by Lisa M. Starr, Community Ambassador, GramercyOne
While the U.S. spa business has faced many challenges recently, it is still looked upon as the model to aspire to in other parts of the world, which I was reminded of on recent visits to spas and conferences in South Africa, Brazil and China. Seeing current practices in these countries reminded me of how hard we have worked in the last 15-20 years to create viable spa businesses.
All three countries have active spa markets, albeit in various stages of their growth cycle, and brought back memories of the good old days in the U.S. It’s not that these markets have not been affected by the economic crisis, but the number of spas per capita and expectations of the client base have not yet reached the levels we were seeing stateside.
South Africa has the most sophisticated spa market of the three; with a vibrant spa association with almost 300 members, and the country is well represented in both the day and hotel/resort spa categories, with the addition of the safari spa option. Many spas offer advanced skincare, global spa brands, wellness options, and massage and body services; very few are attached to salons. Day spas here are beginning to offer medical services such as IPL, Laser Hair Reduction, slimming body treatments and microdermabrasion, but very few are providing injectables or services performed by a medical professional. Having once been the province of the British Empire, South Africa has a well-defined legal and licensing system which is observed by the citizens.
The personal care market in Brazil is broken into several different areas; salons, skin care clinics (approx. 4000), and spas (approx. 1000), and the day/resort/destination categories are all represented. Beautifully appointed resort spas are mostly located in and about Rio de Janeiro and other cities near the ocean, while day spas are found in all major cities. Many of the spas have been opened by entrepreneurs from other industries, who may have little understanding about how to create a profitable spa venture, and they are beginning to realize there is more to the story than just building a good-looking facility. There are a few active spa franchising operators, who are taking great pains to create viable brands. A large university in Sao Paulo has just created a wonderful spa facility to train therapists, who receive a four year bachelor’s degree which includes study in areas such as nutrition and psychology, but there is no licensing regulation and few therapists throughout the country are actually licensed. Brazil has a developing medical tourism business, with 25 JCI accredited hospitals, and is especially known for plastic surgery, currently performing the second-largest number of procedures annually, after the United States.
The spa market in China is, like everything else in China, growing very quickly. Chinese spa operators are quick to recognize their shortcomings and are working hard to bring their spas up to international standards. The number of viable spa businesses is difficult to define; there are at least three national spa associations, one of which is endorsed by the government, but there are many small spas that do not belong to any of the associations. One of the panel presentations at the Spa China Summit discussed having the government mandate the definition of “spa” so as not to confuse consumers, something we still face here stateside. The large hotel and hospitality groups are opening mega-spas in the large cities, especially in the east such as Shanghai, Beijing and Guangzhou, but day spas are proliferating elsewhere. There is currently no recognized licensing for beauty therapy, and very few formal beauty schools. Few, if any, spas are performing aesthetic medical services, although some do offer TCM treatments. China is currently listed as performing the second-highest number of plastic surgery procedures in the world, although on a per capita basis it still ranks far below both the U.S. and Brazil.
It is worth noting that all three of these countries pay their therapy staff a monthly salary, which is standard in most of the world, with the exception of the U.S. In some cases the salary is augmented by a small commission on service sales; retail commission is often low or non-existent (making retail sales non-existent as well!). Monthly salary/draw is variable, but ranges from the equivalent of US$350 (China) to $750 (South Africa) and $1100 (Brazil).