Booth Rental vs Commission: Which Model Is Right for Your Salon?

Booth rental or commission?

It's one of the biggest decisions in the salon business — for owners and stylists alike.

Get it wrong, and you end up with the wrong team, the wrong income, or the wrong headaches.

This guide breaks down both models so you can make the right choice for your situation.

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1. The two models explained

Commission model:

• Stylist works as an employee (or contractor)
• Salon pays a percentage of their service revenue (typically 40-60%)
• Salon handles booking, supplies, marketing, and operations
• Stylist focuses on cutting hair

Booth rental model:

• Stylist rents a chair/space for a flat fee (weekly or monthly)
• Stylist keeps 100% of their earnings
• Stylist is responsible for their own clients, supplies, and marketing
• Salon provides the space and basic amenities

Both work. Neither is "better." It depends on your situation.

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2. Commission model: Pros and cons

For salon owners:

Pros:

• More control over quality and client experience
• Build a cohesive team and culture
• Clients belong to the salon, not individual stylists
• Predictable labor costs as percentage of revenue

Cons:

• Higher operational responsibility (payroll, scheduling, management)
• Risk if stylists leave and take clients
• More legal/HR complexity

For stylists:

Pros:

• Steady client flow (salon brings them in)
• No upfront costs or business responsibilities
• Training, mentorship, and support
• Benefits possible (if employee)

Cons:

• Keep only 40-60% of what you earn
• Less independence and flexibility
• Income ceiling without ownership stake

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3. Booth rental model: Pros and cons

For salon owners:

Pros:

• Predictable income (rent is fixed)
• Less management overhead
• Lower risk — stylists are independent businesses
• Simpler operations

Cons:

• Less control over client experience
• Harder to build salon brand/culture
• Stylists may leave with their clients
• Quality varies by individual

For stylists:

Pros:

• Keep 100% of earnings (minus rent)
• Full control over schedule, pricing, products
• Build your own brand and clientele
• True entrepreneurship

Cons:

• Fixed rent even in slow months
• Responsible for your own marketing and clients
• No safety net or support
• Must handle your own taxes, insurance, etc.

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4. Which model makes more money?

It depends on volume and skill.

Example: Stylist earning $1,500/week in services

Commission (50%):

• Earnings: $750/week
• No rent, no supply costs (usually)
• Net: ~$750/week

Booth rental ($300/week rent):

• Earnings: $1,500/week
• Minus rent: $1,200/week
• Minus supplies (~$100): $1,100/week
• Net: ~$1,100/week

But if volume drops to $800/week:

Commission (50%):

• Earnings: $400/week

Booth rental ($300/week rent):

• Earnings: $800 - $300 - $75 = $425/week

The gap narrows quickly. Booth rental rewards volume, but commission provides stability.

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5. Questions to ask yourself (as a stylist)

Go commission if:

• You're early in your career and building skills
• You don't have a strong client base yet
• You prefer structure and support
• You don't want to run a business

Go booth rental if:

• You have a loyal, portable client base
• You want maximum income potential
• You're comfortable with business responsibilities
• You value independence over security

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6. Questions to ask yourself (as an owner)

Choose commission if:

• You want to build a branded salon experience
• You're willing to invest in training and culture
• You want long-term team stability
• Client relationships should stay with the salon

Choose booth rental if:

• You want simpler operations and less management
• You're okay with stylists having their own brands
• You prefer predictable fixed income
• You're building more of a "space" than a "team"

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7. Hybrid models exist

You don't have to pick one forever.

Common hybrids:

• Commission for junior stylists, booth rental for seniors
• Base rent + small commission percentage
• Sliding scale based on experience/tenure
• Commission with performance bonuses

Many successful salons blend models based on the stylist's experience and preferences.

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8. Legal and tax implications

Commission (employee):

• Salon handles payroll taxes
• Stylist gets W-2
• Salon has more control (and liability)

Booth rental (independent contractor):

• Stylist handles own taxes (1099)
• Stylist needs own liability insurance
• Misclassification risks if salon controls too much

Warning: The IRS looks closely at booth rental arrangements. If you control their schedule, require specific products, or set their prices — they may legally be employees. Consult an accountant.

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9. Making the transition

Stylist moving from commission to booth rental:

• Make sure you have enough clients to cover rent
• Save 3-6 months of rent as buffer
• Set up your own booking system
• Get liability insurance
• Plan your marketing

Owner switching models:

• Give plenty of notice (60-90 days minimum)
• Be transparent about why
• Help stylists transition if they're not ready
• Update contracts and legal agreements

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There's no wrong answer — only wrong fits

Both models build successful salons. Both models build successful careers.

The key is matching the model to:

• Your stage of business/career
• Your risk tolerance
• Your goals
• Your personality

Commission builds teams. Booth rental builds independence.

Know what you want, and choose accordingly.

👉 Vinci26 works for both models — helping booth renters and salon teams manage their own bookings, clients, and growth without marketplace fees or lock-in.

Build something that's truly yours.