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Issue link: https://dayspamagazine.epubxp.com/i/311523
98 DAYSPA | JUNE 2014 PROFIT CENTER of your customer service and branding initiatives, the way that clients feel when they receive treatments at your spa, and the sense of community that stays with them once they leave. These components are impos- sible to comparison-shop. Spa Gregorie's, with three locations in Southern California, has adopted a formula of sorts for arriv- ing at service prices. "Although it's getting tougher to decipher when and how to increase your product and service prices," notes president Scott Duncan, "it's also important not to undervalue your brand, all while competing with the ever-increasing array of discount and membership stores. At Spa Gregorie's we look at what local destination/resort spas are charging, as well as what the membership-type massage shops charge. We also consider the consumer's perspective of value in terms of quality: the training of the therapist, the length of service time (whether massages are a full hour or 50 minutes, for example), and the amenities available to the guests. It's important to understand who you are as a company and how your client base perceives your brand." Colleen Rose, owner of Yoga360 Spa in Frankfort, Illinois, stresses the importance of considering the hard costs of performing a service when setting prices. "We fi gured out how much our costs were for the treat- ment room, including the rent, and knew we wanted to charge at least $1.25 a minute for the service time. We also looked at the skill level required; for example, our ayurvedic services are priced higher because they re- quire much more training." Of course, the COGS (Cost of Goods Sold) should be considered in your pricing strategy, but spas lack a clear formula such as the one As a spa consultant for the past 14 years, one thing I've often observed is spa owners' tendency to feel that pricing needs to fi t into a "divisible by fi ve" pattern. More spa menus than I could count offer prices of $80, $85, $90, $95 and so on. There's really no reason for this, as there are plenty of other numbers we can use! If we offer our clients a wider choice of prices, they're more likely to fi nd the "right" price for them, in a smaller range for us, e.g., $85, $88, $92 and $96. Plus this approach sounds like a little bit of science was applied, rather than just rounding up or down to the nearest fi ve. —Lisa Starr Author's Tip dayspamagazine.com/freeinfo • Use FreeInfo #38 P r o f i t C e n t e r . i n d d 9 8 Profit Center.indd 98 5 / 1 / 1 4 3 : 4 3 P M 5/1/14 3:43 PM