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.

Indoor Tanning Health Concerns

Concerns over the health risks of using tanning beds threaten to reduce demand for tanning salons.

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.

Industry size & Structure

The average day spa has 14 employees and generates over $561,000 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 304,800 people, and generates about $12 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 124 million visits to spas in 2020, 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, Bliss, and Mynd Spa & Salon.
    • Tanning salon chains include Palm Beach Tan, Planet Beach Tan, Hollywood Tans, and LA Tan.
                              Industry Forecast
                              Day Spas and Tanning Salons Industry Growth
                              Source: Vertical IQ and Inforum

                              Recent Developments

                              Nov 9, 2022 - Trade Group Aims to Define Industry-Wide “Wellness Policy”
                              • In a presentation at the Global Wellness Summit in Tel Aviv, Israel in November, the Global Wellness Institute (GWI) highlighted the need for the wellness industry to create a “wellness policy” that can help governments, industry insiders, and the public work together to make wellness more accessible. The presentation also suggested how wellness policy could complement and enhance public health policy. The GWI’s research suggests that an $800 annual increase in wellness spending translates into a 7% rise in happiness levels and an increase in life expectancy of up to 1.26 years.
                              • XWELL - a family of brands providing health, beauty, and wellness services in airports worldwide – is teaming with robotic manicure firm Clockwork to bring robotic manicures to 28 of XWELL’s airport spas in 2023, according to Nail Pro. The Clockwork MiNiCURE is a fully autonomous, AI-powered robot that can paint nails without human intervention. After selecting nail polish, customers load the cartridge into the MiNiCURE machine, place their hands on a hand rest, say, “ready,” and the robot safely paints each nail individually.
                              • The wellness industry was enjoying a comeback as pandemic conditions abated, but inflation has since crimped many consumers’ finances and their ability to afford to splurge on wellness treatments and services. The pullback by customers of modest means has prompted some wellness businesses to focus on affluent clientele less affected by inflation and weaker economic growth. However, such strategies may be creating a backlash among consumers near the median of the income spectrum, according to the Global Wellness Summit’s (GWS) Mid-Year 2022 Trends Report. The GWS report suggested that a "new post-pandemic wellness consumer was rising and that one of their key traits was a fatigue with wellness as elitist hyper-consumerism." By shifting too far in favor of wealthier customers, wellness brands risk alienating potential clients looking for more affordable services.
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