RESEARCH
FIGURES FROM A NEW 2010 REPORT SHOW THAT SPAS WERE HIT HARD IN THE DOWNTURN, BUT ARE STILL IN DEMAND. WE ANALYSE THE FINDINGS AND GET THE INDUSTRY’S RESPONSE
DEEP IMPACT P
LEONOR STANTON » CONSULTING EDITOR » SPA BUSINESS
KF Hospitality Research’s 2010 benchmark review – Trends in the Hotel Spa Industry – is the fourth annual review of an industry, which up until 2008
had experienced enormous growth over the previous two decades, and was crying out for robust market and fi nancial intel- ligence. T e survey, which reports on 2009 fi gures and is based on a sample of spas in 81 hotels in the US, shows what a horren- dous year 2009 was for spas. Despite the poor numbers, however, there
is an increasing expectation that spas should be off ered by luxury brands. Jeremy McCa- rthy, global spa development and operations director at Starwood says: “While 25 per cent of our hotels used to off er spa facilities, it is now probably 33 per cent and 50 per cent in our development pipeline. Furthermore, the one lesson we have learned from the fi nan- cial crisis is that people want spas. While our
group business might have dried up, hotel guests and locals still demanded a spa expe- rience, even though some of them might have scaled back their expenditure.”
THE SPA NUMBERS
Spas are considered an operating department of hotels in this study and overall, nearly 77 per cent of hotel spas in the sample suff ered a decline at a departmental profi t level between 2008 and 2009, with 7 per cent suff ering a loss in 2009 – that’s a loss before any undistrib- uted expenses and fi xed charges. According to the survey, the average annual
Revenue per treatment room was just over us$130,000 in 2009, down 19 per cent from 2008
revenue per treatment room in hotel spas in 2009 was just over us$130,000 (€92,550, £81,350); this represented a 19 per cent drop on the previous year’s revenue fi gures. T e largest expense was labour, which in 2009 on average accounted for just over us$73,000 (€52,000, £45,700) – reduced by 19.5 per cent from 2008. Aſt er all other operating expenses, the average departmental profi t per treat- ment room was around us$34,500 (€25,250, £22,200), also 19 per cent down from 2008. T is average departmental profi t represents 26.5 per cent of spa departmental revenue. T ere is, however, a huge variation when
the fi gures are analysed by type of hotel or by size of spa. Revenues vary from us$74,000 (€52,700, £46,300) per treatment room in spas with incomes of less than us$1m to nearly us$194,000 (€138,150, £121,450) in larger spas
TABLE 1: CONTRIBUTING HOTELS - 2010 SURVEY*
No of hotel spas (survey sample) Sq feet/spa facility
Treatment rooms/property Stations/property
Total spa revenue US$ per sq ſt
Department income** US$ per sq ſt of spa facility % of spa departmental revenue
Urban 18
7,979 10
4.0 162.86
35.20 21.6%
TYPE OF HOTEL Resort 63
13,606 14
5.0 131.66
36.13 27.4%
* Based on 2009 fi gures ** Before deducting undistributed and fi xed charges 32 Read Spa Business online
spabusiness.com / digital SPA BUSINESS 2 2011 ©Cybertrek 2011
$3m+ 11
26,727 21
8.0 153.64
54.42 35.4%
SPA REVENUES $1m–3m 39
12,849 14
5.0 143.92
34.52 24.0%
Less than $1m 31
6,635 8
3.0 92.17
13.29 14.4%
PHOTO:
SHUTTERSTOCK.COM/MAXFX
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