What's a healthy salon profit margin? The Australian benchmarks

There's no single "salon profit margin" number worth quoting on its own, because a healthy salon is really four ratios in balance. Get these four into their bands and the profit looks after itself. Here's what good looks like in Australia.

Net profit: 15–25%

This is the headline. A well-run Australian salon nets 15–25% before the owner's drawings and tax. Under 10% and one of the ratios below is out of place. Note the "before owner drawings" part — if you're paying yourself out of what's left and there's nothing left, that's the signal, not the salary.

Wages: 45% or under

Wages are the biggest cost in the building and the one that quietly drifts. Hold total team wages around 45% of revenue — barbershops run leaner at 30–40%, and pure service payroll is best held to 30–35%. Past 50% and the salon is working for the team, not the owner.

Rent: 8–15%

Rent should sit between 8% and 15% of revenue. Over 18% and either the site is too expensive for the takings or the takings are too low for the site — and no amount of trimming elsewhere fixes a rent problem.

Retail: aim for 12–15%+

Most salons ring retail at just 3–5% of revenue when 12–15%+ is on the table. Because retail carries 50–70% margin, it's often the fastest profit win in the salon — faster than raising service prices.

Revenue isn't profit. A busy salon can run in the red if the wages and pricing are off. Slot every line against the benchmark first — the number always tells the truth.

— Matt Grumley, Founder

Read it as a set, not one number

These ratios assume your wages and revenue cover the same period — we always confirm that before drawing a conclusion. And every forward figure is an honest estimate from your own numbers, shown as a scenario. Shear Profit coaches the business; tax and award figures (which reset every 1 July in Australia) go to your registered accountant.