Thinking of Buying a Tanning Salon in Australia? Here Are 3 Vital Questions to Ask
The Australian hairdressing and beauty industry, which includes tanning salons, generated $12.4 billion in revenue in 2025–26, with profit margins averaging 9.2%. The sector employs more than 110,000 people across 27,000 businesses.
Revenue is forecast to grow at 1.4% annually through 2030–31, reaching $13.3 billion, driven by demand for appearance-based services, population growth, and premiumisation. While tanning services face health and regulatory pressures, many operators diversify into spray tanning, skincare, and beauty add-ons to sustain profitability.
1. Is the Business Financially Resilient in a Competitive Industry?
Why It Matters
Tanning services compete directly with beauty salons, gyms, and at-home alternatives. Profitability depends on effective cost management, brand positioning, and diversified services. Businesses relying solely on tanning booths are more exposed to demand volatility.
What to Check
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Profitability – Benchmark against the industry’s 9.2% margin.
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Revenue mix – Assess reliance on tanning versus add-on services like spray tans or beauty treatments.
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Operating costs – Review wages (the largest cost category) and rent in retail precincts.
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Cash flow resilience – Examine how the business handles seasonal fluctuations in demand.
2. Does the Salon Have Strong Market Positioning and Client Appeal?
Why It Matters
Success in tanning salons depends heavily on reputation, location, and repeat clients. Operators in high-footfall areas and those offering premium spray tans or combined beauty services attract more stable demand.
What to Check
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Location – Confirm positioning in shopping centres, high streets, or near gyms.
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Customer loyalty – Assess repeat visits, memberships, or pre-paid tanning packages.
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Reputation – Review online ratings, social media presence, and local brand recognition.
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Service diversification – Identify whether services extend beyond tanning to include skincare, waxing, or cosmetic products.
3. Is the Business Positioned for Future Trends and Regulation?
Why It Matters
Solarium tanning has been banned in Australia since 2015, and consumers are increasingly health-conscious. Spray tanning and beauty-focused alternatives are growing, while eco-friendly and organic products are gaining popularity. Businesses that align with these trends will outperform.
What to Check
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Compliance – Verify adherence to health and safety standards, particularly for cosmetic tanning products.
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Sustainability – Review use of organic, cruelty-free, or eco-friendly spray tan solutions.
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Technology adoption – Check for modern spray tan equipment and digital booking systems.
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Trend alignment – Evaluate how the business positions itself around wellness, beauty, and safe tanning practices.
Ready to Invest in a Thriving Tanning Salon Business?
With beauty services in steady demand and tanning diversifying into safer, premium alternatives, salons remain a viable investment.
Success will depend on financial stability, client retention, and alignment with regulatory and consumer health trends.
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