Common Sense Methods to Determine Spa Pricing for Services
Common sense methods to determine spa pricing for services will serve you well in coming up with prices that both make you the amount of money you need to have to keep the business a float, and competitive enough to keep your clients coming back for more.
When determining pricing keep in mind all of your expenses for operating your spa business. Determine the amount of overhead you actually have per hour of every day. In other words, how much money do you have to bring in the door on average every hour just to pay the bills, not counting anything you need to take home as profit. Then determine how much you need personally as salary or wages in order to cover all of your personal bills and maintain a lifestyle that you would be comfortable with. Add the two together. Then determine the actual number of hours per day that you believe you can realistically be booked. Come up with an approximate minimum per hour rate that way, but be sure to add a little bit to it to take into account coupons and discounts you may offer. Then the next step is to do some comparison shopping. Check out the competition and see what they are charging. Make sure that you are in line with what the market will bear. You may be under pricing yourself. If that is the case, raise your base hourly rate a little bit, always remembering that it is easy to give a client a discount or temporary price reduction, but it is sometimes difficult to have a successful price increase.
When you determine your prices keep in mind the cost of acquiring clients. Marketing expenses can sometimes be the most expense part of operating a business. Come up with a marketing budget that includes all the advertising media you intend to use. That can be Yellow Pages, fliers, web site development and hosting, pay per click and search engine optimization, television commercials, radio spots, newspaper and magazine ads, and the cost of various events and open houses you may choose to sponsor.
Also don’t forget your taxes. When you meet with an accountant with your figures determine how much you will be paying in income taxes and FICA, and figure that in accordingly. Do your math carefully and you’ll have a very good idea of what you should be charging to keep both your clients and your self happy.
