Profit margins are also high. According to Cristina Ampil, hospitality and leisure analyst at PricewaterhouseCoopers, the average profit margin for the four types of spas, club spas, day spas, resort and hotel spas and other spas is 17.3 percent, with the highest profits coming from day spas. In my 15 years of consulting in spa and salon businesses, these are the top five things that surprise most new salon owners or spas. A luxury spa should have a profit margin of 10 to 15 percent, depending on your operating expenses, payroll rate, and overheads.
Today, many day spas operate with compensation rates of 50 percent or more, leading to minimal or no profit margins. You should check your financial health if you are an independent spa business owner. A good profit margin is when a profit outweighs expenses. If you're wondering what a good profit margin is, keep reading.
Do you want to increase the profits of the spa? Industry experts list the ways in which you leave money on the table. Munday says: “Identifying the commonalities of non-customers represents a huge long-term opportunity for hotel spas. Any new business has its challenges, but spas and beauty salons bring a whole new level of complexity to the company. Trent Munday of Mandara Spa, whose focus is on hotel spas, says: “The biggest immediate missed opportunity I see in most hotel spas today is the potential to tap into their existing customers.
With the rise of wellness travel around the world, spas are created for continued future growth and commercialization. Too many spas run out of their most popular products too often, resulting in missed sales opportunities and lower guest satisfaction. Lounges and spas are all over the news today, and customers have expectations, which are higher than ever, about the facilities. In today's hotel market environment, spas are no longer considered “pleasant to have” complementary facilities, but are established as a central element of the guest experience that not only drives demand, but matures as a source of untapped benefits.
So, we put the question to some of our favorite experts about how and where spas are missing out on earning opportunities and leaving money on the table.