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Spa Start Ups: Spa Management’s biggest threat?


My sources have been pointing to a fairly significant upswing in spa entrepreneurs coming back on-stream, and in this recent study I unearthed at Small Business Trends, a research report conducted in 2012 by Global Entrepreneurship Monitor (GEM) was highlighted.  It was interesting to see that the indicators I have been receiving, are in fact validated within this report.


“Entrepreneurial Optimism” is on the rise

There is an increasing population who believe there are good opportunities in starting a business.  Total Entrepreneurial activity (TEA) hit its highest level in years, showing diversity in age, gender, immigrant status and numerous other characteristics.  If America is the land of dreams, the newest dream is entrepreneurship. 

And why not consider starting up at home?  Home based business answer to 2 very important points a new entrepreneur might consider when opening a business, those being convenience and cost.  And its important to note that the majority of home-based businesses surveyed, now have employees.  

The traditional home-based ‘solopreneur’ is no longer flying solo

Home based businesses are moving into full fledged entrepreneurship with a complement of staff, right from the comfort of their homes and computer screens. Whether virtual, tangible, or a combination of the two, the owner of a day spa or massage clinic can run a lucrative small business at home, competing with existing businesses in all kinds of new and sometimes unrecognizable ways, presenting a significant challenge with their lower prices and super personalized services. 

Now, in addition to the current challenges spas face with the short supply of talented spa professionals, this resurgence in entrepreneurship is becoming a more pronounced contributor to the declining number of quality spa professionals that spas have to draw from.  Spas not only complete with each other in recruitment; they also now have to compete with this growing base of optimistic entrepreneurs, who we will see further into this story, may be more formidable then ever. 

GEM states interesting facts about home and business start ups

  1. 69% of American entrepreneurs start their businesses at home; 59% continue after they are established
  2. The median for starting up a business is $15,000. 
  3. Most start ups are funded by family and friends with a median of $5,000 being provided from any one source.  If it’s a home-based business, those family and friends often become employees
  4. More and more, entrepreneurship is spanning all age groups, with the young having the highest intentions to start a business; dropping in mid-career; and rising again at age 65 and up 
    • Spas2b observations definitely endorse this information.  Although our Spa Management program has a core demographic of females between the ages of 25-38, we now see registrants in their 50s and 60s coming onboard, with plans to open up a spa business after they retire
  5. There are fewer women entrepreneurs than men, at a ratio of 7:10.  Some points to consider:
    • Women entrepreneurs are more likely to start up a home-based business than men (72% vs. 61%)
    • Women entrepreneurs are also more likely to maintain a home-based business after 3 1/2 years than men (68% vs. 53%)
    • At an established business level, women are generally less profitable than men
    • Accompanying this, it was found that women have lower levels of intentions, less positive attitudes and lower growth aspirations than men (more fear-based)
    • Women that have discontinued businesses cite inadequate financing as the reason
  6. GEM states that the forecast in North American entrepreneurship is for above-average growth expectations; average innovativeness; and below average internationalization.  So one might translate this to read:  more start ups with some of those businesses being run by innovative entrepreneurs, but whom are missing opportunities for growth and globalization
  7. As well, first generation immigrants are bringing their entrepreneurial dreams to America, perhaps introducing authentic, original therapies that compete directly with our adopted renditions.

Entrepreneurship is both a consequence and a contributor

More start ups mean more failures, but it also means more successes, which of course spells increases in competition.  So what should all of this data mean to those who are considering spa entrepreneurship, and to those who are already entrepreneurs?


Future Entrepreneurs

Becoming an entrepreneur will change your life, so you may as well do what you can to ensure it will be a change for the better…right?

1.  Take the need for innovation seriously

It will not only force itself upon you, but it must also be fluent within you.  Innovation is all a business really has 

2.  Take a global approach seriously

Know that if you don’t have some form of global presence, you will eventually show up on the extinction list

3.  Take research seriously

Spend a lot of time researching the viability of your perceived opportunities and understand how they answer to what’s actually wanted now.  Here’s how to perform your SWOT Analysis 

4.  Now, trust yourself and your research

You can securely move from thinking small, to building a high growth, high profit, multi-faceted business, if you’ve done your research.

Existing Business Owners

Existing businesses have always had to deal with new and increasing competitive pressures, but to compound that threat, there is a new, concurrent trend developing alongside this ‘celebration of entrepreneurship’ trend, which is referred to as ‘Clean Slate Brands’, where Trendwatching.com states: ‘Heritage is the new baggage’… This trend has 3 drivers:

1.  ‘Lust for the New’

Consumers are now becoming immediately comfortable with an abundance of new players who are more nimble and laser-focused on what is important now

2.  ‘Instant Trust’

At a time where consumer trust is at an all-time low in business, the idea that consumers need recognizable, trusted brands and symbols to help them navigate through their choices, is being swept aside.  Unlike the older, established brands who may now be viewed as legacies by some, new entrepreneurs and their clean slate brands are gaining instant trust and therefore momentum, because of 4 main forces:

  1. ‘Immediately known’:  Even the newest of the new businesses are instantly rated by friends, family and consumer review sites, so they are trusted and adopted by consumers, immediately
  2. ‘Born clean’: New businesses are assumed to be pure, so consumers believe that they live by ‘new’ business values, including higher environmental, ethical and social standards; which breeds trust
  3. ‘Simple truth’: Secrecy and competitive advantage have been replaced by transparency, ease of understanding, and therefore trust
  4. ‘Future faith’: Because they are so new, it is believed they cannot have sinned yet, so they are considered trustworthy to continue to act correctly and in the best interests of the consumer.

3.  ‘Open Operation’

Clean slate brands offer two-way, participatory connections with consumers in a way that older brands do not, which makes customers feel more in control and that they have a meaningful relationship with the brand; both basic human desires.

No one ever said it would be easy, but for those established business, these changes are only threats if you aren’t aware of them, or don’t act upon them. 

Is it really time for the saying

‘Out with the old and in with the new’

to take hold in the spa industry? 

You decide, and let us know – we’d love to hear from you.


Attention:  Spa Owners and Managers 

Get your Staff Contracts in place and

avoid ‘Entrepreneurial Optimism’ from walking away with what’s yours,

with our ‘Non-Compete’, ‘Confidentiality’ Agreements, and many more.

About Leslie

Spas2b Inc. is a full service Spa Development company, specializing in Online Spa Management Distance Learning Courses, Spa Business Manual Instant Downloads & Resources, and Spa Consulting Services.
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