Spa for sale - the advantages and risks of buying an existing business

Spa for sale - the advantages and risks of buying an existing business

Owning a spa does not necessarily have to begin with establishing your own business from scratch. For many specialists, both the beginners and the ones already experienced with running their own business, buying a pre-established spa may be a tempting option. Such a solution has its perks, that’s for sure - but it also comes with very peculiar disadvantages you should be aware of before you start browsing for spa businesses for sale. Let’s analyse the pros and cons of purchasing an existing business to see which offers are actually attractive, and which can only bring you losses.

Before we jump into it, let’s establish one important fact first - depending on the circumstances, some advantages of becoming an owner of a pre-established business can easily turn into disadvantages. You’ll see what we mean in a minute, but the point is - you always have to look at things through the lenses of your own, personal situation.

Pros of buying an existing spa

The main advantage of buying a pre-established spa instead of developing it from scratch is that you start working right off the bat, so the profit comes your way quickly. Moreover, you obviously don’t have to worry about many things, such as interior design, buying equipment or even creating branding - unless, of course, you want to make some changes. You usually also have the “paperwork” (different types of licenses, spa insurance, lease agreement) in place, at least for a while, which is also a great starting point.

Established position on the market

An existing business, especially if operating for quite some time now, has already established itself as part of a local community. Which means that brand awareness is already there and you don’t have to invest as much in getting the word out about your spa. Now, this is one of those “double-edged swords” we’ve mentioned earlier - an established position does not always mean a positive one. But let’s leave this point for the later discussion - now let’s assume that the spa for sale you are looking at has a great opinion locally. It’s a huge starting advantage and definitely a tempting perk of purchasing a pre-established business.

Business relationships

If you have run a spa before, you probably have a network of suppliers, trade people, insurance providers, banks (and so on) you know you can count on. However, if you are a first-timer, establishing business relationships should be your number one priority.

A team of specialists

An organised team of well-trained, qualified professionals is a big advantage - especially if it’s your first foray into business ownership. Great employees are worth their weight in gold, especially if they already know how to cooperate with one another and have great work hygiene. However, it’s yet another “double-edged sword” - if you are getting a team with a terrible work ethic and tons of swollen, unresolved conflicts as a bonus, you are going to have a terrible time (more about it later).

Structure and processes

If the business in question comes with a team of experienced professionals who are managed by great team leaders and it seems like everything goes smoothly, the previous owner had most probably established some effective processes and procedures. Staff members know what to do, the documentation is clear, the policies are rational. Such a situation is a big perk and will not only make your role as the spa owner easier, but will also help you to develop your own skills by observing how good processes work in practice.

Sound income

If you are keeping an eye on a particular offer, always begin with checking the true profitability of the business in question. It’s a truth that needs to be stated - sometimes the reason someone is trying to sell a spa is that it only brings them losses. However, it is not always the case - you might purchase a business that ensures financial stability, which allows you to not only keep going, but also keep developing.

Risks of buying a pre-established spa business

If you are someone who likes things to always be done “their way”, purchasing a pre-established business may turn out to be a rough ride for you - especially if the business in question comes with employees. It might be hard to adjust the pre-established work culture to what you want it to look like. So the main big con of such a solution is that you either have to deal with the pre-established elements or make an effort to change what you dislike - which sometimes takes even more work than doing everything from the beginning.

Bad reputation

It’s one of the aforementioned “double-edged swords”. Sometimes a business owner wants to get rid of their property because there’s just too much drama surrounding it. It can be anything, from poor customer service to actual frauds. A new owner may introduce different ethics, but it’s hard to change the opinion of the general public. Always do your research before you start thinking seriously about any spa for sale!

Financial struggles

Sometimes, even a business that employs great specialists and has many clients experiences losses. When looking for a spa to buy, mind its location, services it focuses on, target audience, and so on. There are many factors that contribute to whether a spa is profitable or loss-making. Some of them you will be able to change, but others you can do nothing about. Take a look at the last two years of the spa’s account - if it’s not looking well, try to analyse what may be the reason. And don’t let your enthusiasm blur your judgement - you may think that all the problems come from poor management and you’ll be the saviour who will lead this spa to prosperity, but there’s usually more to it than it may seem at the first glance.

Poor overall state

If the previous owner cut corners wherever they could, your spa in spe may not be in the best condition. And not all negligence is easy to notice. Chipping paint and upholstered furniture are super visible, but hydraulics screaming for renovation are not. In the worst-case scenario, the final cost of all repairs and replacements may exceed the cost of starting your own business.

Low work culture

With an existing business, you are inheriting an existing work culture. It may be amazing - but it can also be very, very poor. You may find that your new employees are used to processes and procedures that are completely different from what you praise and want to see in your business… or there can be complete chaos and slackness that will be difficult to tame. Once again, sometimes it’s much easier to establish something yourself than to try to change an existing state of things.

Problematic employees

People do not always get along well with one another. You may have different priorities and goals than your new team - and they are not always likely to willingly embrace all the changes you want to make. Still, it’s not the worst situation you can find yourself in. Your new employees may have serious conflicts with each other, be dishonest or completely unreliable. It wasn’t you who recruited them - but you have to take responsibility for them from now on. It may be difficult to get through. Finally, they may want to quit as soon as ownership of the spa changes - so you have to be very careful to not find yourself in a situation in which you are left with an entire business ready to go, but with no people to run it.

An alternative - a spa for rent

If you are not ready to face the aforementioned challenges, and are still determined to start a business without engaging entirely in the process of establishing it, there is an alternative. Many big spas offer rooms you can rent and offer your services in - you are an independent business owner but you are provided with a place to work in, sometimes equipment and other amenities. Once the rent is paid for the month, you manage your solo business in whatever way you see fit. It’s a great starting point and is much less risky than buying a pre-established business.

Whatever your final decision is going to be, Booksy offers plans for spas of all sizes - from solo practitioners to big businesses that employ dozens of specialists. It will help you face every challenge - from staff management to room availability. Start your free trial and see for yourself!