Industry • Perspective
Apr.18,2022By Boulevard Staff
Day spas are a great place to go when you need a day away from stress and are looking to indulge, but when you’re looking for more long-term care and wellness, then a medspa is where it’s at.
After spending way too much time away from spa care during the pandemic, people are jumping at the chance to get those treatments and procedures that they somehow endured the last year or two without. This, in turn, is driving the average medical spa revenue through the roof.
It’s great that the medspa business as a whole is booming, but what about yours, specifically? Where do you stand amongst the competition? Find out what the average medspa is pulling in to see how your biz compares.
The American Med Spa Association is back again with its 2019 Medical Spa State of the Industry Report, packed with statistics that may blow your mind. Let’s start with the big one.
The medical spa industry is one of the fastest-growing industries in the whole country (looks like you’re in the right biz), and it is nearing a total value of almost $10 billion. But what about individual med spas? According to the Medical Spa State of the Industry Report, in 2018 the average medical spa revenue was $1,526,382.
Let’s break down that number even further so you can get a more detailed look at where your medspa stands with the rest.
Another important number to consider is how much money each client who comes into your medspa spends. Some are in there for a quick little boost and inexpensive treatment, while others may be coming in for a laundry list of procedures.
By averaging out those lower-spend clients with the high rollers, the International Spa Association was able to determine the average revenue per visit, $97.50. This number is down a bit from pre-pandemic times, which saw an average revenue per visit of $99.50.
Dive into your numbers to find where your average spa revenue per visit sits and whether you need to put in some effort to boost that up.
You know better than anyone that owning a medical spa is no easy feat. There are countless moving parts, from having a solid business plan to having the best spa management system to creating a team of employees that do a great job and love doing it.
So here comes the million-dollar question: Are you making enough money to make the hard work worth it?
That’s a question only you can answer, but to give you an idea of where other medspa owners stand, it’s key to know that, according to the American Medical Spa Association, the average med spa has a profit margin of 20-25%. This means the average medical spa owner salary is between $300,000 - $375,000.
If your numbers don’t look anything like that, then it’s time to take a deeper dive into your profit margin to find where things may be going wrong.
Just to make sure we’re on the same page, here’s a quick refresh on what we mean by “profit margin” – the profit margin of your medspa is the amount that remains after you’ve paid all of your expenses.
To calculate your medspa profit margin, subtract your total expenses from your total revenue, and then divide that by your total revenue.
Profit Margin = Total revenue - Total expenses
To calculate this, you need to know six key numbers:
The profit margin is expressed as a percentage. And to give you an idea of where your number should be . . . the average medspa profit margin is around 29%. Fingers crossed that your numbers are somewhere around this, or better yet – maybe even higher.
If you find that your med spa’s profit margin doesn’t measure up to the average, then it’s time to give your business a facelift. You can implement some changes to your business that will help shoot your profit margins above and beyond that 29% mark, and it all begins with cutting your operating costs.
Running a medspa entails a lot more operating expenses than people think (and maybe more than you thought when you got into the business).
Some of those key operating costs include:
Rent or purchase price for the location
Equipment and tools
One way to bring down those costs is to invest in technological efficiency. The right business management platform can help to elevate your client experience by creating more personalized touches. Think things like the ability for clients to self-book appointments online and to share notes and inspo photos so that you can get a better idea of the results they’re looking for.
In addition to that, the right software provides your employees with quick and easy access to client information including allergies, treatment history, and more to ensure everything runs smoothly and to make your clients feel like they’re your favorite child. Follow-up becomes easy too, as a good platform will allow you to see suggested products and purchase history to help drive upsells.
Speaking of upsells, you want software that will allow you to offer contactless payments as well as custom reporting to see how different services, treatments, and products are performing in your medspa.
When it comes to your employees, the best business management platform should have quick and easy onboarding as well as a way to keep track of employee performance.
By having technology that is efficient and offers tools like those above, you save yourself a lot of time. Can you imagine trying to manually book every appointment? Scrambling to find client information because it’s not all in one place? Missing out on add-ons because you can’t access what treatments and products your clients may be interested in? Sounds like a nightmare.
Boulevard was built to help your medspa reach a revenue that goes above and beyond the average medical spa revenue. Get a free demo today to see for yourself how this platform can take your business to infinity and beyond.
Boulevard was built to help your business achieve profitability at scale without losing an inch of sanity. See for yourself! Get a free demo today.