2022 Spa Profit Boosters

Are you looking for 2022 spa profit boosters?

If so, you’re far from alone: when it comes to looking at their business in regards to the upcoming New Year, most spa owners use December as the time to decide which growth initiatives should be on the docket for 2022.

Here at Kirsten Foss Coaching, the most common New Year-related growth initiatives I hear about include:

• New service launches
• New product launches
• Adding new team members
• And, last but certainly not least, finding (or renovating) a new spa space to expand your biz into

Now, all of those initiatives do sound exciting… and potentially pricey and time-consuming! And, for many spa owners who feel tapped out both monetarily and time-wise, setting their sights on a new growth initiative for 2022 just seems out of reach.

But what if I told you that you didn’t need to add anything new to your 2022 spa business growth strategy to still generate more earning potential?

Let’s dive into how you can work smarter, not harder, with 2022 spa profit boosters:

The Benefits of Boosting Your Spa Profits

It’s human nature to look at what to add to your biz but optimizing your current services, retail, team and business systems is really what puts you in the sweet spot of generating more profit.

As entrepreneurs, we’re really good at ideas; heck, in my spa owners-only Facebook group, Spa Business Mastery, we chat about ideas all day long! What the bulk of spa owners find that their weak point is, however, is putting those ideas into action. (It’s even true for me, which is why I have a team behind me to act on my ideas!)

While stacking more and more onto your spa business is likely your first thought for how to smash your revenue ceiling, at multiple points during your journey as a business owner you’ll have to pause and optimize your existing systems and structures. After all, how can you add onto your existing revenue if the systems that are in place are outdated, not documented, or even ineffective?

Let’s jump into which profit boosters can fix those problems (and put you in the right place for adding products, services, or new spaces in the future):

Do Your Cost-Per-Treatments

Have you been crunching your cost-per-treatments?

If your answer is an immediate “Yes!” then here’s a follow-up question: have you been including all your labour costs in your treatments?

For many of you, I know that answer will be, “No.”

If you’re basing your cost-per-treatments simply on the pricing sheet that most skin care lines provide, you’re missing out on a large chunk of the money you’re really putting into each and every treatment.

To optimize your cost-per-treatment, ensure that you’re including:

• Total cost of supplies (including Q-tips, gauze, tissues, and other sundries)
• Labour costs (not just commission, but any required insurance or related costs as well!)
• Overall admin (reception, rent, hydro, etc.)

Anything that factors into your spa running properly should be added to your cost-per-treatment! When you work backwards, you can determine what your cost-per-treatment actually is… even down to the minute!

If, once you’re done, you realize that your cost-per-treatment is higher than you thought, remember that you’ll also likely need to strategize a new compensation format; if this analysis stresses you out, don’t hesitate to reach out to me for a Single Coaching Session! We’ll take a look at your unique situation and create an action plan that works for you.

Do Your Sales and Spa Metrics Analyses 

If you’re not tracking your sales and spas metrics you’re leaving money on the table.

Why? Because:

• Numbers don’t lie; even if you feel like a certain product or service is selling well, once you crunch the numbers that may not be true
• You’ll be able to determine key metrics like first-visit retention, what your highest-ticket treatment is, and which of your staff are performing the best

If you know where your business stands in relation to the average spa industry benchmarks, you’ll know which areas you’re excelling in and which you’ll need to whip into shape in 2022. 

Back when I was a spa owner, when I first learned what the spa industry benchmarks were I realized that my spas retail-to-service ratio was an abysmal 9%! The industry standard is 30%. If I hadn’t gotten that benchmark as a comparison, I never would have known that anything was wrong… and would have been missing out on massive profits! After all, you can’t fix what you don’t know.

I highly recommend tracking your sales and spa metrics both monthly and yearly in order to analyze patterns in your biz to course correct quickly.

Do Compensation Comparisons

As a whole, the spa industry is heading towards an hourly payroll vs. a commission-based system for teams.

Meaning? If you’re paying straight commission, it’s time to start getting your payroll under control with an hourly pay scheme instead!

To make this transition successful, I recommend:

• Developing a payscale that increases as performance increases
• Making performance expectations clear on both sides
• Providing monthly 1:1 coaching to support all team members in understanding spa metrics and how they can affect change to theirs
• Keeping communication open

Do Reevaluate the Necessity of Renovations (or Moves)

Renovations are both a costly upfront expense and a costly ongoing expense. For spa owners who may have been grappling with sales in 2022, upgrading to a new or “better” location may not be the fix-all that you’ve been looking for.

Instead, sometimes expanding your hours or team can be more effective. I had a client a few years ago, for example, who thought that her only option was to expand physically… when really hiring on new team members to handle evenings and Sundays fixed her capacity problem much more inexpensively!

Leverage 2022 Spa Profit Boosters for Your Biz

Want to identify your spa profit leaks to make 2022 your most profitable year yet without adding products, services, team members or locations? You’ll definitely want to check out my Spa Profit Maximizer VIP Day!