A new national survey of 590 spa and salon owners illuminates how the industry is growing, the top challenges owners face, and how spa and salon owners implement technological solutions to common problems.

“The last year was a good one for the salon and spa market in terms of growth and revenue, but small business owners in this industry know that running a salon or spa today is no easy feat,” the survey noted. “Salon and spa owners are forced to compete with big brands and other local shops, and are constantly vying to create long lasting, loyal customer relationships.

At the same time, salon-and-spa owners wear many hats within their business, “from manager and accountant, to customer service and marketing representative, and everything in between.”

Spas and salons are leading employers of massage therapists, and this dive into the challenges facing owners will help prospective employees understand the composition of this portion of the health-and-beauty industry.

Spa & Salon Growth

According to a different report — from the International Spa Association, published in 2017 —the U.S. spa industry has surpassed $16.3 billion in revenue annually, and “the industry continues to experience steady growth with increases in overall revenue, locations, number of spa visits, and revenue per visit.”

In the new survey, regarding sales, 67% of survey respondents said sales increased from 2017 to 2018. Fifty-six percent of that group said sales grew by 10-24%, and 17% said their sales grew by 24-49%.

• 41% of spas and salons earn less than $100,000 in annual revenue

• 30% of spas and salons earn $100,000 to $299,999 in annual revenue

• 15% of spas and salons earn $300,00 to $499,99 in annual revenue

• 9% of spas and salons earn $500,000 to $999,999 in annual revenue; and

• 6% of spas and salons earn $1 million or more in annual revenue

Top 5 Challenges

The top five business challenges identified by this survey in the spa and salon industry are:

1. Marketing to prospective or current customers

2. Making enough money

3. Controlling costs

4. Finding new customers; and

5. Managing time

Spa Tech

The report says that 65% of salon and spa owners plan to invest more in social media, while 32% “are experimenting with new marketing channels.” Further, 34 percent of respondents say they are hiring more employees in 2019. The U.S. spa and salon industry is the top employer of massage therapists.

Understanding how to use technology is necessary to running a small business, and spas and salons are not exempt from this.

Business software is popular among spa and salon owners, as are point-of-sales systems including desktop computers (44%), POS terminals (21%) and smartphones (18%).

The survey results noted: “As salons and spas invest more in technology, their areas of focus speak to the priorities of consumers and the market. The top areas of investment in 2019 for salon and spa owners are marketing software (36%), POS systems (33%) and cloud software (16%). They are also investing in hardware.

“While 62% use desktops to run their business, small salon and spa owners also use more mobile technology like smartphones (55%), tablets (42%) and laptops (30%).”

As to why spas and salons might not implement technological business solutions, the respondents said:

• We don’t have the budget resources

• We don’t have the internal expertise

• We are concerned with cybersecurity risks

• We don’t understand what tools are needed to solve our business problems

• We are focusing efforts on hiring rather than software adoption.

This survey was conducted by ResearchScape International in partnership with DaySmart Software.