Spa & Wellness Centre

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Spa & Wellness Centre

SPA & Wellness Centre

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The SPA & Wellness centre as a business

Creating a spa and wellness centre in your city or area is a strong business idea. This kind of business meets basic human needs and so can enjoy stable demand with minor seasonal variation, as well as generating a consistent cash stream. Alternatively, you could consider buying up an old spa centre and breathing new life into it with the help of modern spa technologies, design and marketing. We know of many examples where this approach has proven highly successful.

The capital available for creating a spa & wellness centre should be used wisely. The business idea, design and build should be meticulously thought out and consolidated with a highly professional management system. After the business has been 'run in' you can then think about upscaling to create a spa & wellness centre chain.

In this article we look at the issues you can expect to encounter on the path to setting up a spa & wellness business from the design stage right down to personnel management. Whatever shape your project takes at the development stage, a spa & wellness centre, a spa hotel or salon, rest assured, there are ready solutions to all the challenges that building this kind of business poses. A spa & wellness centre is a viable and fascinating area of business to be involved in and the experts at Furnace Art Engineering are always ready and willing to come to your assistance. Having started out by creating top end sauna stoves, we have gradually come to understand the working mechanisms of the spa business itself, and would like to share with you some of our thoughts on the process of building a spa & wellness centre.

If you have already completed the stages described here in this article, then it is probably time to start thinking about the most important component of your spa centre - the sauna stove. Installing stoves manufactured by Furnace Art Engineering, you will successfully propel you spa & wellness centre beyond all competition. Light steam guaranteed!

And so, here is a list of the type of questions that typically beset the businessperson who has decided to build a spa & wellness centre:

How do you chose the construction site? I have a piece of land but will I have any clients? What kind of turnover can I expect from a sauna centre? How exactly will the profits be generated?
What format of spa & wellness centre would best suit my business? For what type of service might there be most demand? How much service area should be allocated to each type of service?
Who has the skills to take on the project development? Who can I trust to build the sauna stove? Should the centre extend across two floors, or is a single-storey premises sufficient? Does the centre need a pool and if so, how many?
What business models exist for a spa centre? Who can I consult for advice?

This little list is just the tip of the iceberg. There's a whole sea of questions that will have to be answered but the good news is, you'll only ever have to answer them once. And yes, the experts at Furnace Art Engineering can make a strong contribution to the setting up of your spa business. The scope of work differs in every case, but we always make a comprehensive list of works required for your spa & wellness centre, whether it is a medium sized enterprise or large scale chain.

So, let's get down to business and start from scratch, breaking it down into the sections and stages that go into building a spa and wellness centre (full version):

Section A - Pre-construction phase: marketing, concept, technical design, brand book, personnel.
Section B - Spa Centre Investment project: services and prices, feasibility study and business plan.
Section C - Development: Construction documentation, space-planning and interior design, interiors working documentation.
Section D - Creating a spa & wellness centre: project support and administration.
Section E - Business production: creating business processes i.e. head-hunting management, business management system, marketing and sales, production, procurement, infrastructure, quality control, human resources, finance and e-commerce.

SECTION A - Pre-construction phase

Stage 1 Researching the current state of the spa & wellness services market

This represents an essential step to any healthy business undertaking. It is the efficient gathering and analysis of market research that underlies any spa centre concept. To begin with, we help clarify your goals and expectations and then move on to the gathering and analysis of objective information relating to the current state of the market.

Express market research related to the site's geographical location
Analysis of the site intended for the spa & wellness business space: defining the functional and technical capacities of the planned facility
Extensive information gathering in relation to the spa & wellness services market in the local region, including open source research. Information analysis focused on a selection of 5-6 market leaders for the purpose of identifying key factors of success
Definition of targeted client categories, target audience
Determining the type and profile of the spa & wellness centre
Determining key competitive advantages of the spa & wellness centre, its main points of attraction, functional and technical requirements, as well as relevant seasonality factors
SWOT-analysis (method based on the analysis of strengths, weaknesses, opportunities & threats for the development of your business system)
Analysis and systematisation of data compiled

Stage 2 Developing a concept for a spa & wellness centre

At this stage, the general idea of building a spa & wellness centre acquires definition. The concept answers the question "what will it actually look like". The main points of the concept are also key to designing the centre’s spa technologies:

Developing a marketing strategy for a spa & wellness centre
Defining the working format of the spa & wellness centre, the organisational principles of services marketing, pricing policy and creating adjustment strategies to tackle seasonal fluctuations
Offering separate attraction points, i.e. features that can be integrated into a spa & wellness centre to attract more clients
Describing key service categories, infrastructure and additional services
Describing the principle operational and design solutions of the centre, providing rationale for dividing the site into functional zones (aqua-thermal or wellness zone, spa procedure zone, beauty zone, fitness zone, recreation and relaxation zone, cafe etc)
Developing architectural and town-planning solutions
Drawing up example list of recommended equipment
Determining approximate cost price based on per square metre cost of each functional zone

Stage 3 Technological design solutions

This stage represents a kind of roadmap or conceptual scheme for your spa & wellness centre. The task involves creating a technology map for the centre's operational capacity, pulling together functions and services, aligning functions according to zone and then thinking through the equipment required for each individual zone. Using the data produced by the previous two stages, we calculate client flow and grade the pressure levelled on each technological function. This stage is essential to achieving maximum efficiency i.e. to maximising revenue generated per square metre.

Zoning rationale and recommendations for equipment layout
Technological distribution of equipment across zones
Technical specifications
Calculating and organising client flow in a spa & wellness centre
Recommendation report on selecting the right control system for your business
Defining the parameters of the information system: which information systems should be installed, distribution requirements and integration principles
Defining parameters of technical systems for client feedback: service payment systems, card systems, membership, discount schedule, recording traffic per service, recording consumables, tracking movement of products in storage, financial reports and analysis, requirements for installation within the unified information system
Defining parameters of system access control, event-driven video monitoring: requirements for installation and integration within the unified information system
Strategy analysis
Functional division of areas
List of selected spa & wellness centre equipment (specifications) with data on energy and water consumption
Distribution of electricity and plumbing equipment and requirements for ventilation and lighting
Minimising non-functional zones
Designing internal business and service premises

The steam room represents a special component of the technological design. The following factors must be taken into account: temperature and humidity regime, air exchange requirements, sauna stove requirements (traditional classic Russian sauna stoves, ensuring light steam and healing heat, integral ventilation system, monitoring core temperature parameters, inbuilt alarm when temperatures exceed acceptable norms etc), requirements for commercial operation of steam rooms and stoves, requirements for steam room fittings and external finish of sauna stoves and solutions per stove fuel choice (firewood, gas or electricity). The requirements listed in this section serve as the foundation for the technical task of developing stoves in steam rooms for a traditional Russian sauna.

Stage 4 Brand design (brand book)

It might seem as if this task is a little premature, as the plans for the centre are not yet complete and so far, we have only looked at the spa technology. However, the features of the brand book will be required very soon once the architectural plans for the centre are being developed.
Choice of name, brand colour scheme, logo, business card layout, forms, information booklets and folders
Creating visual identification carriers, personnel dress style, market positioning methods etc.

Stage 5 Staff regulations

A spa & wellness centre belongs to the services sector and therefore, up to 40% of fixed costs relate to wages, including taxes and other deductions. To calculate the feasibility study, we need to assess the centre's estimated staffing rota at the load capacity of approximately 80% client flow. At this stage, we already have all the essential information to hand: scale of the centre, format and client flow. If we compare these data to the conditions of the local labour market we can deduce:

The work rota for support staff
Description of employee’ responsibilities per position
Qualification requirements
Proposals for a motivation system that reflect the local labour market in the service sector
Payroll forecast

SPA & Wellness Centre

Pre- construction phase

Geography

United Kingdom

Switzerland

Spain

France

Italy

SPA & Wellness Centre

INVESTMENT PROJECT

SECTION B - INVESTMENT PROJECT

Stage 6 Services and prices

We are getting ever closer to calculating a business plan. At this stage we formalise the services specification for the spa & wellness centre. For every services group, we will determine the approximate standard ratio between labour and materials that must to be produced in order to provide the service. A set of services in actual proportions of guest consumption helps generate an average bill, with a cost and sale price:

Creating an end-to-end services form (proposed services with recommended price)
Calculating an average bill in terms of production cost and price.

Stage 7 Feasibility study

In order to build an economic model of a spa & wellness centre, we have to assess the initial investment cost of building the centre property and fixed and variable running costs, as well as put forward reasonable assumptions regarding the timing of the launch of the centre at full load capacity in terms of service:

Cost estimates for design, construction, equipment and installation
Chronological plan for implementation of work on the investment project
Sales plan and timetable for increasing load of all working areas in percentage and monetary values
Estimated marketing costs
General production and administrative costs
Estimated staffing costs
Estimated tax cost

Stage 8 Creating an economic model for the investment project

The time has now come to bring together all the previous developments into a single economic model, in other words, a business plan. This document can be used to fulfil various tasks e.g. to convince a bank to issue a business startup loan, estimate outgoings and timescales for return on investment and profit. Given that this type of project isn't a shot in the dark or something that no-one has ever tried before, we can expect the calculations to be fairly reliable. The business model can also be used in the task of helping you chose the right business configuration, perceiving the main footholds in the path to making profit, and making timely alterations to the technological concept and design task. Whilst no investment outlay has been made, there is still the opportunity to reassess the project's main features. The goal is as always, to get the quickest return on investment. An assessment of various development scenarios can be made on the basis of the following parameters:

Profit and loss over the entire period of return
Cash flow
Balance (assets, liabilities and sources of funding)
The project's financial indicators (factors of liquidity, working capital metrics, profitability)
Indicators of investment effectiveness (net present value, IRR, payback period)
Sensitivity analysis
Risk analysis

If the economic model is built with integrity and contains manageable features that affect the financial results, one can not only greatly improve financial performance, but also understand which aspects of the project's development should be prioritised, and which key aspects should be controlled.

Once the investors have approved the business plan, project developers can be brought on board.

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Customers

Countries

Awards

Inventions

Section C - Development

Stage 9 Construction Documentation

We recommend managing the development project in accordance with international standards for building information modeling (BIM- technology, Building Information Modeling) that allows you to minimize errors in project documentation and accelerate the development process.

The project's construction documentation is developed in accordance with legislative requirements and consists of the following sections:

Site plan
Architectural solutions
Construction solutions
Power supply system
Water supply system
Drainage system
Heating, ventilation and air conditioning, heat networks
Network connection
Gas supply system
Technological solutions
Construction Management
Environmental protection measures
Fire hazard mitigation
Measures to ensure access for persons with disabilities
Construction budget

A building information model is attached to the documents. Basic drawings executed in accordance with the requirements of the Building Systems Design Documentation are attached to certain sections of the project documentation.

Working documentation for the construction of industrial and residential sites is developed at the second stage of design in accordance with the requirements of national standards and departmental standards for technological design and is produced according to BSDD standards. The working documentation includes:

Working drawings, intended for the implementation of construction and installation works
Working drawings for building products and construction
Sketches of general form of non-typical products
Budget documentation
Bill of scale of construction and installation works, as well as consolidated statements of materials requirements and specifications for equipment, products and materials approved by the client.

Stage 10: Conceptual design of interiors (design project)

The best way to reduce time spent on developing the design project is to chose analogues based on international practice in the design of spa spaces. Design is a very subjective matter and so agreeing the design in parts can turn out to be extremely time-consuming and consecutive edits can even weaken the end result. We strongly recommend learning from existing projects. Another important point is that it is much more important in a spa & wellness centre to concentrate efforts on the reliability of the sauna stove and the logical spatial layout of the steam room.

When a design analogy has been chosen:

Drafting the interior design task (technical specification)
Functional plan of the premises based on the functional technological scheme
Plan of interior walls
Photo-realistic visualisation of interiors
Preliminary selection of finishing materials

Stage 11: Working project for interiors design (working documentation for interiors design proposal)

In essence, working documentation for interiors design is a compilation of plans and working drawings of interior elements: zoning, erected partitions, arrangement of furniture and equipment, placement of lighting fixtures, decorative materials and floor coverings, sweeps/cuts in the premises and much more. All plans are consolidated into a building information model.

SPA & Wellness Centre

Development

Getting to know

the customer and brief

Digital

modelling, design and costing

Preparations

pre-assembly and production schedule

Manufacturing

creating and lining the stove, finishing the steam room interior

Customisation

delivery and instruction

Support

and care throughout the stove life cycle

SPA & Wellness Centre

Management

Section D - Project Management

Stage 12 Project management system

At the stage of construction and installation, when the main list of works required to build a spa & wellness centre is carried out, additional control is required on the part of the client, and not only with regard to the allocation of resources. It is important to assess whether the intended plans are being realised successfully, and to make timely adjustments when required. Here we can offer supervision of work and compliance with the decisions made in the draft.

Test drive

Section E - SETTING UP THE BUSINESS

Stage 13 Creating business processes

Building a spa & wellness centre and profitably exploiting the business are totally different tasks that require different skill sets and competencies. Therefore, in parallel with construction work, the centre's staff is selected and tasked with preparing the centre for opening. A good start presupposes the existence of a work plan which guides logical, sequential actions and makes sure that time is used efficiently. The period of return is at stake. In our opinion, this is what should happen next:

Selecting senior managers

Qualification requirements for the centre's senior managers (Director, heads of departments and services in a coherent organisational structure)
Help with hiring manager and department heads
Recommendations for team-building

Business management system

The business model for the business' key components
Structure of the centre's business processes, purpose and main correlation
Parameters for measuring business process efficiency, allocation of responsibility according to organisational structure, quality control
Management cycles Elements of owner control over management system

Marketing and sales management system

Product matrix. Specifications for business services. Price-list
Based on the brand-book: requirements for "packaging" the centre's main and additional range of services (internal advertising design templates)
Recommended methods for achieving the centre's planned load capacity at the sales deployment stage. Marketing Plan
Recommended methods of maintaining planned capacity rate (seasonal compensation, key clients etc.), marketing plan
Description of sales method, recommended methods to increase average bill, pre-sales and cross-selling, sales department management plan Sales plan

E-commerce

Technical specifications of the e-commerce system
Optimised site with options for booking, online shopping and adapted content
Promotion channels and media plan

Production management system

Technological map of the centre's main and additional services. Unit labor costs, material consumption norms, sequence of operations
Methods of the centre's periodic production planning: sales plan, load capacity, staffing requirement, material requirements, stock recording

Procurement management system

Procurement management principles by materials group: cosmetics, soft inventory, food, office supplies and so on
Methodology of monthly and weekly procurement plans
Methods of inventory for stocks and monitoring compliance with processes of technological material consumption

Management system of engineering and administrative infrastructure

Schedule of routine maintenance and scheduled preventive maintenance of the centre's technological equipment
Setting norms for component and consumable materials for the centre's technological equipment
Cleaning, disinfection and disinfestation rota, recommendations for outsourcing infrastructure management functions

Human resources management system

Organisational structure, dynamic staffing rota depending on sales plan and job descriptions
Qualification requirements per position, regulations for staff recruitment
Employee remuneration system, effect of key performance indicators on wages and wage regulations
Staff training system, recommended training (types and frequency relative to position) to maintain required levels of customer service

Financial management system

Methods of profit management (annual business planning and financial statements)
Current budgeting standard (budgeting of revenues & expenses, cash flow)
Fiscal calendar management

IT infrastructure development

Based on the agreed development plan, managers develop corporate governance guidelines which determine how the business functions. It is important to emphasise that managers must create their own system by coming up with answers to various questions, jointly discussing how they will work together and what philosophies they choose to underpin decision making processes. As a result of this stage, business management will work in accordance with a unified, consistent system aimed at producing profits within set timescales. Decisions, policy and procedures will be formalised in internal regulatory documentation. A high-quality management system is essential to ensuring swift return on investment and generating stable profit from the centre investment project. It can also be employed if the decision is made to upscale the business to a chain format.

We hope the information in this article has been useful. Wishing you every success in your endeavour!

SPA & Wellness Centre