How to Start a Hair Salon in Michigan (2026)

Last updated: February 25, 2026

Opening a hair salon in Michigan requires both an individual cosmetology license and a separate establishment license, both issued through LARA’s Board of Cosmetology. Michigan requires 1,500 hours of cosmetology school training (or a 2-year apprenticeship), plus specific sanitation and facility standards for the salon itself.

This guide covers every step from getting your cosmetology license to opening the doors of your salon, including establishment licensing, sanitation requirements, insurance, and costs.

Hair Salon Requirements in Michigan at a Glance

Requirement	Agency	Cost	Timeline
LLC Formation	LARA Corporations Division	$50	5-10 business days
Federal EIN	IRS	Free	Immediate (online)
Cosmetologist License	LARA Board of Cosmetology	$245 initial ($63 app + $91 written + $91 practical exam)	After completing 1,500 hours + exam
Establishment License	LARA Board of Cosmetology	$95 (initial/renewal)	2-4 weeks after inspection
General Liability Insurance	Private insurer	$500-$1,500/year	Same day
Workers’ Compensation	Private insurer	Varies by payroll	Same day
Local Business License	City clerk	Varies by city	Varies

How to Start a Hair Salon in Michigan (Step by Step)

Step 1: Get Your Cosmetology License

Michigan requires individual cosmetologists to be licensed through the LARA Board of Cosmetology:

Training Requirements (choose one path):

Cosmetology school: Complete 1,500 hours at a LARA-approved school of cosmetology
Apprenticeship: Complete 2 years (minimum 1,920 hours) as an apprentice in a licensed cosmetology establishment under an approved training plan

Licensing Exam and Fees:

Exam: Written ($91) and practical ($91) components
Application fee: $63
Total initial cost: $245 ($63 application + $91 written exam + $91 practical exam)
License renewal: $48 every 2 years (expires August 31 of even-numbered years)
Relicensure fee: $83 if license has lapsed

Step 2: Form Your Business Entity

Step 3: Find and Prepare Your Location

Your salon space must meet the Board of Cosmetology’s establishment requirements:

Adequate ventilation and lighting
Hot and cold running water at all shampoo stations
Separate storage for clean and soiled items
Proper sanitation and disinfection stations
Enclosed waste containers
Accessible restroom facilities
Compliance with local building codes and zoning

Step 4: Apply for Establishment License

Submit your application to the Board of Cosmetology:

Application fee: $95 (includes application and initial license)
Required with application:
- Drawing or diagram of the proposed establishment
- Label and identify all designated work areas for each service offered
- Clearly identify all shampoo bowls and pedicure basins (if applicable)
- Show all walls, doors, and indicate any connecting rooms or businesses
Renewal: $50 every 2 years

Step 5: Pass Inspection and Get Licensed

A Board of Cosmetology inspector will visit your salon to verify compliance with all establishment rules, including sanitation, equipment, facility layout, and safety standards. After passing, your establishment license will be issued.

Step 6: Get Insurance and Open

General Liability Insurance

Cost: $500-$1,500/year for hair salons
Covers: Client injuries (allergic reactions, burns, slip-and-fall), property damage

Professional Liability (Malpractice) Insurance

Cost: $200-$500/year
Covers: Claims of negligence or errors in services provided

Workers’ Compensation

Required if meeting Michigan’s employee thresholds. If you hire stylists as employees (not booth renters), you’ll likely need coverage.

Booth Rental vs. Employee

Michigan distinguishes between employees and independent contractors (booth renters). If stylists set their own hours, provide their own tools, and pay booth rent, they may qualify as independent contractors. However, misclassification carries penalties. Consult Michigan’s classification guidelines before deciding.

Sales Tax

Salon services are generally exempt from Michigan’s 6% sales tax. However, retail product sales (shampoo, conditioner, styling products) are taxable. Register for a sales tax license through Michigan Treasury Online if you sell retail products.

Cost to Start a Hair Salon in Michigan

Item	Cost	Notes
Michigan LLC formation	$50	Annual statement $25/year
Federal EIN	Free	Apply online at IRS.gov
Cosmetologist license (app + exams)	$245	$63 app + $91 written + $91 practical; renewal $48/2 years
Establishment license	$95	Renewal $50 every 2 years
Cosmetology school tuition	$10,000-$20,000	1,500-hour program; varies by school
Lease deposit and first month’s rent	$2,000-$8,000	Varies by location
Salon buildout/renovation	$10,000-$50,000	Plumbing, electrical, flooring, stations
Salon equipment and furniture	$5,000-$20,000	Chairs, stations, shampoo bowls, dryers
Initial product inventory	$2,000-$5,000	Color, chemicals, retail products
General liability insurance	$500-$1,500/year	Plus professional liability

Estimated total startup cost: $5,000-$10,000 (booth rental model) to $30,000-$100,000+ (full salon buildout)

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Frequently Asked Questions

What license do I need to open a hair salon in Michigan?

You need two licenses: an individual cosmetologist license ($245 total – $63 application + $91 written exam + $91 practical exam, requires 1,500 hours of training or 2-year apprenticeship) and a cosmetology establishment license ($95, requires floor plan submission and inspection). Both are issued by LARA’s Board of Cosmetology.

How many hours of cosmetology school do I need in Michigan?

Michigan requires 1,500 hours at a LARA-approved cosmetology school. Alternatively, you can complete a 2-year (1,920-hour) apprenticeship in a licensed cosmetology establishment. After meeting the training requirement, you must pass the state licensing exam.

Are salon services taxable in Michigan?

Salon services (haircuts, coloring, styling) are generally exempt from Michigan’s 6% sales tax. However, retail product sales (shampoo, conditioner, styling products sold to clients) are taxable. Register for a sales tax license if you sell retail products.

How much does it cost to open a salon in Michigan?

Costs range from $5,000-$10,000 for a booth rental model (renting a station in an existing salon) to $30,000-$100,000+ for a full salon buildout including lease, renovation, equipment, and inventory. Licensing fees total about $340 combined ($245 cosmetologist + $95 establishment).

Can I rent booths to other stylists in my Michigan salon?

Yes. Michigan allows booth rental arrangements where stylists operate as independent contractors. However, you must ensure the arrangement genuinely qualifies as independent contractor status – the stylist must set their own hours, use their own tools, and control how services are performed. Misclassifying employees as contractors carries penalties.

How often do I need to renew my Michigan cosmetology license?

Individual cosmetologist licenses renew every 2 years (expiring August 31 of even-numbered years) for $48. Establishment licenses also renew every 2 years for $50. If your license lapses, relicensure costs $83 for individuals and $95 for establishments.

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About the Author

Robert Smith has run a licensed private investigation firm for 8 years from the Florida-Georgia state line - where he learned firsthand how wildly business licensing rules differ between states just miles apart. He personally researched requirements across all 50 states and D.C., reviewing hundreds of government sources over hundreds of hours to build guides he wished existed when he started. Not a lawyer or accountant - just a business owner who has done the research so you don't have to.

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