Salon Business, Professional Practices, and Tennessee Laws and Rules
Salon Business, Professional Practices, and Tennessee Laws and Rules
Money, ownership and the numbers
Business questions reward the candidate who separates revenue from profit. Gross income is what comes in; net profit is what remains after product, rent, payroll, taxes, insurance and marketing. Know the ownership models - sole proprietorship, partnership, corporation, LLC and franchise - plus compensation models: salary, hourly, commission, and booth rental, where the stylist pays rent and handles their own taxes.
Cost per service is the core calculation. Add the fixed monthly costs (rent, utilities, insurance, your own draw) plus variable costs (product, laundry, supplies), divide by the number of services performed, then add the product used on that one client. Markup is applied to cost to set price; margin is the percentage of price that is profit. They are not the same number.
Also tested: inventory control (par levels, first in first out), client records and confidentiality, scheduling and retention, retail selling, and compliance with OSHA, EPA and state sales tax requirements.
Traps
- A 50% markup is not a 50% margin.
- Gross sales presented as profit.
- Booth renters are self-employed for tax purposes; commission employees are not.
- Confusing the salon's obligations with the individual licensee's obligations - read who the question is about.
Rule of thumb
Cost per service = (monthly fixed costs ÷ services performed that month) + product cost for that service. Price = cost × (1 + markup).
Professional Practices and Tennessee Laws and Rules
Scope, ethics and the Tennessee rulebook
Professional practice questions test judgment as much as recall. Know your scope: perform only services your license covers, never diagnose or treat a disease, and refer anything infectious, undiagnosed or outside your training. Confidentiality, informed consent, honest advertising, punctuality, and clean professional appearance are all fair game.
Tennessee regulates cosmetology through the state board that oversees cosmetology and barbering under the Department of Commerce and Insurance. The rules you should be able to reason about, even if you cannot recite them: a current license properly displayed, a licensed establishment, sanitation standards that mirror the infection-control domain (clean, then disinfect with an EPA-registered hospital-grade product; discard single-use items), safe storage and labeling of chemicals, and required recordkeeping.
Licensure mechanics - renewal cycle, continuing education hours, late fees, school and instructor requirements - are amended regularly. Learn the structure of the rules and verify current numbers with the board rather than memorizing a figure from an outdated study sheet.
Traps
- Exact-number questions (renewal interval, CE hours, fees) are the ones most often outdated; if you are not certain of a number, choose the answer that reflects the rule's purpose.
- "The salon owner is responsible" versus "the licensee is responsible" - both can be true; read who is being asked about.
- Practicing outside scope is a licensing violation, not merely an ethical lapse.
Rule of thumb
When a scenario feels ambiguous, apply the three-part test: Is it in my scope, is it sanitary, and would I be comfortable if both the inspector and the client read my notes?