Hair One. First off, congrats on being 100% O&O!
Advertising can be very expensive, and can end up yielding a very low return on your investment. However, done right, it doesn't have to be expensive or lack results.
Have you determined your target audience (clients)? Have you figured out how far of a radius you'll need to reach those targeted clients? These answers will greatly influence the method of advertising.
The type of client you're serving will determine the look and feel of your ad pieces. Are you a family style shop? Then you can get away with fun and off beat ads. Are you an upscale salon? Then you'll want a more polished and professional look. If you are artistic you might be able to design the pieces yourself. However, a lot of your time and effort can be best used hiring a professional designer / design firm. In addition to providing an appropriate design for your target audience, they can help get the most "bang" for your advertising dollars. Kind of like a good accountant can end up saving you money in the long run.
With the above items taken care of, you can look to some free and low cost advertising venues.
1. Being in the hair industry, sponsoring a "Locks of love" hair-a-thon for your community would generate some excellent press. You can send out a PSA (public service announcement) a week to two in advance to all your local newspapers, tv stations, radio stations.
2. Coupons provide a way to generate new clients, and provide trackable results (very important), especially a "bring a friend - buy one get one xx% off". There are many online printers who do good work, offer short print runs, and don't charge a lot. Be prepared to do some leg work getting the coupons out, or enlist friends or employees. Near by merchants may be willing to pass out some or put them in employee break rooms.
3. Again, depending on the type of service you offer, and your location. Placing a (nice) rack card in some of your higher end hotels, offering a discount to travelers staying at the hotel is good.
There are a few ideas to get you started. Hope they help!