Whenever a person thinks about starting a spa business, the first impression that comes to his mind about saunas is about giving massages to people, but there are more complete stories. It is more like a treatment that allows people to escape from daily life stresses to a sanctuary of relaxation. So, running a spa is like providing clients a shelter to hide from daily life hassles. However, making a successful sauna requires effort and consistency. As a spa owner, you must understand the sauna business before putting in effort and consistency.
According to statistics, the market size of spas in 2022 was about $54.6 billion and is predicted to reach a market size of $168 billion by 2032. These statistics indicate that the spa industry will register a CAGR of 11.5%. This means this business will help an owner draw huge margins if the company is projected with the proper plan and execution. But a question that hits the mind of most sauna owners is what steps they must follow to run a successful business.
Before starting your business, you need to read about the case studies and do complete homework about saunas. You must understand what necessary steps big spa giants like Merdian Spa have taken during their business journey. Here are the 11 steps to help you make your sauna a successful business.
11 Steps to Successful Spa Business
Running a successful business depends upon many factors, such as market demand, location, business model, and management expertise. All these factors will allow you to follow the steps to grow your business and provide your clients with a good spa experience.
1. Understand Your Market
Before starting your Spa business journey, you must understand your market. Understanding the market assists you in defining your business’s success ratio. According to the statistics, companies that lack market analysis are 50% more likely to fail in 5 years. So it is important for you to take steps according to your target market. Understanding your competition and target audience clearly helps you know what you must do and avoid.
You have to make a deep analysis before starting your business. You can analyze different trends from social media platforms like Facebook and Instagram to understand your clients’ services. This analysis also helps you to comprehend the emerging trends in the spa industry. You can also watch your competition, visit them, and see what techniques they are using in their saunas. These visits allow you to identify the gap and give you a better picture of the spa business.
2. Know your Target Customers
To become a successful business person, you must think like one of your target customers. Understanding your audience gives you a better insight into your business model. In the changing scenario of the sauna, men make about half of the spa visits, but still, the spa is considered a women-centric industry. So, before starting your business journey, you must select the target audience and make arrangements accordingly.
You have to make an intelligent selection from the target audience. Your audience can be men, women, teens, toddlers, pregnant women, etc. Thus, selecting the right audience will help you to grow your sauna business.
This graph shows that in 2023, men’s visits to the spa increased compared to 2005.
3. Identify Your Spa Niche
You must select the niche after thoroughly analyzing the market and your customers. Your niche helps you to be different from the competition and allows you to fill the gap of a spa in your native place. For example, if you want to provide spa service to a male audience, your male customers become your niche. You will then plan all the strategies according to your niche, and you can also include grooming and waxing in the services.
Moreover, you can also select seasonal niches, such as in summer, where you can introduce tanning removal or sun protection. So, carefully selecting niches helps you grow your business while giving tough competition.
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4. Setting your goals
After completing your market research and analysis homework, you have to set your goals. These goals allow you to build your sauna and help you make the important decisions to complete your goal. Your goals help you create an exceptional spa that provides clients with a good customer experience. You have to break down your objectives into short and long-term goals.
You have to write down your goals on a sheet and make these goals a driving force. Some common goals that a business owner thinks are
- Expanding my team from 5 to 25 by the end of this year.
- Achieve 40 or 50 working hours of massage per week.
- Draw a profit margin of 20% by the end of this year.
After writing your goals, you have to assign deadlines to these goals so that you will be able to develop your single spa into a number of franchises after 5 years.
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5. Selecting Ideal Location
Your goals and market analysis are incomplete without selecting an ideal location for your sauna. People prefer to visit a place that is easily accessible to them and is located at a prime location. You have to select a location for the spa before going for the market analysis, as location helps narrow down your market and provides you with the perfect niche that people want in that area. You have to look for a location near
- Competition
- Having parking facility
- Type of area
- Transport infrastructure
- Demographics
After finalizing a location, you have to select the size of the area for your spa. So, you can attend to your customers freely without any space hassle.
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6. Calculating Startup Cost
Now, you have to make an important decision after finalizing your location and selecting your niche. You have first to ask yourself how much you will invest in opening your spa. Then, you have to break down your budget for different segments, like equipment, marketing, and discounts. Your initial investment involves:
- Registration of your spa
- Location rent
- Furniture and equipment cost
- Staff salaries
- Website
- Marketing costs
- Discounts
You have to narrow down your budget carefully so you will be able to fulfill all the necessities of your spa. Moreover, this calculation also gives you the estimation of your amount recovery in terms of profit margins. According to the statistics, the average profit margin in the spa business is 10% to 15%. But, initially, you must stay focused on providing services without considering profits.
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7. Financing your Sauna Business
To make your spa business successful, you have to calculate the initial cost of your startup. After initial budgeting, you have to make sure that you have a valuable source that helps you with the investment. Whether you make an initial investment from your savings or take a loan. You can also pitch your startup idea to some investors who will make an investment in your idea in exchange for equity. Having an appropriate financial institution helps you fulfill your dream and turn it into reality.
8. Hiring a Team
All the steps that you have to follow to make your spa successful are interconnected with each other. You have to make a small but dedicated team that is ready to give you mental support and provide your customers with a good sauna experience. Your team provides your customers with such exceptional service that your client says, “ A day at the spa is your way of thanking your body.”
Initially, you have to manage all the things by yourself so your team also feels motivated. You have to make sure that your team has a proper license for the spa.
Amidst discussions on the essential steps to owning a successful spa business, considering the accreditation and curriculum offerings of massage therapy schools becomes paramount, ensuring the recruitment of skilled and knowledgeable massage therapists to provide exceptional services to clients.
9. Creating Your Spa Service Menu
Whenever a customer enters your spa, they will ask you a prominent question about what services you are offering in your spa. So, it is more convenient for you and your receptionist to create a spa menu rather than telling each client about it. You have to ensure that your spa menu has the necessary information:
- Category of the treatments that you offer in your spa
- Description of each service you offer and how it benefits your clients
- Price of each service
- Offer any combo service to attract your clients
- Additional information like contact numbers, address, booking timing, etc.
You have to ensure that the price you offer on the menu is marketing competitive. Furthermore, you can also add your business logo to the menu. This logo provides your clients with a clear message of your dedication and passion for a good client experience.
10. Getting Your First Customers
After completing all the steps, your real challenge begins in the market. It is a challenge to find your first customer. If you have previous spa experience, you can contact your old customers, tell them about your spa, and convince them to visit your place. If you are new in the market, then you have to start attracting your clients by establishing contact in the community. You can tie up with hair salons and gyms, etc., so that they can easily promote your sauna business. Moreover, you can also introduce first massage discounts or other packages to attract new clients.
After giving a massage to your first clients, you can also ask them for feedback so that these clients feel special and help you make your spa a successful business.
11. Selecting a Spa Management Software
During the initial journey of your sauna, you have to work as a marketing manager, accountant, and HR manager all by yourself. All these responsibilities reduce your time and efficiency. So, you need the right Spa booking software like Wellyx that will help you manage your client appointments and schedules.
Such spa software also helps you manage your administrative tasks and marketing with special marketing tools. Thus, choosing the right software helps you in turning your spa into a successful business.
Bottom line
To start a spa and turn that spa into a successful business requires careful analysis of the market and customer behavior. So, for you, it is quite obvious to pay attention to the market and your target customer behavior to make your spa into a profitable business. Moreover, there are certain other factors as well that you also need to focus on during your spa journey. These 11 steps help you analyze the market and provide the necessary solution. So, you will put all your efforts under the guidance to make your spa business successful.
