Intelligent Spas’ second Spa Benchmark Report on the South African spa market presents an extensive collection of financial statistics including breakdowns of key performance indicators by day spas, hotel spas and resort spas. The new research found over 200 spas are operating in South Africa and generated revenue of ZAR380 million (approximately USD47 million) in 2008, representing a 2% decrease compared to 2007.Other key findings include:
- 45% of spas were day spas (not co-located with accommodation) and 55% were destination spas incorporating hotel, resort and retreat spas offering overnight accommodation.
- Over 2,500 people were employed by the South Africa spa industry in 2008, which was a 15% increase on 2007 employment numbers.
- Treatment revenue per spa decreased by 16% between 2007 and 2008.
- Hotel spas achieved higher revenue per spa compared to day spas and resort spas.
- Day spas achieved more daily visits per spa on average compared to hotel and resort spas.
- Less than 30% of spa visits were from males.
- International tourists made up over one fifth of visitors.
- Over two thirds of visits to hotel spas were from people not staying in the adjoining hotel, highlighting the importance of hotel and resort spas also catering to their local markets in terms of operational policies and procedures and incorporating local day spas in their competitor analysis activities.
- Prices of standard spa treatments were higher at hotel spas in comparison to prices set by day spas and resort spas.
- 77% of respondents stated clients are more price sensitive explaining clients had requested discounts, packaged treatments and added value.
Dr. Nadine de Freitas, Executive Director, South African Spa Association added “the release of the South African Spa Benchmark Report is a fundamental step in the growth and maturity of the South African spa industry, allowing an accurate understanding of the industry statistics, financial indicators, industry weaknesses and strengths, to facilitate efficient spa operations and maximise profit potential and industry opportunities. The South African Spa Association thanks Julie Garrow and Intelligent Spas for their commitment to 100% independent spa research, so allowing all investors and spa operators access to crucial spa intelligence, to indentify key success factors and ensure a successful and competitive spa, in today’s ever-changing market.”
Industry Outlook:
- Spa numbers are forecast to grow by 8% this year.
- Visits to day spas are forecast to grow by 20% in 2009.
- Revenue per spa is predicted to increase into 2010.
Research Objectives and Sampling
This Spa Benchmark Report aims to provide a reliable update of the spa population, profile, size and value, plus calculate updated and reliable industry benchmarks for key financial and performance indicators.
The research achieved a response of 62 validated spa businesses, representing 30% of the spa population, where 5% is considered reliable in industry research terms. Intelligent Spas' Global Spa Benchmark Program is currently underway in over 80 countries and aims to produce reliable and comparable statistics to help spas maximise their performance, provide business intelligence to assist other organisations to better understand, service and support the spa industry plus generate greater awareness of the spa industry to increase spa visits. Theodore Koumelis - Thursday, October 15, 2009