Should You Leave Your Commission Salon and Go Independent?

What Made Jasmine Finally Take the Leap

Jasmine Williams worked at a high-end commission salon in Chicago for seven years. She was one of their top producers, consistently bringing in $12k or more in services every month.

But she was only taking home about $5,200 of that.

"I kept doing the math in my head," Jasmine told me. "I'm generating all this revenue and keeping less than half. And I have zero control over my schedule, my pricing, or anything else."

She was scared to leave. The salon had given her a client base. They handled all the business stuff. What if she couldn't do it on her own?

We worked together on a transition plan. She saved for six months, set up her legal structure, secured a suite, and communicated with her clients the right way.

Eighteen months later, Jasmine's averaging $14k months and keeping about $9,800 of it after all expenses. She works four days a week instead of five. She takes three weeks of vacation a year.

"I can't believe I waited so long," she said. "I was so afraid of the unknown that I stayed stuck in a situation that wasn't serving me."

Which Path Actually Makes Sense for You?

Your first decision is the most critical one: choosing the right business model. Most guides only compare booth rental and suite rental, but that's an incomplete picture.

Let me break down all four options so you can make a decision based on strategy, not just whatever happens to be available down the street.

Path 1: Staying Commission

This is where most stylists start, and honestly, it's the right choice for a lot of people.

You're a W2 employee. The salon owner handles overhead, marketing, and administrative tasks. You typically earn 40-60% commission on services and a much smaller cut on retail, usually 10-20%.

Taylor McKenzie is a stylist in Nashville. She came to me convinced she needed to go independent, but when we looked at her numbers together, she was only two years into her career with about 60% of her books filled.

"Honestly, I think you should stay where you are for another year or two," I told her. "Build your clientele to at least 80% capacity, save some money, and then make the move from a position of strength."

She wasn't thrilled to hear it, but she listened. Two years later, she made the transition with a full book and six months of savings. Her first year independent was profitable from month one.

This path is for: Newer stylists still building a clientele, professionals who genuinely prefer not to manage business operations, and those who value the structure and team environment.

Path 2: Booth Rental

This is your first real step into independence. You rent a chair in an established salon for a flat weekly or monthly fee.

You keep 100% of your service and retail revenue. But you're now responsible for your own booking, marketing, product inventory, and taxes. That flat rent is due whether your chair is full or empty.

Vanessa Ortiz rents a booth in Houston. She pays $350 a week and keeps everything she earns above that.

"The energy of the salon is what I love," Vanessa told me. "I didn't want to be alone in a suite all day. I like having other stylists around, bouncing ideas off each other, the buzz of a busy Saturday."

Her monthly revenue averages $11k. After rent, products, and setting aside money for taxes, she takes home around $6,500. More than double what she made on commission.

This path is for: Stylists with a consistent client base who want more autonomy but still want the atmosphere of a shared salon space.

Path 3: Suite Rental

You lease a small, private studio within a larger suite facility. Higher rent than a booth, but you get complete control over the environment.

You control the music, the decor, the entire client experience. You keep 100% of all revenue and handle all business aspects yourself.

Brittany Cole moved into a suite in Denver after five years of booth renting. Her rent jumped from $400 a week to $650, but her average ticket went up even more.

"When I had my own space, I could finally charge what I was worth," Brittany said. "The whole vibe changed. Clients felt like they were getting a luxury experience instead of just a haircut in a busy salon. I raised my prices 30% and nobody blinked."

Her revenue increased from $9k to $13k monthly. Even with the higher rent, she nets more than she did booth renting.

This path is for: Established stylists who want to create a highly personalized, one-on-one client experience and operate as a micro salon owner.

Path 4: Full Salon Ownership

This is the ultimate step. You lease or buy commercial space and build a salon from the ground up, potentially hiring your own team.

I've owned multiple salons, including The Warehouse Salon in Fairfield and DeLand, plus Studio 360 in Chatham. I can tell you from experience: this is a completely different game.

You're responsible for everything. Buildout costs, payroll, marketing, inventory for the entire salon, all operational systems. True ownership means building an asset, but it requires skills that have nothing to do with being great behind the chair.

This path is for: Entrepreneurial stylists with a strong business mindset, leadership skills, and a clear vision for building a scalable brand and team. Not everyone should do this, and that's okay.

If you go the ownership route, you'll need systems for everything from SEO to bring in new clients to a website that actually converts visitors.

What Should You Actually Do Before You Give Notice?

A successful transition isn't something you decide on Friday and do on Monday. It's a strategic process that begins months before you leave.

Samantha Reed is a colorist in Portland. She reached out to me after making the leap with basically no preparation.

"I just got fed up one day and quit," she said. "I figured I'd figure it out as I went."

Three months later, she was scrambling. She hadn't saved enough for the slow first weeks. She didn't have her booking software set up. She was doing her own taxes wrong and owed penalties.

"I wish someone had told me to slow down and plan," she said. "I made it work eventually, but those first six months were brutal and unnecessary."

Here's what you should do 3-6 months before you make the move:

Build Your Financial Runway

Start saving aggressively. You need at least 3-6 months of personal and business expenses before you make the leap.

This isn't just for rent. It's for insurance, product inventory, licensing fees, and a cushion for unexpected slow weeks. The stylists I've seen fail almost always underestimate how much cash they need in reserve.

Secure Your Digital Presence

Quietly secure your business name, social media handles, and domain name. Set up a professional email address. You don't need to announce anything yet, but you need to own your digital real estate before someone else does.

Know Your Numbers Cold

Start tracking your service revenue, retail sales, and client count meticulously. You need to know your average ticket and rebooking rate to build realistic financial projections.

Don't rely on the salon's software. Keep your own records. Monica Nguyen in San Diego told me she was shocked when she started tracking her own numbers.

"I thought I knew how much I was bringing in, but I was off by almost $2k a month," Monica said. "Having the real numbers made my whole plan more solid."

What Legal and Financial Setup Do You Actually Need?

This is the part that feels overwhelming. I get it. But getting this right from day one protects you from liability and sets you up for long-term wealth.

Here's what you need to handle:

Choose Your Business Entity

While a Sole Proprietorship is easiest, forming an LLC is often the smartest move. It separates your personal assets from your business debts, providing a crucial layer of liability protection.

If someone slips and falls in your suite and decides to sue, you don't want them coming after your house.

Get Your EIN

An Employer Identification Number is free from the IRS. Even if you never plan to hire anyone, an EIN lets you open a business bank account and start building business credit without using your personal Social Security number everywhere.

Open a Separate Business Bank Account

This is critical. Commingling personal and business funds can destroy your liability protection and creates a nightmare come tax time.

All business income goes in, all business expenses come out. No exceptions. No "I'll just transfer it later." Keep it clean from day one.

Get Proper Insurance

You need both General Liability (for slips and falls) and Professional Liability (to protect against claims related to your services). They are not the same thing, and you need both.

Use a Real Payment Processor

Using Venmo or Cash App for business transactions is usually against their terms of service and looks unprofessional. Set up Square or Stripe from the start.

Understand Self-Employment Tax

This is where a lot of new independents get burned.

As an independent contractor, you're responsible for paying the entire 15.3% for Social Security and Medicare. Plan to set aside 25-30% of every dollar you earn for taxes.

Danielle Harper in Atlanta called me in a panic her first April.

"I owe the IRS $8,000 and I don't have it," she said. "Nobody told me about quarterly payments."

We got her on a payment plan and set up systems so it never happened again. But that stress was completely avoidable with proper planning.

Set Up Retirement Savings

This is a huge opportunity most stylists miss entirely.

A SEP-IRA or Solo 401(k) allows you to save significantly more for retirement than a traditional IRA, with major tax advantages. Your commission salon wasn't doing this for you. Now you can do it for yourself, and the tax benefits are substantial.

What Mistakes Will Tank Your Independence?

I've watched hundreds of stylists make this transition. The ones who struggle almost always make one of these preventable mistakes.

Misunderstanding Your Legal Status

If you're a booth renter, you're a tenant, not an employee. Your salon owner cannot legally dictate your schedule, your pricing, or the products you use.

Understanding the IRS tests for independent contractor vs. employee status is crucial. Some salon owners try to have it both ways: calling you independent but treating you like an employee. Know your rights.

Signing a Bad Agreement

Never start renting without a clear, written lease agreement that outlines rent, duration, and exactly what's included. Utilities? Backbar? Towels? Laundry?

Get it in writing or it doesn't exist.

Assuming Your Clients Will Just Follow

Your clients may love you, but they're also creatures of habit. You need a proactive communication plan to make sure they follow you to your new location.

Don't just assume. Make it easy. Send them your new booking link. Remind them multiple times. The stylists who take client transition seriously keep 80-90% of their book. The ones who assume lose 30-40%.

This is the same principle behind why your best clients quietly disappear. Without systems and communication, people drift away.

Not Charging Enough

This one kills more independent stylists than anything else.

Your prices must now cover your rent, products, insurance, marketing, taxes, retirement, AND your salary. You cannot price your services based on what you charged when you were on commission.

You must price for profitability. Period.

Thinking Like a Stylist Instead of a CEO

You're no longer just a stylist. You're the CEO of your own small business. This requires a different way of thinking.

The disciplined mindset I learned as a Marine and apply to running my salons is what separates thriving owners from burnt-out technicians. You have to work on your business, not just in it.

If you find yourself working 70 hours a week while feeling like everything depends on you, you're thinking like a technician, not an owner.

Frequently Asked Questions

How much money do I actually need saved before going independent?

Save 3-6 months of both personal living expenses and projected business expenses before making the move. Jasmine Williams saved for six months and never panicked during slow weeks because she had a cushion. The stylists who fail almost always underestimate how much cash they need in reserve.

How do I tell my clients I'm leaving without burning bridges?

Check your employment agreement for client solicitation clauses first. Generally, you can make a professional announcement on social media and personally contact clients once you've officially left. Never speak negatively about your former salon. This industry is small and word travels fast.

What if my clients don't follow me to my new location?

If you have strong relationships and communicate proactively, expect 80-90% to follow. Send your new booking link multiple times. Make it easy. Vanessa Ortiz worried about this constantly and ended up keeping 85% of her book. The discount shoppers who only cared about location didn't follow, and that was fine.

Can I actually make more money after all these new expenses?

Yes. On a $200 service at 50% commission, you keep $100. Independent, you keep the full $200 minus about $40 for products and $60 for taxes, leaving $100. But you also keep 100% of retail profit, can raise your prices since you control them, and overhead stays flat while revenue grows. Brittany Cole increased her take-home by over $3,000 monthly within a year.

When is the right time to make the transition to independent?

When you have at least 80% of your books consistently filled, 3-6 months of expenses saved, and you've tracked your own numbers for at least 3 months. Taylor McKenzie waited two extra years at my advice, built her book to full capacity, and was profitable from month one as an independent.

Ready to Build Something That's Actually Yours?

Going independent is the first step toward building your own personal economy. It's about moving from trading hours for dollars to creating a business that generates wealth, not just wages.

This transition is your opportunity to stop working in a business and start working on one. It's the chance to build a brand, a culture, and a future on your own terms.

But it requires systems, discipline, and a plan. I break down all of this in detail in my masterclasses for stylists ready to think like business owners.

I've helped hundreds of stylists make this transition successfully through Level Up Academy. If you're ready to stop thinking like a stylist and start acting like a CEO, I'd love to talk.

Apply to Join Level Up Academy