There’s No Business Like Spa Business

With some rec centers and health clubs adding or converting space for spas, how do you plan a successful place for pampering?

By Jenny E. Beeh

Once the decadent relaxing playgrounds of the rich and famous, spas are now popping up everywhere—including rec facilities—and catering to everyday people in search of a little pampering.

The spa facilities at Boar's Head Inn, a Sports Club,
Resort and Spa in Charlottesville, Va.

"It's a stressed-out world," says Bob Calvo, vice president of construction for Town Sports International, based in New York, which owns 120 health clubs including Boston Sports Clubs as well as its counterparts in New York, Philadelphia and Washington, D.C. Stress relief is what spas are all about.

"Spas are a major growing trend in the United States," adds Francis Acunzo of Sage Spa, a consultant specializing in the spa industry and owner of two spas located in health clubs. "One of the largest growth segments is the club spa category—spas within or part of health and fitness clubs." He sees health club members as a good match for spas. "There's and obvious symmetry between the markets," he says.

Proximity helps, too.

"The No. 1 driving factor in the purchase of spa services is convenience," Acunzo says. "[With health clubs], you have a captured audience.

And that audience increasingly knows what it wants.

"The spa industry needs to keep the consumers in mind. Qualitative research indicated that as the industry continues to grow, there is some concern that standards could slip, or that the human component could be taken over by a cold, corporate way of doing business. The industry as a whole has to be careful not to lose sight of the customer and their priorities and of the fact that they are in the "touch" business. They need to ensure that the consumer receives an appropriate experience and that the authenticity and credibility of the industry is maintained."

Source: The International SPA Association's 2000 Spa Industry Study prepared by PricewaterhouseCoopers

"Consumers are driving the demand for spas, and they are becoming more and more educated about the value of a spa experience," says Lynne Walker McNees, executive director of the International SPA Association (ISPA). "When someone goes to a health or fitness center they want to do more than workout—they want a one-stop shop, a place where they can also get a massage or a facial. People have less time, they want to spend their time wisely—health and fitness centers adding a spa component is a perfect fit for busy people."

Back in the day, before day spas

In general, spa-type spaces in rec facilities have had humble beginnings, usually as a small room used for massage often in or adjacent to the locker rooms.

"That was it for 'spa' services," says Dan Meus, principle of Graham/Meus, Inc., an architectural firm based in Boston that has designed rec facilities (some with spas) all over the country. Such rooms were hardly roomy, usually 120 square feet, space enough for a massage table and maybe a vanity table. "Not a lot of thought went into it," he adds. "Nothing about mood—you just went there to get rubbed down."

Top: A view of the Boar's Head Inn grounds
Bottom: The Boar's Head Inn spa reception area

But all that's changed over the past half-decade or so. Now spas have their own unique—and expanding—space.

Spas designed for health clubs and rec centers can be tricky because a good spa must walk a thin line between being its own separate oasis-type world—crucial for the whole relation experience to work—and a seamless integration with the rest of the club: It has to be part of the whole club yet must be allowed to have its own decadent personality.

"You want to integrate it with the whole workout experience," Calvo says. On the other hand, spa space must remain special. "It has its own environment," he says. "Find a way to differentiate each area, integrate flexibility into the design. But you don't have to be totally separate from the core business. To me, that's key."

Separate yet integrated is only one of the major design considerations. Creating the right spa atmosphere is another.

With relaxation as one of the highest priorities, think about the five human senses when it comes to complete design. For example, muted, toned-down lighting and soundproof walls can separate the spa from the rest of the building as well as create a peaceful atmosphere.

"That's very critical," Meus says. "If you can hear the music pumping from the aerobics studio that would be terrible."

And the heating/ventilation/air conditioning systems should be separate, too. While temperatures in the mid-60s (degrees F) are considered normal in a workout room, warmer temps in the range of 72 to 75 degrees are much more comfortable for bare skin. Spas also need to be designed with larger ductwork and larger grills to slow down the air so it feels softer. The ventilation system will also be handling odors from chemicals and solutions and therefore must exhaust to the outside, similar to a toilet room.

"Those are little things you need to pay attention to," Meus says.

Designing for privacy is also important. While communal-type spa space was typical in the 1970s, Calvo says, clients today crave seclusion.

Make a plan

A spa is a distinct business, and by no means a small undertaking.

Sage Spa is a full-service day spa adjacent to the
Boston Sports Clubs Wellesley Fitness Center

"It's on the level of adding a restaurant to your facility," Acunzo says. "It's not a department; it has to be seen as another business you're investing in—though integrated as much as possible."

One of Acunzo's spas, Sage Spa, is a 1,200-square-foot facility attached to the 55,000 square-foot Boston Sports Clubs Wellesley Fitness Center.

Many clubs decide to take existing internal space that is underutilized—like racquetball courts—and convert it into a spa. All and all, experts estimate it might cost anywhere from $100 to $250 per square foot to build your spa, with the process taking about a year, from the planning stages to the first facial.

Whether you are converting old space or adding new space, one of the selling points for starting a spa at a health club is the fact that it seems like the club's members will translate into instant spa customers. Maybe.

"I wouldn't build a spa without a minimum of 2,000 female adult members over 30," Acunzo says. The fewer members you have that fit your spa demographics, the more you will have to spend to market yourself to the general public.

Of course, a good business plan calls for outside customers as well.

"For a spa business to be successful, it has to tap into a market that is larger than the member population," says Hervey Lavoie, an architect and president of Ohlson Lavoie Corporation based in Denver, which has designed recreation facilities all over the world. "There's just not enough traffic. A spa also has to be accessible to the outside public." As a rule of thumb, he estimates that about 50 percent of the spa's business will be nonmenbers.

Which is why a spa should have its own outdoor entrance to the street as well as an entrance inside the club.

Sage Spa

"You want members constantly exposed to that opportunity," Lavoie says.

Planning exactly what opportunities a spa will offer is also a key business decision. Some experts say there's no need to attempt elaborate or exotic services from the get-go; you can always add more later.

"The first thing you need to decide is if you're going to have hair styling," Lavoie says. Again, you have to be careful of properly separating spaces. Hair styling tends to be a high-energy, high-odor area, very different from a massage area, for example.

"Stick to the basics," Acunzo advises. "Think facials, massages, manicures and pedicures. Focus on the highest quality of services possible. Start small. I don't recommend starting with hair first—that's a whole other business: the beauty business."

Other treatments like acupuncture and aromatherapy cross the line and tend to fall under the alternative medicine category, a whole other undertaking.

Whatever services you start with, always remember, atmosphere counts—a lot. It's not just the warm towels or the rainforest music but the combination of everything you offer.

"It's the entire experience that makes it a quality experience," Acunzo says. From the warm greetings clients receive from the moment they walk in the door, supreme customer care is essential. Spas are very much a service industry.

"A good spa creates its own ambience," Lavoie says. "Something distinct and more relaxing. There's a passage, a gateway into the spa that sends a message."

While creating a spa design to have access to member locker rooms can be good move for convenience—and marketing strategy—Lavoie warns that you should be careful when designing that transition. Locker rooms and gyms tend to be active, noisy, high-energy spaces.

Sage Spa

"That's contrary to the experience you want your spa to be," he says. It's OK if convenience prevails, just control the transition.

Spa spaces continue to grow in health clubs and rec centers, in general ranging from about 600 to 1,500 square feet. In contrast, quintessential destination or resort spas are much, much bigger.

Of course, site plans vary significantly, but typical spa elements can include one or two massage rooms, two or three nail stations, one pedicure station, a facial room, a body treatment room, a separate bathroom and shower. Many club spas are located next to the locker rooms, also providing access to the club's steam room and sauna.

Décor-wise, upscale materials, serene color schemes, subdued lights and fancy fixtures are common in the more passive spa spaces in contrast to the rest of a club, which are usually bright and active spaces.

Obviously spas are different design creatures.

Which is why Acunzo recommends contracting an architect who specializes in spas. Often, he says, people make a mistake by turning back to the architect who designed the entire sports facility, who may not have any experience with spa design.

Acunzo also recommends considering doing a joint venture with a local spa or leasing the space to a local spa.

"Every time we've had someone build a spa, they think they will run it in-house but end up renting it out to someone in the spa business," Meus adds.

If you do decide to take the plunge, don't overlook the challenge of finding quality service providers like technicians and therapists.

"Labor is our business's biggest problem," Acunzo says. "There's a labor shortage."

Before you make any big plans you would be wise to test the labor market by running ads and conducting interviews.

Up and running

Adjacent to the Fitness Etc. Fitness Center for Women in Boston, Amyris Day Spa provides full spa services including manicures and pedicures, massage, wet and dry body treatments, facials, waxing, and makeup. Consisting of about 700 square feet and two rooms, the spa has a private entry as well as direct access to the fitness center's locker rooms.

"It's a totally different atmosphere," says spa owner Maura Hegarty, comparing the spa environment to the rest of Fitness Etc. Hegarty estimates that about 85 to 90 percent of her clients are members of the club.

Adjacent to Fitness Etc. Fitness Center for Women
in Boston, Amyris Day Spa provides full spa
services, including manicures and pedicures,
massage, wet and dry body treatments, facials,
waxing, and makeup. The spa has a private entry
as well as direct access to the fitness center
locker rooms.

"It's basically one-stop shopping for someone who's working out at the club," she says. "Everyone's always running, running to another [stop or errand]. Here they can really relax."

Amyris opened in October 2000.

"It's an ongoing learning experience," she says.

Head first

On a larger scale, the Boar's Head Inn, a 573-acre country resort in Charlottesville, Va., opened a 5,000-square-foot spa connected to its 171-room hotel in the spring of 2001.

The spa facilities at Boar's Head Inn, a Sports
Club, Resort and Spa in Charlottesville, Va.

"It's a very popular amenity for hotel guests," says Jorg Lippuner, general manager of the Boar's Head Inn, which recently underwent a two-year, $12-million restoration. "It was time for a facelift."

A facelift, both literally and figuratively, it seems.

The new spa offers private dressing, steam and sauna rooms for men and women, an outdoor swimming pool with Jacuzzi, a quiet room for meditation that overlooks a pond, and a therapy center with four treatment rooms and one wet treatment room with a hydrotherapy tub that can be rented for private soaks. Treatments available range from body massage therapies (including reflexology, aromatherapy, stone and cranial sacral) to hydrotherapy as well as esthetic treatments such as botanical wraps, facials, salt glows, manicures, pedicures, hair removal and makeup application.

"Spas are in demand," Lippuner says, noting that with the trend toward shorter vacations, people have limited time to relax. "Anything you do must be quality. People come in for the experience, and once you have that, word spreads," he says.

The spa is also near the resort's Sports Club, which offers a fitness center, swimming pools and tennis courts to about 900 members as well as hotel guests. The 18-hole championship Birdwood Golf Course is also part of the complex.

The centerpiece of the resort is an 1834 gristmill, the historic theme of which was carried over in the new spa's design along with the resorts English country motif. The spa was designed to resemble an elegant farmhouse complete with active spring in the spa's main foyer.

Lippuner estimates that about 55 percent of the spa's clients are hotel guests, while about 20 percent are members of the Sports Club and about 25 are local residents.

Lippuner's advice on spa design?

"Make sure you have ample space," he says. "Think bigger than what you are in the process of thinking. In our case, at times, we wish we had eight [treatment rooms]."

By the Numbers
How big is the spa industry and how fast is it growing?

The following findings are part of the International SPA Association's 2000 Spa Industry Study prepared by PricewaterhouseCoopers.

Spa locations There are an estimated 5,689 spas throughout the United States. The largest spa category is day spas, accounting for more than three-quarters of locations. Resort/hotels are the second largest group, followed by club spas, medical spas, mineral spring spas, destination spas and cruise-ship spas. Geographically, the distribution of spas generally reflects with the distribution of the U.S. population.

The number of spa locations has been growing rapidly, doubling in number in the last five years.

Spa visits There were about 90.7 million spa visits made in the United States in 1999. About 64 percent were to day spas. Club spas and resort/hotel spas receive the next largest numbers of spa visits.

Demand is the driving force behind the tremendous growth of the industry. Spa demand grew 60 percent between 1997 and 1999. Club spas saw the largest increase in demand at 132 percent—more than double the industry average.

Revenues In 1999, the spa industry amassed about $5 billion in revenues. The largest sources of revenue for the industry are treatment rooms, beauty salons and retail.

With revenues growing rapidly for both the industry as a whole and for individual spas, total industry revenues surged 129 percent between 1997 and 1999. In the same time period, individual spas experienced an average annual increase in revenues of 28.3 percent in the United States and 26.3 percent in Canada.

Employment An estimated 151,000 people are employed by the U.S. spa industry. About 69 percent of these employees are full time. Employee wages and salaries totaled about $2.4 billion in 1999.

The spa industry saw a doubling in the total number of employees between 1997 and 1999.

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