How do I check a salon’s retail product sales before I buy it?

Shampoo, styling products and treatments can add a steady second stream to a salon, or they can be a small afterthought. Listings rarely say which. Before you rely on retail as part of the picture, ask the seller to separate it from services and show you how it is earned. If the salon uses a point-of-sale system, the records may be there.

Sales by product and by stylist

Ask for retail sales by month, by brand and by the stylist who rang them up. Look for a spread across products and across the team. If most sales come from one or two products or one or two people, you are looking at a line that may not survive a change in staff. Ask how spread out retail sales are across staff.

Inventory count and age

Ask for a dated count of retail stock with cost and expiry dates where products have them. Walk the shelves yourself. Dusty bottles, faded packaging and discontinued lines suggest stock that will not sell at full price. Agree in writing how inventory will be counted at closing and who bears the cost of anything unsaleable.

Back-bar versus retail

Back-bar products are used on clients and are usually recorded as a cost of service, not as retail revenue, though your accountant can confirm how the records treat them. Make sure the seller’s records keep the two apart, because mixed-up stock makes margins hard to read.

Dealer and brand terms

Some brands sell only to approved salons. Ask whether the dealer agreements carry over to a new owner, and what the brands will require. Your lawyer can read those terms. Due diligence checks this much, so see salon due diligence, but the sales themselves need your own review.