FRANCHISING W
oodhouse was formed 10 years ago and has 26 locations in 13
different states in the US. We set out to take spa from luxury to necessity. Later this year we will open our fi rst site
JENI GARRETT Founder and CEO, Woodhouse Day Spas, US
Franchisees are required to have liquid
overseas, in Punjab, India. T is 15,000sq ſt (1,393sq m) spa has been adapted to suit the local market: it will off er memberships, a salon, a gym (for male appeal), yoga, pilates, a café and a bridal suite, as this is a big mar- ket in India. T e day spa franchise concept is new to India and we chose to start our inter- national development there as our franchisee is very familiar with the area. Aſt er eight years of setting up our systems, we are now ready to really focus on the development side – domestically and internationally. We off er 35 treatments – mostly ayurvedic
and very results-orientated – and we worked with holistic and certifi ed organic lines like Amala, Naturopathica and Arcona. What sets us apart is what we call the Woodhouse Experience: little details, such as our signa- ture oil and handwritten thank you notes.
capital of us$200,000 (€142,250, £124,350) and a network of us$250,000 (€177,800, £155,450) in order to qualify. T ey have to demonstrate the willingness to work hard, market the brand and develop a team. T ey all come from outside the industry: some have been in corporate America and have been laid off , retired, or just want to be their own boss. Others are business owners and entrepreneurs who want to add this to their group of businesses. T e initial investment is anything from
us$400,000 to us$600,000 (€284,550 to €426,850, £248,700 to £373,050). T e royalty fees are 6 per cent of gross sales and there’s an advertising fund of 0.25 per cent. We off er ongoing training, with weekly
webinars and a huge resource library. We also do detailed fi nancial reporting, and help
All of our franchisees are from outside the industry: some have been in corporate America and laid off, retired, or just want to be their own boss. Others are entrepreneurs
D
ragonfl y launched in 2003 (see sb09/4 p20) and we current ly
franchisees with their budg- eting on an annual basis. There’s an online support village where they can blog with each other. T ere are eight marketing promotions a year with tools to deliver
this. Franchisees do their own recruiting, but we provide the tools and resources for this. Protecting the brand is our job, so we have
a very fi xed policy and procedure manual and all staff are well trained and drilled to stick to protocols. We ask franchisees to do compliance surveys and all guests are given a comment card. All of our treatments are cost- ed-out down to the cotton balls, so if we see a deviation in product costs we can trace it. A decentralised system and dealing with
many personalities is the biggest challenge of franchising. We have to make sure that we protect the brand by clearly communicating our vision and making sure this is properly understood. We have been very selective with our franchisees, which is why we haven’t grown as fast as we could have. We’re in con- stant contact with our franchisees: studies show that the happiest franchisees are those who feel they are heard.
Garrett launched Woodhouse Day Spas in 2001 as a young student at the University of Houston and University of Victoria, and a year later took the concept nationwide. Details:
www.woodhousespas.com
have 21 ‘spa shops’ in seven cities in mainland China and Hong Kong. With the fast economic growth of China’s second tier cities, we believe we will have 50 to 80 shops in China within fi ve years. A typical retreat is 250 to 350sq m (2,690
RANDAL EASTMAN Vice president, Dragonfl y Therapeutic Retreats, China
tion and provide a test bed for us to learn some of the nuances of franchising fi rst hand. A passion for the brand is one of our main
to 3,767sq ſt ). We don’t off er water treat- ments, our core services are Chinese (tui na), shiatsu, head and shoulder, Oriental foot and aroma oil massages. A standard massage, without oil, is us$25 (€18, £16). We also combine treatments into one or two- hour packages and sell memberships, which entitle customers to discounts. T e decision to start franchising was down
to interest from customers wanting to get involved. Our fi rst franchisee didn’t have any spa or retail experience, but lived in one of the expat enclaves within Shanghai. We decided this would allow us to expand into a new loca-
SPA BUSINESS 3 2011 ©Cybertrek 2011
franchise requirements, as well as enough working capital. T ey also need to have a commitment to top notch customer service, respect for the system, attention to detail and show initiative to develop their business. An initial franchise fee is charged, along
with a design fee. Ongoing costs include a monthly royalty fee, monthly advertising minimum spend and training for new hires. If the franchisee wishes to secure a territory, they must negotiate a territory development fee, which is tied to an appropriate number of shop openings, with annual milestones they must meet. We learned to set territory milestones by painful experience, as we
found ourselves shut out of lucrative markets while fran- chisees sat on their hands. We provide our fran-
chisees with a turnkey solution and ongoing serv- ices include maintenance of
the IT system, as well as support for mar- keting, graphic design, CAD for renovations, recruitment, staff training, benchmarking, management coaching and quality control. In 2007, the Dragonfl y Academy was established to deliver in-house training. However, fran- chisees are still responsible for recruiting. Maintaining the consistency of the spa
experience is one of the biggest challenges, as sometimes franchisees want more independ- ence. We use a number of tools to maintain standards: daily sales reports, weekly staff meetings with managers, weekly visits to all shops, mystery shopping reports and cus- tomer feedback forms.
Eastman has been a partner in Dragonfl y for six years. Details: www.dragonfl
y.net.cn
Read Spa Business online
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