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Dateline March 2008: Bear Sterns collapses, oil hits $120 a barrel, housing stats and housing values are at a 16 – 17 year low, the Dow Jones swings wildly often 200 – 300 points per day, and the credit industry threatens to take our economy deeper into debt.
What is a Spa Owner to do?
First we must keep our eye on the ball; despite how unsettling the economic news is these days, each of us must realize that we personally can not do anything about these events. In fact our individual successes is the best thing we can do for our country and our economy. So the lesson is to focus on what we do best and make it as successful as possible. The ripple effect of this is that we provide employment , and contribute to a healthy economy in each of our communities.
Despite what politicians tell us, our [collective] economic struggle will not be solved with greater consumer participation, but rather through greater productivity.
Second, we must seek opportunity that did not exist before. A bear market provides each of us with new opportunities and we must be sharp enough to recognize them and take advantage of them when they present themselves.
This is just as true for those of us who have been in business for a while as well as those about to get into the Spa business. I am more optimistic than ever that success can be achieved in, frankly, greater proportions during an economic downturn than during the healthy economic times. For you see that when business is easy, then all businesses seem to look the same to the consumer, but when there is tension and struggle the wheat is separated from the chaff. The professional organizations tend to stand out more from their competition and hold the loyalty of the Client.
Consumers can smell panic in a business and when the aroma of failure is in the air they will seek out your competitors and spread the word to their friends, further crippling your business. But therein lies the opportunity, because your competitors are feeling the economic crunch, some will go out of business, some are just scared, either way YOU stand to gain part of their market-share if you are the BEST and you remain optimistic.
Over the next three weeks I will share with you my strategy for weathering the storm, increasing business, finding opportunity, and enhancing your return on investment.
I will be writing 3 more posts, as well as answering your questions and learning from your feedback.The first will be, “Finding the Opportunity For Existing Spa Operations” , the second will b, “Opening A Spa During A Shaky Economy”, and the third will be, “New Opportunities For Investing In Spas Right Now”.
In the mean time, I would ask each of you to do 4 things in preparation for these posts –
1. Turn off the news; focus on yourself and what you can achieve. (Re)watch or (re)read “The Secret” or other materials that will help you “visualize” what you wish to accomplish.
2. Join the Day Spa Association and let’s band together to strengthen each other through education, networking, lobbying, and to use the benefits that members enjoy to better equip and manage your business.
3. Take a look at your operation (or visualize the operation you want to have) and ask yourself the tough questions:
a.) Are you poised for success?
b.) Are your expenses under control (payroll expenses in particular)?
c.) What are your market differentiators, what makes you different (or better) than your competition?
d.) Are you doing everything you can each day to drive more business through the door and control your expenses?
e.) Or are you already overworked and underpaid and don’t know which way to turn?
f.) What are your competitive advantages and disadvantages?
4. Take a field trip through your community and find the Spas / Salons that have already gone out of business , identify those that are about to go out of business, and then determine why they are failing. Then ask yourself what makes you different from the ones that are still left in business and why clients go to them instead of your facility.
This self-assessment , re-focusing, and competitive analysis will come in handy during our future posts whether you are already in business, want to open a spa, or are looking for opportunities for investment.
Best wishes & Healthy profits,
Filed under: DSA Biz Paradigm Shifts |