The salon and spa industry is a growing and dynamic player in the United States economy. In the United States alone there are over 900,000 salons and spas with annual sales near $40 billion. The increase in sales has reached 116 percent in the last few years. Though no business was entirely recession-proof, salons and spas saw their sales stay the same overall and the industry only lost .1% of their businesses. During the same time the private business sector lost tens of thousands of businesses per quarter.

The salon and spa industry is unique in a few ways which most likely helped them stay afloat. First of all most salons are a cash business. This means that they get paid immediately when the service is rendered. Service providers are then paid after the service is rendered and the salon has been paid. Salons and Spas have a very low inventory cost because their retail product sales are a much smaller part of their revenue when compared to their service sales. Another important piece to the puzzle is that being a service industry – the work cannot be outsourced to another country, and the service being provided is somewhat necessary.

There are a few down falls of the industry that are important to be aware of. Most of the income is brought into the business by services providers. Those service provides receive a large percentage of the money from the service. Profitability can be a challenge. You are also vulnerable to having productive service providers leave your company and take their clients to another business. Salons and spas also have a high cost of goods and many supplies that need to be managed properly. Supplies are easily wasted if there is not diligent monitoring of the usage.

The trained consultants and accounting specialists at Numerico PC can help you rain in your expenses, motivate your team and plan your profitability to make sure you stay in the game for years to come!

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