Sharkey’s Cuts For Kids Costs $238K (2023 Profit Stats)

Sharkey’s Cuts For Kids is one of the fastest-growing franchise in the hair salon industry: from 54 salons in 2018 it has 122 locations in the US today. We think there are a few good reasons for that: the franchise is not only one of the most affordable, but it can also be a very profitable business.

Indeed, at $238,000 Sharkey’s Cuts For Kids has a low price entry point vs. salon franchises in general (it costs on average $450,000 to buy and open a salon franchise in the US today).

In addition, you would make $257,000 revenue per year on average with one Sharkey’s Cuts salon. Sounds like a great franchise investment doesn’t it?

In this article we are looking at Sharkey’s Cuts For Kids and its latest Franchise Disclosure Document to find out how much it really costs, and how profitable it really is. Let’s find out!

Key stats

Franchise fee	$159,990*
Royalty fee	$1,000 to $1,750 per month per month
Marketing fee	3.00%
Investment (mid-point)	$238,000
Revenue per unit	$257,000
Revenue per sq. ft.	[franchise_value_revenue_per_sq_ft]
Sales to investment ratio	1.0x
Minimum net worth	$300,000
Minimum liquid capital	$144,990

About Sharkey’s Cuts For Kids

Sharkey’s Cuts for Kids is a leading provider of kid’s haircuts, targeting children aged 0-14.

It provides a fun, kid-friendly environment, unmatched haircuts and hair care expertise. 

All kid’s haircuts include complimentary services and products such as wash, cut, fun chairs, mini-cure, balloons, lollipops, Xbox One and PS4 and glamour rings – to name a few.

Sharkey’s Cuts for Kids was founded by Linda and Scott Sharkey in 2001 and is headquartered in Michigan. 

The kids’ hair care brand has been franchising since 2004. 

Today, Sharkey’s Cuts for Kids operates in over 117 locations worldwide, with 114 franchised studios in the US. 

Sharkey’s Cuts franchise pros and cons

Pros

• Passive ownership: the passive ownership model allows franchisees to pursue different business interests. 
• Limited competition: hair care for children has little competition with high revenue potential. 
• Fun to run: an exciting franchise opportunity to interact with kids and their parents, creating a unique experience with high-income potential. 
• Recurring revenue model: frequent haircuts for kids attract constant and predictable income. 
• Multiple sources of revenue: diverse income streams, including haircuts for kids, birthday parties, unique merchandise and hair accessories.
• No mandatory experience: the training department handles the challenging parts of starting and operating a franchise, so you don’t need a hair-care background to get started. 
• Fast-growing industry: children’s hair salons are becoming increasingly popular in the US, Europe, Canada and the Middle East, making this a lucrative franchise opportunity with high growth potential. 
• Franchisor support: the franchisor offers personal, ongoing support to help franchisees start and operate a thriving business.  
• Financial support: Sharkey’s Cuts for Kids partners with third-party financial sources to help franchisees cover the cost of equipment, franchise fee, accounts receivable and startup costs. 
• Simple model: professional haircuts for kids is a simple business concept that franchisees easily emulate to reap the benefits.  
• Exclusive territory protection: the Franchise Agreement protects franchisees from competition against other Sharkey’s Cuts for Kids studios. 
• Longevity: Sharkey’s Cuts for Kids uses a recession-proof business model that thrives even in a downward economy. 

Cons

• Not a part-time investment: the franchisor doesn’t allow part-time ownership. 
• Not a home-based opportunity/a mobile unit: franchises cannot operate from home or as mobile units. 
• Minimum employee requirement: 6-8 employees are required to run a franchise.
• Competition from other children hair care franchises e.g. Pigtails & Crewcuts or Cookie Cutters

Sharkey’s Cuts franchise costs

On average, you would need to invest around $238,000 to open a Sharkey’s Cuts For Kids franchise.

Of course, this is an average, as the exact amount depends on factors like location, size, etc. According to the latest Franchise Disclosure Document, the investment ranges between $188,665 and $299,360.

Sharkey’s is an affordable franchise: in comparison similar franchises require an initial investment of about $450,000 on average as per our own salon franchises benchmarks.

Also note that the investment may reduce to around $203,000 ($35,000 less) if you get a turn-key package from your landlord. Recommended by Sharkey’s Cuts For Kids, a turn-key is a contract with a landlord whereby the landlord provides the construction and/or remodeling to the franchisee as part of the real estate lease, which eliminates the need for hiring a contractor.

Startup costs

The investment covers all the startup costs you may need to start a salon. You must need to pay an initial franchise fee of $159,990 to the franchisor. In addition to this franchise fee, the investment also covers:

• Formation Costs: leasehold improvements, blue prints & plans, security deposit, permits, business licenses, professional fees, etc.
• Equipment: computer system & software, indoor & outdoor signage, lighting, washer, dryer, etc.
• Initial Marketing: grand opening advertising
• Operating Costs: insurance, first month’s rent, working capital for the first 3 months, etc.

Type of Expenditure	Low	High
Initial Franchise Fee	$159,990	$159,990
Formation Costs	$250	$67,620
Equipments	$14,500	$24,000
Initial Marketing	$12,000	$12,000
Operating Costs	$1,925	$35,750
Total	$188,665	$299,360

Sharkey’s Cuts franchise fees

Sharkey’s Cuts franchise revenue

A Sharkey’s Cuts For Kids franchised salon makes $257,000 in revenue per year on average.

This is the annual median sales of franchised salons operating in 2022 as disclosed in the FDD.

Sharkey’s Cuts franchises are doing well in terms of annual revenue growth (+38% revenue growth vs 2021). Indeed, a very fast recovery from the pandemic backlash on revenue.

When it comes to revenue per square foot, Sharkey’s Cuts franchises makes $219 in revenue per sq. ft., slightly lower than the average for salons franchises ($280 per square foot).

Median sales	2021	2022
First tier	$297,994	$367,000
Second tier	$218,068	$272,589
Third tier	$149,165	$230,483
Fourth tier	$78,393	$158,040
Median	$185,905	$257,028

Disclaimer

Disclaimer: This content has been made for informational and educational purposes only. We do not make any representation or warranties with respect to the accuracy, applicability, fitness, or completeness of the information presented in the article. You should not construe any such information or other material as legal, tax, investment, financial, or other professional advice. Nothing contained in this article constitutes a solicitation, recommendation, endorsement, advertisement, or offer to buy or sell any franchises, securities, or other financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the franchise and/or securities laws of such jurisdiction.

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