How Sara the Spa Manager Saved Her Team from Being Fired
It is easy during an economic crisis to focus on cutting costs. The spa industry had long been rumored to be recession-proof. People always want to feel good and look good.
Sara the Spa Manager had been hoping since March that things would return to normal. When the Covid-19 outbreak started she was not overly worried. With more than fifteen years of experience in luxury hospitality, she thought she had seen it all.
During the 2008 global recession, she was in the US when 10 percent of spas closed. Her spa survived by focusing on new clients. They introduced a new line of cleansing products, hired a celebrity spokesperson, and created a special-priced massage, body scrub, and facial special that became the spas top seller.
This COVID-19 pandemic is different.
Governments have cut travel. Broad swaths of people cannot take vacations. As a resort spa they depend on clients from around the world. Her team is also international. They are not just employees and numbers they are like a family.
Guests’ care is their primary concern. The service is about nurturing people and making sure they experience results and optimal wellness.
Many of the therapists were attracted to the spa business because they received services that transformed their life. Whilst they loved having money it was not their primary driver.
The spa was a wonderful place. It provided a sense of escape from the outside world. Soft music, muted lights, sweet scents, retail products, organic teas, and biscotti. It was a home for many of the staff. Receptionists, therapists, and managers interacted at work and at play. Clients loved it!
Does your spa generate 20% or more in retail sales to service?
By June the mood changed.
Furloughs and layoffs started. Stress levels were elevated. Management let her know the clock was ticking and they may need to cut staff by 50 percent before the end of the year. If the numbers didn’t improve the layoffs were going to be permanent.
Being a spa manager in turbulent times can be overwhelming. “What can we learn to survive bad times?”
Sara wondered aloud. Every day she reads about more customers and spa professionals losing their jobs.
Now as the winter season approaches she is more stressed than ever. Re-opening standards vary wildly depending on the country. Changing travel requirements and border regulations are still limiting spa guests. Who can predict the consumer mentality as we head into the holiday season?
This places additional pressure on managers. No business in the world is insulated from COVID-19 issues.
Since everything is interconnected, the spa industry gets a cold when the tourism industry sneezes.
Global spas are part of a connected business ecosystem
Revenue fell from $400,000 to negative returns. Therapist bookings dropped from 15 per day to 3. Some treatment rooms have been empty for months.
As October started there was disarray. What can we do?
This morning she read a competitor with six locations in the country, is filing for Chapter 11 bankruptcy. They have been in business for 25 years. This is just one week after she learned another spa is closing its three locations and filing Chapter 7. They started their business 10 years ago.
Mandatory travel restrictions have reduced the number of tourists in the market. The spillover effect is Covid-19 has increased the percentage of local customers visiting the spa. This spells new opportunities.
Have we wasted the previous six months? There is new business out there. Are we sending emails to our existing clients? How do we engage? Successful spas are creating more content including video tutorials, social media posts, and increasing e-commerce activities.
People still want to maintain their health, well-being, and skincare routines during the pandemic. They are going to buy products and services from somewhere. Why not help them buy the products from her spa? In short, add more value to their lives.
Sara wondered, do we even know how much traffic comes to our website on a monthly basis?
These things seem to be helping some spas make more revenue even during the pandemic. Spas are doing online video consultations, sending products to customers at home, and training their staff so they develop new skills. Retail sales are also a bright spot. It provides more profit than services.
A retail WOW fact is that “If a client buys one product there is a 30 percent chance they will return. If they buy two products there is a 60 percent chance they will return. And if they buy three or more products they are locked in.”
When you combine this with the fact that retail products have a 50% higher profit margin it is no wonder that many leading spa executives are trying to figure out how to move more retail products now.
But has the staff been effectively trained to engage? Many spa professionals are introverts and not comfortable with the idea of selling. Engagement training may unlock their hidden strengths.
Homecare is in great demand. If therapists create more engagement they send clients home with more products. This is true in Asia, Europe, Africa, and the United States. This is an area worth exploring.
Spas reopen with an increase in consumer demand for homecare products
Sure cutting cost is understandable but at some point, we will come out of this pandemic.
If we implemented new measures we could develop confidence that one of these new tactics will pull us through. This is an opportunity to do some things we have delayed and not have too many eggs in one basket. Perhaps we can use this time to diversify our services, branding, and revenue streams.
How can we meet client needs in modern times? We must all keep trying to pivot, adapt, and overcome.
Even if we have to close all of our locations until 2021 what can we do now to empower staff for re-opening? This is as critical as wearing masks, gloves, and face shields.
When Sara brings her ideas to senior management they are intrigued. This could mean higher profits, increased competitive advantage, and improved customer service. The spa is contributing significantly to the bottom line. This can save jobs including Sara’s.
A global pandemic does not have to be a death sentence for your spa. It gives you an opportunity to step back, rethink, and review all segments of your operation. The economy will pick up again.
What you learn in this recession will leave you well placed to take advantage of that new day.
Norm
Latest posts by Norm (see all)
- 21 Award-Winning Luxury Spas – Visited in 10 Minutes - December 12, 2020
- How Sara the Spa Manager Saved Her Team from Being Fired - October 14, 2020
- Why 1000’s of Global Spa Executives Can’t Sleep at Night Since COVID-19 - April 9, 2020
