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Several years ago, H-e-a-t Inc Spa Kur Therapy Development found that unlike other industries, the Spa, Salon & Wellness industry doesn't seem to have any "norms", and therefore it is very difficult to build a "Projected Profit & Loss" statement. Different pay systems, different rent situations; different markets, etc make it near impossible to draw any conclusions from one project to the next. Even if the industry average were published, our belief is that they would be useless to draw any conclusions from.
With a few basic questions, like: construction cost per square foot, how much you pay, what method you pay, what services will you offer, how much will you charge etc. We can break your facility up into what we call modules; both revenue modules like hydrotherapy massage room or facial room, and expense modules like front desk and waiting area. These modules cover every sq. foot of the facility and then and cover set-up cost of each, month-to-month expenses of each and expected revenue of each. We can then give you a "gross profit per month" "returns on expenses" and a "break-even" stated in the form of "hours of treatment" for each module built.
We summarize the data and can “play” with the mix of treatments (for extensive "what if calculations") and analyze the whole operation. “” calculates revenue, expenses, profitability, set-up costs, square foot analysis, man loading, and comparison of treatment-to-treatment profitability, break-even analysis, cash flow etc.
It will also generate a "pro forma PROFIT & LOSS" in standard accounting format, but broken down into far more detail than most projected PROFIT & LOSS STATEMENTS.
It gives you not just SERVICE AND RETAIL REVENUE and EXPENSES but also breaks them down by treatment.
“” has been written about in trade magazines and business schools have made inquiries because they believe THIS method of analysis may be applicable to other industries.
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