Day Spas and Tanning Salons
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 30,900 day spas and tanning salons in the US provide personal care services to clients, including massages, indoor and sunless tanning, skincare treatments, and nail care treatments. Day spas and tanning salons also sell skincare and body care products, cosmetics, candles, vitamins and nutritional supplements, and other retail products. Some day spas also offer hair care services.
Competition for Services
Day spas face competition from other providers of massages and skin treatments, including hotel and resort spas, medical spas, fitness centers, independent masseuses, nail salons, and dermatology practices.
Indoor Tanning Health Concerns
Concerns over the health risks of using tanning beds threaten to reduce demand for tanning salons.
Industry size & Structure
The average day spa has 16 employees and generates over $842,000 in annual revenue, while the average tanning salon has 6 employees and generates about $275,000 in annual revenue.
- The spa industry in the US has about 21,500 locations, employs 345,000 people, and generates about $18 billion in annual revenue. About 80% of locations are day spas, with the remainder consisting of hotel and resort spas, destination spas, and medical spas.
- Tanning salons in the US have about 9,400 locations, 60,500 employees and generate about $2.6 billion in annual revenue.
- US consumers made 182 million visits to spas in 2023, according to the International SPA Association.
- Most day spas and tanning salons are independently owned and operated. Franchise locations of large chains account for less than 5% of industry revenue.
- Day spa chains include Massage Envy, Woodhouse Day Spa, and Bliss.
- Tanning salon chains include Palm Beach Tan, Planet Beach Tan, Hollywood Tans, and LA Tan.
Industry Forecast
Day Spas and Tanning Salons Industry Growth
Recent Developments
Jan 16, 2025 - Spas Bring Biohacking Techniques for Personalized Wellness: Report
- Spas are increasingly incorporating biohacking principles to offer clients a new level of personalized services, as niche practices enter the mainstream, according to a report in American Spa. Biohacking includes a range of procedures aimed at boosting performance, wellness, and longevity with technologies including cryotherapy, infrared saunas, and neurofeedback. The cryotherapy process exposes the body to extremely cold temperatures for short durations, which can have benefits like reduced inflammation, improved circulation, faster recovery, and enhanced mood. Spas are incorporating lymphatic support techniques into wellness practices to help reduce stress, promote relaxation, and restore balance to the body’s healing mechanisms by eliminating toxins and metabolic waste. Red light therapy is a non-invasive treatment with infrared light known to reduce signs of aging, improve skin health, and alleviate muscle soreness. Infrared saunas use infrared light to penetrate and heal the body. Neurofeedback and meditation pods can improve relaxation and mental clarity.
- Day spas and tanning salons will have to monitor minimum wage changes in 2025, as 21 states and 50 local jurisdictions increased their minimum wages, according to Chain Store Age. States with the highest minimum wage in the US are Washington ($16.66 per hour), California ($16.50), and New York ($16.50). Nearly 30 cities in California and seven towns in Washington will raise minimum wages in 2025, with Tukwila, Washington, offering the highest minimum hourly wage in the US at $21.10. According to the Economic Policy Institute, the minimum wage change will affect more than $9 million workers and raise pay by a combined $5.7 billion. Unchanged since 2009, the federal minimum wage is $7.25 an hour, and some 20 states, primarily located in the South and the Midwest, use the federal minimum as their wage floor.
- Day spas and tanning salons may be facing some changes with several tax and tariff proposals from president-elect Donald Trump, according to a recent report in Salon Today. Caroline Moss of Azarvand Tax Law listed key proposals for the industry to monitor such as tax-free tips, overtime pay exemption, import tariffs and equipment costs, and the extension of the Tax Cuts and Jobs Act (TCJA). The proposed exemption of tips from income taxes would be a significant change for employees who earn a base pay plus tips, resulting in thousands more in pay each year. The exemption of overtime pay from income taxes could make overtime shifts more appealing to workers and give salons more flexibility to extend their operating hours or accept bookings during peak times. Proposed tariff increases would likely increase costs across all imported equipment and supplies, including professional beauty products, tools and supplies, and furniture and fixtures. The extension of the TCJA affects a variety of corporate tax provisions including pass-through income deductions and capital expensing.
- Consumer confidence levels declined in December 2024, falling by 8.1 points from the previous month, according to The Conference Board. The Consumer Confidence Index was 104.7 in December 2024 from 112.8 in November 2024. Dana Peterson, chief economist at The Conference Board, noted that those remaining most confident on a six-month moving average basis confidence were those aged under 35 and those in the income category of over $100,000. Per Peterson, “The recent rebound in consumer confidence was not sustained in December as the Index dropped back to the middle of the range that has prevailed over the past two years.” Purchasing plans for homes decreased while plans to buy new cars and big-ticket items rose in December 2024 on a six-month average basis.
Get A Demo
Vertical IQ’s Industry Intelligence Platform
See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.
Build valuable, lasting relationships by having smarter conversations -
check out Vertical IQ today.