Spa Management Mini Education: The Importance of Running Your Spa Like a Real Business

No matter the industry – Every business owner struggles with applying the concepts of business management to their everyday operations. This is particularly true with industries that are associated with health and wellness, as often the individuals who open and run businesses such as spas do not possess a background in business management – most come into management or ownership as former aestheticians or spa professionals. Not running a spa like a business will assuredly produce a few things (even if its being run out of your home!):

Poor customer service
Inadequate and poorly trained/managed staff
Inability to build customer loyalty
Cash flow problems
Long-term failure

You probably know one or two business owners or managers who lack the basic skills to effectively manage their operations. Often, they are good in one area, perhaps marketing or staff scheduling, but are poor in other areas such as staff, cash-flow, or facilities management. As a result, unless the organization is so large that these managers’ weak points do not have company-wide effects (think Microsoft-sized), ultimately the problems listed above will arise.This is particularly true if the business relies on customer service to drive its sales, retain customers, and gain market share. The spa industry falls squarely into this category. If, as a manager, you do not have a good handle on business finances, personnel, training, and facilities management, the short-term problems will be minor headaches compared to the long-term problems of business failure, lack of customers, and/or financial issues.

One challenge that spa managers often struggle with is applying business practices while still maintaining the warm, friendly, personal touch that makes their efforts successful. It is a delicate balance between taking a spa and making it a great experience, providing professional and hygienic care, and making sure that the bottom line is met. More than most businesses, spa managers have to understand their clientele and what they are looking for, provide a “different” experience to stand out, and still run the place efficiently and make money.

That is the big dilemma in the spa industry today and as the industry intensifies, it becomes an increasingly looming issue. How does a spa manager successfully apply sound business management principles to their spa and still maintain the friendly, welcoming atmosphere that their customers crave? How does a spa director manage spa employees, be a good boss, and handle the everyday issues that arise in a highly customer-centric industry? How do you know if you are being an effective manager if “the wheels are not coming off right this minute”?

The answers to all of these questions are easier than they might first seem. In this chapter, you will learn about basic business principles, which will begin your educational foundation for future modules. This chapter will touch upon how to tailor those principles to your business and utilize tools that will ensure that your spa gives great customer service, has happy employees, and makes a profit. You will also learn tips on how to improve your bottom line without sacrificing quality. Finally, you will finish the chapter with an understanding of what a good manager is and does, as well as pitfalls that a spa manager should avoid at all costs.

Common Mistakes Spas Make

Placing the spa in an inappropriate space. While it is wise to try to use the locker rooms and aquatics area to complement the spa, sticking random massage rooms in the locker rooms never makes sense.
Forgetting about the spa. If you don't let members know about the spa they won't use it and it won't produce a profit.
Not having a plan. From creating the wrong-sized rooms to wet rooms that are sure to flood, every aspect of your spa needs to be planned out by a professional. Treatment protocols that don't appeal to your market and treatments that are so specialized that your staff will need expensive, ongoing training are also common mistakes.
Insufficient staffing. You wouldn't allow a front desk person who can't swim to manage your aquatics program, so why would you allow your general manager to manage your spa? While it is wise to allow your fitness management to oversee aspects of the spa, at the very least appoint a licensed professional with years of experience to manage the inner workings of your spa.
Expecting an instant profit. Spas are long-term investments and take two to three years to show any profits at all – with the average business showing strong earnings in 5-7 years. If your facility can't wait for your spa to turn a profit in a reasonable amount of time as opposed to overnight — this may not be the right business for you.