Ms. Curtis

Spas, Health & Fitness

Spa Retail Management: Creating a Strategic Retail Plan

By Nina Curtis, Founder & President, The Nile Institute

Creating the Strategic Retail Plan

Through the months, I have written on several aspects of spa retail management and this issue's topic on Creating a Strategic Retail Plan is crucial for the future success and sustainability of the spa as a strategic business unit (sbu) of the hotel.

As a sbu of the hotel, the spa's strategic retail plan should consider the overall strategy of the hotel and find ways to create a congruent plan of action so that seamless results are achieved. This sends a dynamic message in the branding of the spa as a cohesive unit.

The strategic retail plan aims to create a long-term plan of action that will provide an overall sense of direction for the spa and its retail activities. The spa's strategic retail plan can be considered the "blueprint" for ensuring success in all of the spa's business endeavors.

The strategic retail plan is focused on achieving a strategic fit between the spa's capabilities and opportunities in the market place both present and future. A solid fit positions the spa for sustainability and allows it to overcome environmental competition. This focus also allows the spa's management team to recognize market changes and demands thus allowing for internal adjustments as necessary.

Key components of the strategic retail plan include; (1) the spa's mission, (2) the spa's objectives, (3) the spa's capabilities and (4) the spa' opportunities.

The Spa's Mission

The spa's mission is expressed in the mission statement that is created to capture the essence of the spa's present and future purpose. It states what the spa promises to deliver.

A well defined mission will answer such questions as; What is our business? What does our business deliver? What are our responsibilities? Who do we serve? And how do we meet the growing needs of our clients?

The mission of the spa and its expressed mission statement, while it strives to maintain a consistent focus must be flexible enough to adapt to the every changing climate of today's environment. If you express something "written in stone", it will be challenging to stay abreast of the changing demands in your marketplace. You must know you core intention while staying progressive with the times.

It is crucial for the entire organization to "buy in" to the spa's mission for your purpose to be fully executed. People must know, understand and agree to the purpose of their work as it is defined in your mission statement. This means that you have to take inventory on a regular basis to identify if the spa's mission is truly a living reality.

If you already have a spa mission statement re-evaluate its value as a living truth. If it does not match the reality of your business consider rethinking what your purpose really is. If you are just beginning to consider your spa's mission (purpose) and working on developing your spa mission statement, consider these additional questions. (1) What is our business? (2) What is our business positioned to be? (3) What should our business be? (4) Who is our client/guest? (5) Who will our client/guest be? (6) And who should our client/guest be?

How congruent is your spa's mission with your hotel's mission?

The Spa's Objectives

The spa's objectives are defined as the strategic positions to be attained by the spa. There are several key areas to be considered.

The spa's market objectives are focused on the acquisition of client/guest patronage and at achieving a competitive position in the marketplace. The spa's market objectives are achieved through carefully planned retail merchandising programs that will satisfy the client's/guest's psychological, social and personal needs.

1. Sales objectives are outlined to increase a certain percentage growth for the entire spa over a period of time through increasing treatment and product advertisements, improving treatment and product offerings and creating strategic alliances with other sbu's in the hotel.
2. Another sales objective would be to increase the average client/guest sale.
3. Personal selling and sales and merchandising promotions are presented here.
4. Client traffic objectives are defined to (1) increase the total number of client/guest visiting the spa during a specific time period (2) the specific client/guest groups targeted for special attention (conference groups, women's groups, event groups) (3) increase total number of local clients/guests who live in the area.
5. Client loyalty objectives are focused on ensuring the return of clients/guests to the spa. Repeat business is essential to the operation as it represents spa loyalty and the high preference level for the spa and its merchandise offering. It cost much less to keep a 'delighted' guest then it does to have to attract a new one.
6. Market share objectives allow the spa to express its competitive position relative to all competitors within the same market. In such competitive times, objectives must be set to retain one's current market share while working to find competitive ways to increase overall market areas.
7. Retail impression objectives are developed to create a positive mental picture in the client's/guest's mind. Retail impression objectives should be established to create a symbolic representation of the spa's attributes, orientations and activities. By offering higher-quality treatments and merchandise, better use value, more result oriented services, and delightful experiences, a spa can competitively position itself in the minds of current and potential clients/guests.
8. Vendor relations are key to creating viable competitive positioning. Spas should strive to ensure that they are well positioned with both established vendors and innovative emerging sources. These objectives will prove profitable as the spa gains respect from these vendors as preferred accounts and desired business partners. The spa's financial objectives are directed at ensuring that the spa operates profitably and productively. Financial objectives will provide quantifiable measures by which the spa's performance will be reviewed. As a sbu of the hotel, the spa management team should be in alignment with the financial objectives of the hotel to a large degree. Three of the most critical resources that require careful management in the spa will be labor, space and treatment and merchandise offering. It will be crucial to gain the support and backing from the spa's hotel to meet the every changing financial demands of the spa. Meeting on a regular basis with the hotel's financial team will keep lines of communication open and financial objectives can be met for the short and long term of the business.

Labor productivity is intense business in the spa-hence the contribution of human resources must be recognized and productivity performance standards established. A high attrition rate in the spa can adversely affect labor productivity so setting employee satisfaction objectives should be designed to increase employee retention.

Space productivity represents the amount of available merchandising and operating space in the spa. The spa must attempt to maximize its selling space and productivity to fully realize it financial objectives. One popular measurement of space productivity is to identify the spa's net sales per square foot of floor space.

Merchandise productivity is measured by inventory turnover. It can be defined as the number of times during a specific period (a quarter) the merchandise on hand is sold. The desired objective is to achieve the highest possible inventory turnover rate in the shortest period of time. This demands a thorough understanding of the retail product mix, its benefits and offerings and the sell-through of products in conjunction with the spa treatment offerings.

The spa's societal objectives as they relate to your organization's core values and social responsibilities are gaining more importance on a global level. What contributions a spa makes to its community and its consideration of the environment as a whole are being looked at through magnified lenses. Identifying what is most important for your hotel and spa will prove to be a progressive strategy for your organizations success and sustainability.

The spa's capabilities are the collection of core competencies that identify the spa's competitive position. Here you will want to take inventory of your spa's strengths in overall service offering to include treatment and products. What differentiates your spa in the market place? What intellectual property do you own? What is your selection and uniqueness of treatments and merchandise offered? What is your reach and effectiveness of client/guest communication? What is your image and reputation as a spa? All of these questions will clearly identify your current situation and allow you leverage to your strategic retail plan.

The spa's opportunities must be included in the spa's strategic retail plan to include; (1) market penetration; to increase sales productivity with existing markets. (2) market development; to expand into new market levels and (3) product development; to expand and enhance the current treatment and product offering to both attract existing clients/guests and new potential markets.

The importance of creating a strategic retail plan can now be more clearly understood and the key steps to moving forward outlined in the article can be used as a guide for creating a dynamic and robust strategy that will allow your organization to realize its fullest potential.

Founder and President of the Nile Institute, Nina Curtis has worked in the personal care and spa industry for more than 25 years. She holds certifications in aromatherapy, reflexology, acupressure and color therapy and was instrumental in developing of training programs for salons and spas across the country. As principal of Curtis Communications, she consults for leading companies in the personal care industry. Ms. Curtis earned a MBA from Pepperdine University, and sees the value of learning business skills that are directly applied to the spa a nd hospitality industries. Ms. Curtis can be contacted at 310-275-6453 or curtiscomm@earthlink.net Extended Bio...

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