20 Nov 2017 | Digital editions, magazines, websites, e-zines, handbooks and contract publishing for the leisure industry

Spa Opportunities issue 280, 2017 is now out!


Spa Opportunities bloggers:

Liz Terry
Leisure Media

Kate Cracknell
Health Club Management

Katie Barnes
Managing Editor,
Spa Business

Lisa Starr
Senior Consultant,
Wynne Business

Anna Bjurstam
Raison d'Etre

Dieter Buchner
Founding Partner,
Urban Healing

Jean-Guy de Gabriac
Founder/ CEO,
Tip Touch Academie

Marisa Dimitriadis
Managing Director,
The Spa Consultants

Anni Hood
Kis Lifestyle Group

Jane Scrivner
Managing Director,
Jane Scrivner

Competition is everywhere

21 Feb 2013
by Liz Terry, CEO, Leisure Media
The spa industry faces new competition from pop-up operations offering spa breaks and experiences without the burden of capital costs carried by true spa businesses

Spas are expensive to build, and in creating them, owners, developers and operators either tie-up capital or have large debts to service.

So spa operations have to generate enough operating profit to clear a number of big hurdles: covering their direct operating expenses; in some cases contributing to overheads; then servicing debt; then maybe paying back some of that debt; and then, finally, creating an actual return. And all this before vital refurbishment is taken into account. There’s no doubt it’s an eye-wateringly expensive undertaking.

As a fixed-cost business, the upsides can be very attractive and this is one of the reasons the industry continues to thrive. However, there are signs new competition is coming down the line which isn’t shouldering the weight of this capital investment burden.

This January, I was browsing the usual new year diet and wellness magazine supplements and it was good to see spa figuring so prominently: "Take a spa break – top 20 places to get away," shouted one headline, but on closer inspection, only one of the 20 places in question turned out to be an actual spa. The rest were a higgledy-piggledy bunch of other options – basically where someone with imagination and a flair for PR had decided to grab a slice of the New Year good resolution pie.

There were hotels offering wellness retreats which were bringing in specialist spa chefs, star speakers on relevant topics and offering short breaks which involved hiking, spa cuisine and wellness lectures. There were others doing bootcamp spa breaks with celebrity trainers and mobile therapists offering sports massage in unusual settings – it was an attractive list of options.

But the one thing common to them all was the low cost base they were working from. The starting point was clearly, 'how can we create a 'spa' experience without having to carry the capital costs of actually building a proper spa and permanently employing spa staff ?'

While it’s great to see the wellness lifestyle gaining traction and a higher level of consumer awareness, I was left wondering where the spas were? Why weren’t they there, listed alongside the pop-up spa options?

We need to get seriously better at consumer PR and at marketing the value of our strengths if we're to counter the challenge presented by this kind of activity, because competition – and impressive competition at that – is everywhere and more of the same is on the way.

Tags: Spa Business  hotels & hospitality  spa & beauty  sales & marketing 

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