For stations, dryers and shampoo units, a Port Huron salon owner usually looks at an equipment loan or lease, which the equipment secures; for retail product and uneven weeks, working capital or a credit line fits better. A card-sales advance is a third option, and not a loan.
An article from Frosthaven Funding in Port Huron, Michigan comparing equipment loans, working capital and card-sales advances for salons, with St. Clair County counts and an invented example. Funding partners review each request and decide.
Which fits a St. Clair County, MI salon: the short answer
Match the money to the purchase. Styling stations, hydraulic chairs, hood dryers and shampoo units are equipment, with a resale value, so an equipment loan or lease suits them. Retail product, color stock and the payroll of a new stylist before her book fills are short-term costs, which suit working capital or a credit line. A build-out of a leased suite is a term loan. A card-sales advance can fund any of these, but it is not a loan and it is priced differently.
For St. Clair County, MI in 2023, County Business Patterns counted 19 beauty salons with paid employees, with 69 paid employees; 13 of them had fewer than five employees. Without paid staff, the county had 449 beauty salons, 83 nail salons and 33 barber shops in Nonemployer Statistics for 2024, a Census program kept apart from the employer counts.
Stations, dryers and shampoo units on an equipment loan
An equipment loan on stations, dryers and shampoo units works like any other: the salon picks the equipment, the partner pays the supplier, and the salon repays over a set term, with the equipment as security. Salon equipment is smaller than a machine shop's, so the amounts are smaller and terms often shorter. Some suppliers offer their own leasing on furniture packages.
Illustration only, invented figures: four styling stations at $3,200, three hood dryers at $1,900 and two shampoo units at $2,600 come to $23,700. On a 36-month equipment loan at an invented annual rate of 10.5%, that is about $770 a month, and about $27,731 in all (our arithmetic).
Working capital for retail product and uneven weeks
Retail product is stock: shampoos, styling products and tools sold over the counter. A salon placing a larger opening order for a new product line, or carrying color stock for a growing team, can use working capital or a small credit line, repaid as product and services sell. Uneven weeks, such as the weeks after a stylist leaves and before a replacement's book fills, are the same kind of gap.
Illustration only, invented figures: a $9,000 working capital loan over 9 months at an invented annual rate of 13% is about $1,055 a month (our arithmetic). Working capital loans in Port Huron, MI explains how such loans are repaid.
Card-sales advances and why salons compare them with a loan
A salon that takes most payments by card may be offered a merchant cash advance: a provider pays a lump sum and collects a share of future card sales until a fixed total is reached. It is not a loan. The appeal is that collection moves with card sales; the catch is that the total collected is set at the start, so the cost in dollars is fixed however soon it is collected.
Compare the advance's total with the total interest and fees on an equipment loan or working capital loan for the same amount. Merchant cash advances in Port Huron, MI explains factor rates and holdbacks.
What a lender reviews from a salon owner
A lender reviewing a salon owner looks at business bank statements for card and cash deposits, the latest tax return, the owner's credit, the lease and how long it runs, and, for a salon with booth renters or suite tenants, the rental agreements and how reliably they are paid. For an equipment request it also wants the supplier's quote.
- Recent business bank statements.
- The latest business and personal tax returns.
- The salon lease.
- Equipment quotes, and the build-out bid if there is one.
- Any existing equipment leases or card-sales advances.
A salon with a short time in business may be asked for more about the owner: personal credit, the owner's own experience behind the chair, and a plan for filling the stations. A partner also notes any existing advance being collected from card sales, because it reduces the cash available for a new payment.
A salon owner's checklist before choosing between the three
- List what the money buys: equipment, product, payroll or a build-out.
- Put equipment on its own request, priced over its working life.
- Size any working capital to a known gap with an end date.
- Ask for each option's total cost in dollars.
- Read the collection terms on any card-sales advance before signing.
Equipment financing in Port Huron, MI compares loans and leases; the industry notes cover salons and barbers in St. Clair County, MI.
By Frosthaven Funding · Updated
