The most common measurement of spa retail is retail sales per treatment by therapist.
Markdowns and retail discounts are two factors that affect the cost of sales. Discounts are strategic decisions made by management.
In the classic retail environment, revenue is monitored on a sales per square foot basis that is calculated annually by dividing total retail revenue by the square footage of the spa retail space.
The cost of sales measures the proﬁtability of retail sales. It is a ratio between the cost of the goods sold and the net revenue. It is always expressed as a percentage of net revenue, never as a speciﬁc dollar amount. The speciﬁc dollar amount is expressed as the cost of goods sold. It is the largest expense within a spa retail department and merits study on a monthly basis.
While inventory has been thoroughly covered in a previous chapter, some of the concepts apply directly to evaluating performance and maximizing a spa’s proﬁts.
Spa professionals prepare the retail department annual budget at the same time that they prepare the budget for the entire spa operation. For the budget to be most useful and accurate, spa professionals have to prepare a forecast of retail activities as it represents the road map of the retail operation.
At the Seasons Spa …
Jazmine and the Seasons Spa are avid participants in the Jelly Bean League. They meet monthly to compete against other spa retail staffs.
The spa’s services are a great sampling opportunity to generate a product sale. They are a process that creates a unique form of dialogue around the experience of using spa products such as skin care, body care, apparel, books, and relaxation CDs. The spa’s services are unique opportunities to connect with guests in a traditional sales manner. Therapists are able to build rapport through experience and education.
“Everyone in the company sells the company.” The entire spa team contributes to the sale because guests are being encouraged to take the spa experience into their daily routine. Everyone contributes to the sale whether directly or indirectly. Sales begin the moment the guest calls to book an appointment, the moment that a guest ﬁrst sees an advertisement about the spa or hears about it from a peer.
No matter what the spa product is, when spa professionals sell it, they are helping to extend the service of the spa. Selling is a highly personal art. Highly successful salespeople view it as an art and build a tremendously loyal following—to say nothing of a very successful business.