Renting Out the Hotel Spa
Renting Out the Hotel Spa
Opulence by Pure Medical
The 5 Benefits to Renting Out the Hotel Spa
It is no secret that the Spa industry recorded huge losses due to the pandemic. By the end of 2020, the spa industry lost $7 billion in overall income. Between 2020 and 2019, the drop was around 36.4%, from 19.1 billion dollars at the end of the year in 2019 to $12.1 billion dollars in 2020. Spa visits also decreased significantly between 2019 and 2020. Spa visits totalled 192 million in 2019 and 124 million in 2020, according to a recent survey conducted by McKinsey & Company.
According to IBISWorld research, spa revenue fell by an additional 7.7% in 2021 as a result of weakening demand caused by the difficulty to properly socially distance owing to the nature of the industry. Pure Medical is bucking these trends with our unique medical spa facilities.
As the sector navigates the post-pandemic landscape,
renting out the hotel spa is a terrific alternative.
Have you considered renting out your hotel spa?
As a result, hoteliers preparing for the travel recovery may be wondering what will happen to their spa space. To put it bluntly, in today’s dramatically altered environment, pre-pandemic procedures will not add to the bottom line. If hotel operators were relying on spa money from hotel guests before COVID-19, they must accept that demand is unlikely to return anytime soon. It’s time to adapt.
The following are five advantages to renting out the hotel spa to a third party.
5 BENEFITS TO RENTING OUT THE HOTEL SPA
1, RISK MITIGATION
When hotel owners are deciding on renting out the hotel spa, they are taking on less risk and reaping greater benefits. Someone else is in charge of the operations, as well as the working capital.
A hotel spa’s payroll might run into hundreds of thousands of pounds. Owners must consider whether this is the best use of their money, which is even more crucial today than it was a year ago. In addition, the spa will incur additional costs as a result of applying new cleanliness criteria from the UK health security agency (UK- HSA) and the UK and the European Centre for Disease Prevention and Control (ECDC). Owners don’t have to invest the money to get everything up to speed and ready to meet these requirements and alter visitor expectations in a rented model.
2, RENTING OUT THE HOTEL SPA PROVIDES A GUARANTEED REVENUE STREAM
Depending on how the lease is arranged, spa owners can receive a fixed rental income, or alternatively a percentage of earnings, or both when they rent out their spa facility. This means that owners will receive a guaranteed cheque and will be able to share in the growth of the spa’s income without having to do anything but maintain the space.
When it comes to hotel services, it’s no secret that revenues can fluctuate. However, it is easier to show a lender a regular stream of income from a spa rental for those owners who need to apply for a loan, which in the current climate has become significantly harder.
3, ALLOWS OWNERS TO CONCENTRATE ON THEIR CORE BUSINESS
Revenue and labour are the two key elements at play in hotel spa operations. Both of these are quite questionable in the current climate. There’s a lot of uncertainty about labour availability, especially skilled workers. Furthermore, the return of spa demand, as well as the type of demand that will return, are both unpredictable. Is it going to be hotel guests? High-value leisure? Or the local market?
As travel picks up again, hoteliers will need to focus on increasing income by filling their rooms. At the end of the day, as the hospitality industry recovers, the spa will not contribute significantly to a hotel’s bottom line. While the hotel operations staff is troubleshooting how to avoid losing money in the short and long term, getting the revenue and labour portions right could take time and focus away from them.
Renting out the hotel spa shifts all of that responsibility to someone else, who decides how to price treatments, hire competent workers, and put up their own money for payroll.
4, LEASING OUT THE HOTEL SPA PROVIDES ANCILLARY SPENDING OPPORTUNITIES
The leaseholder is motivated to increase custom at the spa. Even if there are no spa customers, they still have to pay the rent to the hotel owners. That means they’ll go to any length to lure customers through the spa’s doors.
A reputable spa partner can tap into the local database to help the hotel gain greater exposure. When customers visit the spa, they frequently stop at the hotel bar for a drink, to pay for parking, and to do other things. Without any effort on the part of the hotel staff, the increased footfall can contribute to the property’s bottom line through ancillary spending.
5, IT ENSURES A SMOOTH GUEST EXPERIENCE
Consumer behaviour has evolved as a result of the pandemic, making the visitor experience more important than ever. Owners don’t have to worry about the link breaking if they’re leasing out the hotel spa. The Leaseholder can adopt brand norms and culture so that clients don’t realise the spa isn’t run by the hotel. An excellent spa partner will have a supportive management team, with leaders who attend hotel staff meetings on a daily, weekly, and monthly basis, resulting in a smooth guest experience.
CHOOSING A REPUTABLE SPA PARTNER
Hotel owners have a lot on their plates as the business adjusts to the new normal during the recovery phase. They must not only reconstruct a full hotel organisation, but they must do so with a significantly smaller crew. Many business owners may discover that they do not currently have a spa team.
A good spa partner can take the risk off the hotel owner while also supporting the owner’s bottom line in today’s new and unpredictable landscape. It can also provide much-needed relief after all of the uncertainty.
