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Oct, 12 2010

Spa-fully Splendid

EARLIER five-star hotels used to offer high-end spa services but these days the spas have come out on the high streets and malls. With the market maturing and middle class showing keen interest in spa services, their services are now catering to the masse

EARLIER five-star hotels used to offer high-end spa services but these days the spas have come out on the high streets and malls. With the market maturing and middle class showing keen interest in spa services, their services are now catering to the masses, and not only classes. From the southern part of India, spas have now proliferated to the rest of India. The spa experience has set the base for the market with a growth rate of 20 to 30 per cent in the past few years. The spa industry presently stands at Rs 11,000 crore. As per a report by Ernst & Young for FICCI, the country has 2,300 spas, out of which 70 per cent are run by local brands. As many as 700 new spas are expected to enter the market in the coming years.

Business potential

Siddharth Shankar, Managing Director, Mystic Salon & Spa Ltd, says, “India is poised to attract significantly more Western tourists while continue to develop its own vibrant spa market at a heady pace.” Sharing the same, Anurag Kedia. Director, The Four Fountains Spa, says, “A significant majority of the industry is unorganised and there are several day spas operating presently. However, this is changing fast. The industry is experiencing double-digit growth. This has generated interest in several corporate groups who are now trying to capture different segments of the spa market. The sector is expected to double its size every two to three years and see several innovative offerings.”

Mystic Spa has three spas with the average footfall of above 500. Four Fountains has eight spas with four more in the pipeline, which are expected to get operational by end of October. Sohum Spa currently has five spas operational.

Flip side

The spa industry is short of skilled manpower and therapists. “The biggest challenge is the manpower. We always run short of skilled manpower, especially for massages and facials,” says Shankar. Agrees Kedia, “Because the industry is relatively new, the acceptance of being a massage therapist as a career option is not very high. This is expected to change with time, as the industry evolves and grows further.”

Franchisability

Franchising does offer an opportunity to grow fast for any business. However, it is important that the franchisee has a professional background and an inclination towards hospitality. As per Kedia, “We have a dedicated training centre in Mumbai where all therapists undergo a three-month training programme before they are put on the job. Managers and front desk also undergo a training programme, which is a mix of classroom sessions and on-the-job training. Regular audits are also conducted to ensure service quality.” Apart from training, all the marketing activities are handled by Four Fountains. Regular visits are made to ensure that SOPs are being followed correctly and the service standards are maintained. Mystic Spa provides strategic planning and marketing consultancy, manpower assistance, training on soft skills/sales skills, back office support, etc.

Expansion

Location should be ideal for opening a spa where footfalls or walk-ins can be generated. For Mystic, at least 10 franchisees are planned by the end of 2011, targeting Delhi, NCR, Mohali and Jalandhar. Says Kedia, “Our target is to set up 300 spas by 2014. A significant majority of these would be through franchisees. Immediate expansion plan is for Mumbai and Pune. Delhi, Bengaluru and Chennai are being planned for in the coming calendar year.”

Exit option

In case of Mystic Spa, the franchisee cannot resell the business. In such a scenario, company can take over the business or can take care of the business by giving some percentage to the franchisee. Four Fountains, however, doesn't encourage the change of hands.

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