Med Spas
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 8,800 medical spas offer cosmetic medical procedures and traditional spa services under the supervision of licensed healthcare professionals. Operators provide a variety of aesthetic, minimally invasive, and non-invasive procedures that enhance physical appearance. Popular treatments include dermal fillers, neuromodulators/Botox, laser treatments, microdermabrasion, and chemical peels. Medical spas employ trained staff, such as registered nurses (RN), nurse practitioners (NP), physician assistants (PA), and aestheticians, to administer procedures.
Medical Complications
Medical procedures naturally come with some risk of complications, and those performed by nonphysician personnel in medical spas have elevated risks.
Government Regulation
Because medical spas are technically medical practices, operators are subject to regulatory oversight by state medical boards, which determine what constitutes a medical procedure, who can perform the procedure, the staffing ratio of physicians to non-physicians, and what qualifies as on-site/off-site supervision.
Industry size & Structure
The average medical spa operates out of a single location and generates almost $2 million annually, according to the American Med Spa Association. Single-location medical spas employ an average of eight workers and generate just over $121,000 annually. Multi-location operators employ an average of 16 workers at the primary facility.
- The medical spa industry consists of over 8,800 operators that employ 70,000 workers and generate about $15 billion, according to the American Med Spa Association.
- The medical spa industry is fragmented; over 80% of firms operate out of a single location. Multi-location operators average six locations.
- Two-thirds of medical spas have a single owner. Over 60% of medical spas have an owner who is not a physician.
- Large firms include Ideal Image and Laser Away.
Industry Forecast
Med Spas Industry Growth
Recent Developments
Nov 18, 2024 - Higher Employment, Lower Labor Costs
- According to data from the US Bureau of Labor Statistics, employment for med spas grew while labor costs fell in September 2024 compared to a year ago. Employment by other personal care services, including med spas, increased by 3.9% in September 2024 compared to a year ago. The industry continues to rebuild its staffing levels post pandemic. Employment levels for the industry are 13% higher than pre-pandemic levels. Average wages for nonsupervisory employees at other personal care services fell 2.4% in September 2024 year over year, reaching $24.81 per hour, according to the BLS. Prices for personal care services were 4.5% higher in October 2024 compared to the previous year and up 0.2% from the previous month, according to Consumer Price Index data.
- The US Chamber of Commerce and Q3 2024 Metlife Small Business Index, which measures small business owner confidence, reached its highest score since Q1 2020 as small business owners see signs of improvement in the economy. The score hit 71.2 in Q3 from 69.5 in the previous quarter due to a boost in the share of small businesses that say the economy is in good health. Two-thirds of small businesses report their business is in good health, and 68% say they are comfortable with their cash flow. Small businesses report challenges with inflation (56%) and revenue (28%). According to MetLife EVP Bradd Chignoli, “As we head into the final quarter of 2024, it is encouraging to see the continued optimism of small business owners driving the Index score to near pre-pandemic highs.”
- The US med spas industry is projected to grow at a CAGR of 6.3% between 2024 and 2028, according to a forecast for the “Other Services Sector” from Inforum and the Interindustry Economic Research Fund, Inc. The expected growth rate is faster than the overall economy‘s anticipated growth. The report noted that consumer spending, along with expenditure by businesses, drives the other services sector. Consumer confidence is expected to improve in the forecast period, which bodes well for the other services sector. Factors that continue to limit consumer spending are lower consumer sentiment levels, higher interest rate levels, and elevated price levels. On a positive note, inflation is subsiding, which supports a moderate increase of real disposable income by about 1.9% in 2024 and 2.4% in 2025.
- US spa industry revenue saw another solid year in 2023, increasing 6% to $21.3 billion from $20.1 billion in 2022, according to data from the International SPA Association (ISPA) in the latest edition of Pulse magazine. The 2024 ISPA US Spa Industry Study released the “Big Five” statistics from the study: total revenue, spa visits, number of locations, revenue per visit, and industry employment. The study also includes compensation data, service offerings, average prices, and spa location distribution in the US. The number of spa visits grew in 2023, increasing from 181 million to 182 million. According to the study, revenue per visit climbed 5%, reaching $117.50. The average price per spa service grew 5% to an estimated $120, with all spa services seeing upward movement year over year. The average price per facial, for example, increased from $104 in 2019 to $130 in 2023 while the cost per body treatment grew from $114 in 2019 to $163 in 2023. Overall industry employment also increased by 2.6% in 2023 to 370,100.
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