Complete Guide to Barber Shop Expenses

Aside from the obvious barber shop expenses, like equipment and rent, barber shop owners and managers are required to consider the typical barber shop expenses in everyday operations. Do not fret- this isn't as hard as it sounds.

What You Will Learn

We'll review some common barber shop expenses you must plan for, how to budget cash for these expenses and what you can do to minimize or remove them.

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  1. What is Barber Shop Overhead?
  2. What Are Some Barber Shop Expenses?
  3. How to Reduce Your Barber Shop Overhead Prices?
  4. Barber Shop Expense Sheet Template
  5. Conclusion

What is Barber Shop Overhead?


The term "Barber Shop Overhead" covers various expenses and generally includes things like your barber shop equipment, barber shop product inventory, and the supplies that your barbers utilize- including shampoo or hair styling products. It also covers your monetary expenses, such as staff payroll, any taxes that you pay, maintenance, and business insurance coverage for your barber shop. These are all things that you'll need to keep track of and comprehend to stay in control of your overhead costs.

Now, let's have a look at all of these items in a little more detail.

What Are Some Barber Shop Expenses?


Barber Shop expenses can be divided into 2 categories: Recurring Expenses and Occasional Expenses. While it's crucial to keep an eye on a barber shop's occasional expenses, it's not always possible to predict what specifically these costs will be or how they will affect your profit margins. Recurring expenses, nevertheless, can and ought to be accounted for. They're the typical costs that need to be paid each month, so you'll have a good understanding of how each recurring expense will impact your income earnings and bottom line.

Let's start with a breakdown of recurring expenses. Recurring expenses are the costs that you can expect to pay frequently, normally monthly. These prices are much easier to budget for, especially if you utilize barber shop software to track your business expenses in one place.

Some Barber Shop Monthly Recurring Expenses Are:

Staff salaries and Wages

People often ask, "What is the largest expense in running a barber shop?" The answer is normally salaries. The average barber in the U.S. makes nearly $32,500 a year. This can quickly add up if you have a lot of staff. Keep track of your payroll costs.

Payroll (social) Taxes

These costs will differ, depending upon your area. Ensure to research what's needed in your area and reserve some money to cover these costs.


If you're still selecting a barber shop business location, check out the typical rent costs in your area online. These will depend a lot on location. Businesses normally pay greater rent than residential properties, so it's important to stay educated and have a dollar amount in mind when planning your barber shop's budget. This will add a lot more money to your total profits by reducing the overhead expense if you can save on rent.

Licenses and Permissions

Business licenses are necessary, but they differ depending upon the city, state, or province. You will probably require health and safety inspections and certificates. In some locations, you'll be free to offer retail products connected to your barber shop, but in other locations, you will need to pay for an authorization. Check your state's website and the website for your city to see what's needed.


Most likely, you'll eventually wish to purchase some additional education, training, or professional development for each barber at your business. Barber shops often look for brand-new training to stay up to date with the latest men’s grooming trends or techniques. The male grooming industry is continuously changing, and this suggests that businesses require to keep up. Education is critical here. A new training course or license won't be free. Still, if barber shop owners work with each staff member and choose thoroughly, the long-lasting benefit from education investments will add a lot to your earnings and raise your barber shop's month-to-month income. Plus, it's a great way to develop staff member commitment.

We recommend you to check out our post How to Write a Barber Shop Business Plan.

Barber Shop Software and POS System

These systems differ in cost, depending upon your barber shop's needs. Pick exactly what metrics you wish to track (for instance, do you need to know when you should reorder your product stock, what appointments are coming up, or just how much revenue each barber has brought in so far)? As soon as you understand this, you can find something that fits your requirements. A POS system is needed for processing transactions, but keep in mind that it may also require specific equipment (such as iPads, if it utilizes wifi) and receipt paper.


No matter what services they provide or what industry they're in, businesses all need to take care of utilities. Barber Shops all need water, electrical energy, and heat, naturally. It's a good thought to look up the typical costs for these services in your location. To give you an idea, the typical electrical power bill for a barber shop starts at around $150 each month, and water bills can cost from $45 to over $150 for the largest and busiest barbershops.


In addition, you'll need to think about the price of internet service and a phone line. A stable internet connection is important for processing payments, taking care of your barber shop's social networks presence, and doing any online marketing.

Back Bar Supplies

You must have enough grooming supplies and basic tools prepared for each staff member to use when you start your barbershop business. Keep in mind to include these business costs in your regular monthly prices/ expense budget. A barber shop's back bar supplies typically include hair shampoos, sanitizers, shaving cream and styling products.

Barber Shop Product Inventory

This is not the stock that your team members use on clients. It's your supply of retail items. A large part of a barber shop's income comes from product sales, so it's essential to have enough inventory all set for your employees to make add-on sales and recommendations.

Barber Shop Equipment Leasing

Nowadays, leasing is among the most popular ways to acquire equipment. Instead of paying fully or putting it on credit, you'll establish a fixed month-to-month payment towards the price of your equipment. At the end of the leasing period, your business will typically have the choice to settle the final amount and own the equipment outright or renew your lease with the latest equipment. By doing this, you can minimize any maintenance worries and keep your barber shop at the cutting edge of the men’s grooming industry.

We recommend you to check out our post on Complete Barber Shop Equipment List.

Online and Credit Card Processing Charges (Fees)

Credit card processing fees can differ a bit, depending on your service provider. The typical charge that you'll come across is around 1.5% to 2.7%, however, be careful. Some providers will charge as much as 3% or more. As a barber shop owner or manager, make certain to do your research. These apparently minor changes can quickly consume your profits.


Barber shop monthly expenses for marketing vary extensively, depending on your business strategy and the tools you utilize. An email marketing campaign or a barber shop newsletter can be relatively affordable, especially if you have a staff member who can assist with this. The cost of putting an ad online or in print, especially if you employ a professional to do it, can be pretty costly.

Insurance Costs

Business insurance will not be your most substantial overhead expense, but it's an essential one. Insurance coverage isn't just a smart idea. It's a legal requirement. As a barber shop owner, anticipate paying anywhere from $500 to $700 a month for business insurance coverage costs, depending upon your barber shop services and location. There's also the possibility that providers will propose extra business services, such as health insurance for your employees. Not all barber shops select to provide this, however it might be something to think about if you want to bring in and keep experienced staff. The dollar cost of insurance coverage will vary a lot, depending on the location of your business. Do your research and see which providers fill your needs, and make certain to compare quotes.

We recommend you to check out our post How To Manage a Barber Shop.

Your Occasional (one-off) Barber Shop Costs Will Be:

Barber Shop Opening Costs

Barber Shop start-up expenses will include hiring barbers and personnel, cleaning and retrofitting your brand-new site, and advertising expenses for your new business.

New Equipment Purchases

If you decide not to lease equipment, you'll be required to purchase it. And the costs will depend a lot on the type of barber shop business. Is it only a hair barber shop? Does your business provide clients with other services like tattoos or manicures? These are all associated expenses that can add to your basic equipment cost. You can anticipate spending somewhere in the range of at least $27,000 if you need to purchase your basic equipment. That includes everything from chairs, shampoo stations, hair dryers, and hairstyling/ cutting tools. You can always start small, adding more equipment as you need it.

Barber Shop Fit-out

A properly designed barber shop with decor that stands out is crucial to be competitive and bring in more earnings. For instance, a barber shop is more likely to prosper if it feels open and welcoming, not cluttered or dated. It's essential to budget for this when opening a brand-new barbershop. Think about setting aside a part of your earnings each month towards future improvements or updates.


This is a big one. Not big in regards to expense; it's just extremely important. It is an excellent time to get creative and shop around. Proper signs can be remarkably cheap if you shop around carefully. That said, a professionally made sign can also cost several hundred dollars, depending on your requirements.


Having an online exposure is essential to success as a barbershop nowadays. Think about investing a little cash (or time, at the very least) in a barbershop website. It does not need to be costly, although you can work with a professional web designer if you wish to benefit from that "wow factor." It's also fine to start with something less complex, like an online template.

Miscellaneous Expenses

These are everything from the cash float in the till to any dollar amount you need to spend on random emergencies. It's a smart idea to have at least $500 put aside to spend for unanticipated things.

How to Reduce Your Barber Shop Overhead Prices?


Understand What Exactly Drives Your Overhead

Have routine meetings and talk with your personnel. Make certain that they feel safe complaining to you about anything related to the barber shop that they think is troublesome or inconvenient. Since they're on the front lines, employees will typically notice unproductive expenses before you do. Show that you're on their side, value their input, and after that establish a strategy to deal with the most substantial expenses first. You'll be surprised by how much money and time you'll save. You'll also have more satisfied personnel and more satisfied customers.

Usage Barber Shop Management Software and POS System

Since it will track and record transactions as they take place, proper Barber Shop Software and a POS system will save you plenty of time and money. That is especially useful for processing online transactions and credit card payments for your barber shop. Speaking from experience, the benefits of barber shop software far outweigh the costs because of the time you'll save. This is important for your business success and your mental health. You can set schedules, track bookings, check your stock of goods, and see which barbers are reaching their targets, all in one place. It will cut way down on the stress of day-to-day business operations and really help free you up to focus more on your customers.

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