Business Ideas | Small Business Ideas: How to Open a Spa

Wednesday, March 19, 2014

How to Open a Spa | How to Start a Spa Business

The term spa is associated with water treatment which is also known as balneotherapy. Spa towns or spa resorts (including hot springs resorts) typically offer various health treatments. The belief in the curative powers of mineral waters goes back to prehistoric times. Such practices have been popular worldwide, but are especially widespread in Europe and Japan. Day spasare also quite popular, and offer various personal care treatments.

Day spas can provide welcome relaxation for clients with stressful schedules, and without time for home pampering regimens. “Entrepreneur” magazine notes that day spas offer many services featured at spa resorts. Serve your regional market by analyzing your market’s demographic makeup. Visit your city’s Chamber of Commerce for market data, such as residents’ age and income levels, educational background and leisure time activities. Gauge your market’s sophistication and readiness for unconventional day spa services

Instruction:

Step 1

Establish your day spa business. Select a business structure with a Certified Public Accountant familiar with spa businesses. Business structures include sole proprietorships, limited liability companies and Subchapter S corporations. Meet with a commercialinsurance agent with liability background. Obtain a business license and required permits at your city or county clerk’s office. Ask your health department about a pre-opening inspection. Contact your state department of revenue regarding a sales tax license (See Resources).

Step 2

Lease a convenient and visible location. Find a building easily accessed via main roads, and with adequate customer parking. Obtain written zoning department approval before you sign a lease. Work with an interior designer to create a color scheme that complements your spa's soothing environment. Locate a designer through the American Society of Interior Designers (See Resources). Contact a sign-making company for building signage that describes your day spa and mirrors your interior color scheme.

Step 3

List your regional day spa competitors. Find day spas within your city and in surrounding towns. Visit each one discreetly, and observe the spa’s décor and overall customer service practices. Analyze spa service menus to identify nationally recognized services that are not available in your region. Examples include specialized massage modalities, aesthetician-provided facials and unconventional wrap treatments (See Resources).

Step 4

Publish a menu of day spa services. Create a spa services menu tailored to your regional market. Include professionally applied facials and scrub treatments, as well as signature applications such as custom-blended body scrubs. Hire a licensed massage therapist with experience in several modalities, including niches unfilled by other day spas. Consider aromatherapy and other body-enhancing treatments as well.

Step 5

Order your spa fixtures andequipment. Contact a national supplier of spa equipment that includes facial steamers, massage tables and other treatment-specific fixtures. Include specialty shower and sauna equipment if you plan to offer those services. Work with the supplier to ergonomically blend the fixtures into your day spa’s environment (See Resources).

Step 6

Hire outgoing and experienced staff. Find gracious and capable employees with prior experience at a hair salon or other personal service business. Ask community college cosmetology instructors to recommend qualified students likely to excel in receptionist and customer service roles. Locate a licensed massage therapist through the American Massage Therapy Association (See Resources). Find a licensed aesthetician through the Aesthetics International Association (See Resources).

Step 7

Host a luxury-filled grand opening. Welcome customers by pampering them with introductory spa package pricing. Conduct hourly spa accessories giveaways, and create a mailing list with the entry forms. Ask your massage therapist and medical professionals to speak on the benefits of stress management and relaxation. Advertise the event in local newspapers’ lifestyle sections and in health-focused magazines. Place tasteful invitations at non-competing hair and nail salons, fitness centers and upscale ladies’ clothing stores.

Things Needed

Business structure documentation
Insurance documentation
Business license
Local permits (if applicable)
Health department certificate
Sales tax license
Written zoning department approval
Lease
Building signage
Competitors' spa services menus
Your spa services menu
Spa fixtures and equipment order
Introductory package pricing sheet
Entry forms for grand opening giveaways
Ad rates and copy for newspaper ads
Ad rates and copy for health-focused magazines
Grand opening invitations

References (2)

Resources (6)

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Easy Tips and Ideas to Start Business

Although anyone can start a business, many people fail because of a bad product or improper research. If you want to start your own business, you can improve your chances for success before you even begin. In order to make your business successful, start strong and make sure that your idea will hold out for the long haul.

Have a Good Product

Ensure that you plan to sell something useful. Although you may think that your product is important or special, that doesn't mean the general public will agree. Ask friends, family and strangers what they think of your product. If they don't seem that interested, ask them why. With their suggestions, you can either improve the product or scrap the idea completely. According to Brad Sugars of Entrepreneur magazine, most small businesses fail because they sold a product that didn't have an adequate market. This also applies to small businesses that provide a service. A lawn-care business might be useful for part of the year in a northern state, but it is in-demand year-round in the south. Consider whether people will actually want to use your service and get constructive advice from those not afraid to give their opinion.

Research Local Businesses

Research local companies before starting up your own business. This will not only give you an idea of the amount of competition you will have, but it will also help you price your product or service. If you're looking to start a wedding photography business, you may find during your research that the market is over-saturated in your area. If not over-saturated, you should contact each business and ask them for a price list. Alter your prices so you can stay competitive with the competition in town. Researching similar local businesses will also help you decide where to locate your business location. Try not to start up a store or office close to another business of your type. If your small business is located away from similar business types, this will cause locals to choose you over businesses that are farther away from where they live.

Get Professional Advice

You may know someone who has started their own successful business. Ask him for advice and listen to his stories of how he started his company. You may gain useful advice on the good and bad ways to start a business. Local entrepreneurs can also introduce you to local product providers or advertisers that you may not have met without their help. Accept any advice with open arms, especially if the advice is coming from someone successful in the area.

How to Calculate Business Start Up Costs

Starting a business in no easy endeavor. It takes a great deal of research, perseverance and hard work. While sweat equity will make your small business more successful, you will most likely need real capital to get the business started. Before you start raising capital and/or investing your own funds, the first thing you need to do is determine the total start-up costs.

Step 1

Determine your costs of sales. For most small businesses this means inventory, the cost of raw materials, manufacturing equipment, shipping, packaging, and warehousing. However, not all businesses sell products. In this case, the cost of sales is primarily the direct labor involved in making the sale. For example, to open a small shoe business entails purchasing enough inventory ($10,000) to stock the store.

Step 2

Determine professional fees. Planning your business structure, i.e., limited liability corporation or general partnership, means hiring an attorney. There may also be the need to pay an attorney for help with establishing trademarks, copyrights, and patents. In this scenario, that puts total professional fees at an estimated $20,000.

Step 3

Determine technology costs. Technology can greatly reduce the cost of labor for small business if used effectively. Most small businesses require computers, printers, cell phones, website development, Internet access, software applications, information security, data storage, and outsourced information technology (IT) consulting. If the cost of technology is $10,000 to start, add an additional $5,000 a year for maintenance (hint: maintenance is not included in start-up costs).

Step 4

Determine administrative costs. This varies with business types and may include items such as business insurance, office supplies, product packaging, parking, rent, express shipping, desks, chairs, fax machines, phones, or anything else necessary to operate the business daily. A good estimate for start-up administrative costs would be $5,000 for the first six months.

Step 5

Determine initial sales and marketing costs. Now that you have your product, you need to let folks know about it. Sales and marketing costs generally include marketing materials for presentations, printing stationery, business cards, advertising, trade show events, and public relations. These initial sales and marketing costs can add up to $3,000.

Step 6

Determine the wages and benefits needed to secure a staff. This includes employee salaries, benefits, workers compensation, and payroll taxes. Let's put the cost of wages and benefits estimated at $20,000 for the first three months of business.

Step 7

Add all costs associated with starting the business for a total. Be sure to only include business start-up costs that will be incurred in the first three to six months of operations. For this example, the calculation is: $10,000 + $20,000 + $10,000 + $5,000 + $3,000 + $20,000 = $68,000.

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