Do a few key services really well to reduce complexity, says McCarthy / photo: shutterstock/Lobachad
You’ve probably heard the joke...
Q: What’s the easiest way to make a million dollars in the spa industry?
A: Start with 2 million! It’s not easy to be successful in our sector for two reasons.
Firstly, these are complex businesses which require a lot of knowledge in diverse areas including leadership, customer service, wellness therapies, products and retail, finance, sales and marketing, software systems and more.
Secondly, they are low-margin operations which require large numbers of highly paid and well-trained employees. Most spas simply don’t make enough money to pay for the calibre of talent necessary.
This relationship between complexity and profitability is the greatest challenge spa owners and operators face. However, many have still found ways to create successful businesses. So how do they do it? Here are some strategies they use:
1 Partner Many successful spas can be found within hotel premises, where they can offload some of the complexity – relying on the property’s expertise and support in areas such as housekeeping, maintenance, marketing and food and beverage. In this synergistic relationship, the hotel also benefits from offering a great experience that builds loyalty and goodwill.
2 Size A larger spa with more treatment rooms has greater revenue-generating potential, leading to higher margins and supporting more experienced leaders. This can create an upward spiral resulting in increased success. Unfortunately, because spa margins are not high, there’s often pressure from investors to reduce size and smaller facilities struggle to make enough money to offset the fixed costs and turn a profit.
3 Scale Having multiple locations can allow a spa business to draw enough income from across its operations to fund an experienced central leadership team who can share their support and expertise in each business unit.
4 Specialise Spas can reduce complexity by streamlining their offering down to a few key services and building a reputation for doing those services very well. Many spas try too hard to keep up with all of the latest wellness trends and continually expand their menu to offer so much that it confuses customers and costs more in terms of stock and training.
5 Passion Much of the success of the spa industry is fuelled by the passion of our people. People who have foregone other, potentially more lucrative career opportunities, in favour of working in a more meaningful industry that gives them a deep sense of purpose. The spa industry would simply not be what it is today without these hard-working individuals who have a passion for wellness and for helping people feel at their best. One of the best ways for a spa operator to be successful is to create a working environment that attracts the best people and enables them to do their best work.
6 Experience Give your guests a great experience that they’ll want to have again and again and will want to tell all their friends about. The winning spas are those who really know their guests and give them exactly what they need.
7 Storytelling Give your guests a story to tell. The best spa is not necessarily the one with the most products or treatments. It’s the one that has a compelling story. And simple stories are easier to tell and to remember. Essentially, most strategies for successful spa operations work by virtue of their ability to reduce or offset the complexity of the operation. The key to success is the focus on quality, caring and above all, simplicity.
Jeremy McCarthy has worked in the spa industry for 34 years. As group director of spa and wellness for Mandarin Oriental, he oversees spa, wellness and leisure operations at 35 luxury hotels globally. Contact him with your views on Twitter @jeremymcc
Read more from this issue of Spa Business magazine
Sponsored: Highest French distinction for RKF's CEO
After receiving the highest civilian award for services to the French nation, Riadh Bouaziz, CEO of RKF Luxury Linen, reflects on his company’s many achievements and considers what lies ahead
Association focus: Thermal Heritage
Jane Kitchen finds out how two key associations – the European Historic Thermal Towns Association and the Great Spa Towns of Europe – are protecting and promoting the unique cultural relevances of Europe’s spa towns
Interview: Paul Simons
As he retires from the Great Spa Towns of Europe, the industry leader reflects on his long and esteemed career
Sponsored: New ways with water
Working globally with architects and interior designers allows Myrtha Wellness to embrace the latest trends in the international hospitality sector, as director Stefano Cattaneo explains
Sponsored: Cutting edge
Ara Patterson from Equinox Hotels talks about a partnership with
Gharieni that’s delivering ROI and innovative treatments for guests
Interview: Niamh O'Connell
What does Jumeirah’s first vice president of wellbeing have planned for the Middle East-based hospitality group?
Sponsored: Lasse Eriksen on contrast therapy
Contrast therapy is gaining attention for its healing effects. We ask aufguss and sauna expert Lasse Eriksen to share his views on the perfect experience
Nature spas: Tree of life
Lisa Starr discovers two retreats in Austria and Italy which base their wellbeing concepts on forests
Sponsored: Spirit of Excellence
Rupert Schmid and Pierre-Louis Delapalme, owners of Biologique Recherche, discuss the global rollout of its ‘Ambassade’ flagship spas
Sponsored: Outstanding performance
Bicester Hotel & Spa is working with Matrix Fitness to enable wellness guests to train like athletes with a unique offering
The MSpa Oslo series is a perennial bestseller in global markets. With innovative
engineering and premium performance, this completely portable spa line-up is expertly
designed to meet the needs of customers worldwide. [more...]
Contrast therapy, based on the alternation of hot and cold rituals, has become one of the
most valued practices in the fields of wellness and recovery. [more...]
Do a few key services really well to reduce complexity, says McCarthy / photo: shutterstock/Lobachad
You’ve probably heard the joke...
Q: What’s the easiest way to make a million dollars in the spa industry?
A: Start with 2 million! It’s not easy to be successful in our sector for two reasons.
Firstly, these are complex businesses which require a lot of knowledge in diverse areas including leadership, customer service, wellness therapies, products and retail, finance, sales and marketing, software systems and more.
Secondly, they are low-margin operations which require large numbers of highly paid and well-trained employees. Most spas simply don’t make enough money to pay for the calibre of talent necessary.
This relationship between complexity and profitability is the greatest challenge spa owners and operators face. However, many have still found ways to create successful businesses. So how do they do it? Here are some strategies they use:
1 Partner Many successful spas can be found within hotel premises, where they can offload some of the complexity – relying on the property’s expertise and support in areas such as housekeeping, maintenance, marketing and food and beverage. In this synergistic relationship, the hotel also benefits from offering a great experience that builds loyalty and goodwill.
2 Size A larger spa with more treatment rooms has greater revenue-generating potential, leading to higher margins and supporting more experienced leaders. This can create an upward spiral resulting in increased success. Unfortunately, because spa margins are not high, there’s often pressure from investors to reduce size and smaller facilities struggle to make enough money to offset the fixed costs and turn a profit.
3 Scale Having multiple locations can allow a spa business to draw enough income from across its operations to fund an experienced central leadership team who can share their support and expertise in each business unit.
4 Specialise Spas can reduce complexity by streamlining their offering down to a few key services and building a reputation for doing those services very well. Many spas try too hard to keep up with all of the latest wellness trends and continually expand their menu to offer so much that it confuses customers and costs more in terms of stock and training.
5 Passion Much of the success of the spa industry is fuelled by the passion of our people. People who have foregone other, potentially more lucrative career opportunities, in favour of working in a more meaningful industry that gives them a deep sense of purpose. The spa industry would simply not be what it is today without these hard-working individuals who have a passion for wellness and for helping people feel at their best. One of the best ways for a spa operator to be successful is to create a working environment that attracts the best people and enables them to do their best work.
6 Experience Give your guests a great experience that they’ll want to have again and again and will want to tell all their friends about. The winning spas are those who really know their guests and give them exactly what they need.
7 Storytelling Give your guests a story to tell. The best spa is not necessarily the one with the most products or treatments. It’s the one that has a compelling story. And simple stories are easier to tell and to remember. Essentially, most strategies for successful spa operations work by virtue of their ability to reduce or offset the complexity of the operation. The key to success is the focus on quality, caring and above all, simplicity.
Jeremy McCarthy has worked in the spa industry for 34 years. As group director of spa and wellness for Mandarin Oriental, he oversees spa, wellness and leisure operations at 35 luxury hotels globally. Contact him with your views on Twitter @jeremymcc
Read more from this issue of Spa Business magazine
Sponsored: Highest French distinction for RKF's CEO
After receiving the highest civilian award for services to the French nation, Riadh Bouaziz, CEO of RKF Luxury Linen, reflects on his company’s many achievements and considers what lies ahead
Association focus: Thermal Heritage
Jane Kitchen finds out how two key associations – the European Historic Thermal Towns Association and the Great Spa Towns of Europe – are protecting and promoting the unique cultural relevances of Europe’s spa towns
Interview: Paul Simons
As he retires from the Great Spa Towns of Europe, the industry leader reflects on his long and esteemed career
Sponsored: New ways with water
Working globally with architects and interior designers allows Myrtha Wellness to embrace the latest trends in the international hospitality sector, as director Stefano Cattaneo explains
Sponsored: Cutting edge
Ara Patterson from Equinox Hotels talks about a partnership with
Gharieni that’s delivering ROI and innovative treatments for guests
Interview: Niamh O'Connell
What does Jumeirah’s first vice president of wellbeing have planned for the Middle East-based hospitality group?
Sponsored: Lasse Eriksen on contrast therapy
Contrast therapy is gaining attention for its healing effects. We ask aufguss and sauna expert Lasse Eriksen to share his views on the perfect experience
Nature spas: Tree of life
Lisa Starr discovers two retreats in Austria and Italy which base their wellbeing concepts on forests
Sponsored: Spirit of Excellence
Rupert Schmid and Pierre-Louis Delapalme, owners of Biologique Recherche, discuss the global rollout of its ‘Ambassade’ flagship spas
Sponsored: Outstanding performance
Bicester Hotel & Spa is working with Matrix Fitness to enable wellness guests to train like athletes with a unique offering
Synergy – The Retreat Show, the global trade show for retreats, has launched a global research
initiative that will provide insights into the retreat sector from both consumer and industry
perspectives.
The Wellness Tourism Association (WTA) has published a non-regulatory global industry
framework designed to ensure the retreat market offers responsible experiences.
A new survey of UK and international spa practitioners shows that stress, burnout and
wellbeing concerns have caused one in three respondents to consider leaving the industry.
The UK's four Chief Medical Officers have published a refreshed edition of Physical activity
guidelines: UK Chief Medical Officers' report, updating the evidence that underpins the nation's
physical activity recommendations and placing greater emphasis on strength, balance, reducing
sedentary behaviour and, for the first time, supporting people taking weight loss medications.
Anna Bjurstam has left her role as Wellness Pioneer at Six Senses Hotels and Resorts and
launched a new wellness, longevity and “consciousness consultancy” called Wahayla.
Fairmont Cheshire, The Mere, has opened today (10 July) in the Northwest of England
with a
1,715sq m Fairmont Spa that has been designed using a ‘Wellness without Walls’
concept.
Wellness hotels generating less than US$1 million (€932,700, £785,200) – or 10 per cent of
total revenue from wellness and leisure – recorded the strongest RevPAR and TRevPAR growth
in 2025 across categories when compared with 2024, according to the latest Wellness Real
Estate Report by RLA Global, produced in partnership with P and L benchmarking firm HotStats.
Lefay Resorts, the portfolio of two luxury wellness properties in Italy, has added emotional
dance classes and group cold plunge sessions in response to market demand for social
connection.
The MSpa Oslo series is a perennial bestseller in global markets. With innovative
engineering and premium performance, this completely portable spa line-up is expertly
designed to meet the needs of customers worldwide. [more...]
Contrast therapy, based on the alternation of hot and cold rituals, has become one of the
most valued practices in the fields of wellness and recovery. [more...]
