You’ve always dreamed of using the latest treatments to help people look and feel their best. Now it’s time to dig in and learn how to start a medical spa. Getting any kind of business off the ground is an accomplishment worth taking pride in. That goes double for one that lies at the intersection of modern medicine and the ever-changing beauty industry, and all the unique considerations that entails. We won’t tell you it’s going to be easy, but we will tell you that it will be worth it, and we can help. Here’s how to get started.
Industry • Best Practice
How to Start a Medical Spa: The Complete Guide
Take your medspa dreams from concept to reality and make a profit doing it by following these key lessons
3 key things to know about how to start a medical spa
Would-be medical spa owners don’t even need to know the difference between Kybella and CoolSculpting as they begin, they just need to keep in mind the old adage that an ounce of prevention is worth a pound of cure. Planning out your business ahead of time and knowing what to expect from it financially will give your new medspa the best chances of success.
You’ll want to make sure you have a solid plan from the start, since if you’re still wondering “how much does it cost to start a medical spa,” one current owner notes that it could range from $700,000 to $1 million.
Set up a medical spa business plan
The first step in starting a medical spa is laying out the ideal business plan. This central document should include what makes your business unique, how you plan to bring customers in, what kind of facilities you will require, and what you’ll need to do to comply with the unique licensing and legal requirements for medspas. Your business plan should also integrate revenue projections and weigh them against national averages, but more on those parts later.
The first step is explaining your business opportunity. This is what sets your business apart. Think about what market problem you’re going to solve and how. Who is your medspa’s target market, and who will be your competition for that market? Finally, what advantages will you have over your competition to make sure your target market picks you instead? If you ever feel like you’re being too optimistic in the answers to those questions, you probably are. Revisit that part with a more pragmatic eye — or invite a more pessimistic partner in to collaborate.
Now it’s time to decide how you’ll bring in customers. Make sure your marketing plans go beyond simple, universal concepts like using social media and digital marketing. If you need a little more help, our guide on building a spa marketing plan may be helpful. Reaching potential customers is just the first hurdle, and it’s equally essential to consider what sales approaches you’ll use to convert those interested people into paying clients.
The next step in figuring out how to start a medical day spa is dialing in the physical characteristics of your business. Start by planning out what the ideal venue will look like in terms of location, square footage, aesthetics, and practical concerns such as parking. Then plan what kind of tech you’ll need to make it all work, from spa management software to the specific pieces of equipment you’ll need for treatments.
Most of this advice could pertain to just about any kind of business, but the medical nature of medspas means they face extra scrutiny. A business lawyer will be an essential partner in accounting for specific concerns. At the very least, you can expect to address physician licensing requirements, HIPAA compliance, and legally mandated payroll structuring.
You can find more tips in Medical Spa Business Plan: A Checklist for Aspiring Business Bosses.
Calculate your medical spa profit margin
Before your business gets off the ground, you’ll want to know how to track its success. Calculating a profit margin is the closest any business can come to a single figure for tracking financial health. The fact that it’s a relative figure, rather than an absolute measurement of money, also means it’s a useful metric when you’re trying to account for versus other businesses.
The American Med Spa Association’s 2019 State of the Industry report reveals that the average profit margin for a medical spa is 29%. So how do you know how your business may measure up? As long as you’re keeping track of your medical spa’s accounting details, it’s easy to find out.
Calculate your company's net income, which equals revenue minus expenses.
Divide the net income you calculated by your net sales, also referred to as net revenue.
Multiply that number by 100 to convert it to a percentage.
Find even more ways to measure your business’ financial health in Calculate Your Medical Spa Profit Margin With These 3 Easy Steps.
Find the average medical spa revenue
Now that you have a good way to measure your business against others in a relative financial sense, you’ll also want to know what to expect in more concrete terms. After all, even if you’re looking into how to start a medical spa first and foremost to offer helpful treatments to your local community, you’ll still want to make some money for your trouble.
Fortunately, the American Med Spa Association’s report once again has nationwide averages to help fill in the blanks. According to the AMSA, the average revenue for a medspa was $1,526,382 in 2018. Keep in mind that this number is an average for businesses of all sizes, from the smallest independent spas owned and run by a tiny crew to massive operations associated with other medical organizations. That’s why it’s a good idea to keep your particular business plan and profit margin in mind as you consider these kinds of industry-spanning metrics.
Find more key details to help contextualize your medspa business operations in What Is The Average Medical Spa Revenue? See How You Measure Up.
With your plans laid out and your measures of financial success ready to go, Boulevard can help you set up appointments, handle pre-consult client notes and forms, manage marketing and loyalty programs, and more. With Boulevard on your side, you can focus your time on turning your dream business into a reality.
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.