-$300 per stylist. Salon establishment license $100-$500. Health inspection $50-$300. Each stylist must have individual state license.
Always check with your local city and county offices for specific requirements. Requirements vary significantly between jurisdictions within Minnesota.
Insurance Costs in Minnesota
A hair salon / barbershop in Minnesota should budget approximately $3,000/year for insurance coverage.
Annual cost. General liability $400-$1,200/yr. Professional liability (for chemical treatments, allergic reactions) $300-$800/yr. Workers comp varies by state.
| Coverage Type | Details |
|---|---|
| General Liability | Covers third-party bodily injury and property damage claims |
| Workers Compensation | Minnesota rate: $1.05 per $100 payroll (national avg: $1.03) |
| Property/Equipment | Covers business property, equipment, and inventory |
| Total Annual Estimate | $3,000 |
Equipment & Setup
Hydraulic chairs $500-$3,000 each. Wash stations $500-$2,000 each. Mirrors $200-$800 each. Professional clipper sets $150-$400. Scissors $200-$800 per set. For a 4-chair salon: chairs alone $2,000-$12,000.
| Item | Budget | Mid-Range | Premium |
|---|---|---|---|
| Styling chairs | $4,600 | $18,400 | $55,200 |
| Plumbing for wash stations | $4,600 | $27,600 | $92,000 |
| Hair care products | $1,380 | $4,140 | $11,040 |
| Reception desk | $1,840 | $5,520 | $13,800 |
Working Capital
Plan for at least 3 months of operating expenses as working capital. For a mid-range hair salon / barbershop in Minnesota, that means approximately $23,000 ($7,667/month).
Monthly operating: rent $1,500-$5,000, staff costs $2,000-$10,000, utilities $300-$800, supplies $300-$800.
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Hair Salon / Barbershop Costs in Neighboring States
| State | LLC Fee | Permits | Insurance/yr | Cost Index | |
|---|---|---|---|---|---|
| Iowa | $50 | $1,000 | $2,600 | 0.8x | Details → |
| North Dakota | $135 | $1,000 | $2,500 | 0.8x | Details → |
| South Dakota | $150 | $1,000 | $2,500 | 0.78x | Details → |
| Wisconsin | $130 | $1,400 | $2,800 | 0.85x | Details → |