Margins in the spa business are tight. It’s a labor intensive operation that also incurs inventory costs to support retail endeavors. Depending on the spa operating expenses, payroll rate, and overhead, an acceptable profit margin for most spas is 10% to 15%.
With such tight profit margins, the return on any capital investment must be significant. This includes investment in spa management technology. Whether you choose a cloud or web-based system or one that is installed on property, you’ll want to review the ROI over 3-5 years. Not only the cost of the system, but also the potential increased revenue opportunities as well as potential savings in time and resources.
These numbers are estimated based on real-world experience. For example, Marriott International saw online booking revenue at twice the figures estimated here when they rolled out SpaSoft Online Booking.
One of the key benefits of a highly-functional spa management software solution is the drastic reduction in the amount of time spend scheduling and managing appointments and resources.
When you look at these figures over 3-5 years, the increased revenue as well as time and personnel savings become substantial at well over $1M USD. While the tight margins in the spa business can cause any Spa Director to think twice about investing in a spa management system, these numbers illustrate how spa software can improve those same margins.
Investing in the right spa technology, and then investing in proper training for your staff, will pay dividends to your spa business.