08 Sep, 2017

Cost Of Opening A Spa

Cost of opening a spa Every month a high percentage (%) of your profits is spent on staff. We would all like to reduce our payroll bill at the end of every month, so how do you know if you are over spending in this area or actually getting great value for money from your team? This is where we can apply some science and calculate your payroll to sales %. This will accurately show you what % of your total sales is spent on staff, so for example your payroll bill is $3,900 and your total net revenue is $10,000 then your payroll to sales % is 39%. However if your payroll bill is $3,900 and your total net revenue is $5,500 then your payroll to sales % is 71%. The lower your payroll to sales % the more profitable your business, if your spa is operating at over 50% payroll to sales then I would suggest a full review to see how this can be improved - this will be achieved cost of opening a spa in one of two ways: 1. Reducing your staff costs 2. Increasing your overall revenue Reducing staff costs Review staff rotes against customer demand - is your staff in at the same time that your customers are requiring their treatments? Review your staffing structure - is this top heavy with too many supervisors? Full time v part time - too many full timers makes your Rota more inflexible, part timers can do more hours if required and give you more flexibility. Receptionists - are they earning their keep? - does your reception team contribute positively to revenue generation via re-bookings, products sales and maximizing your occupancy? Increasing overall revenue The least painful way of improving your payroll to sales is to increase revenue, not always as easy as it sounds however here are a couple of things to consider: If you change your staff rotes to match customer demand you should see increased revenue - e.g. put 9 therapists in on a Saturday and you should see full occupancy, have 9 in on a Monday and you will more than likely struggle for full occupancy. Sarah has a proven record of adding value to organizations through her commercial flair and awareness, her ability to drive new business initiatives, her logical and methodical approach to reviewing costs and developing financial strategy and her attention to detail to ensure the highest levels of customer service. She has extensive experience of the sports club sector and has a unique understanding of the demands on sports club committees. She has proven success improving membership acquisition and retention and in developing new revenue streams resulting in a substantial uplift in profitability cost of opening a spa.