parrot head

If I'm grossing $150,000, I'm putting 50% of that in my pockets, or I'm closing the doors. 30% ain't worth the effort.

peach

If it is your sole source of income, I would totally agree. If it is a secondary income, you may be able to get along with less.

The answer is that this may not be a dying industry but it is definitely a shrinking industry. How far it shrinks is going to be determined by what the industry does in the next 5 years. That is where the concern is. It doesn't look hopeful.

Look at what coke is doing-they are under the same pressure as we are. How are they handling it? Far better than we are I am afraid.

Good_Guy

Is tanning really being outlawed in some countries like Australia? Or have I been misinformed?

peach

Yes, Some provinces in Australia have banned indoor tanning.

Steve Underhill

The tanning industry is not dying. How we do business as tanning salon operators is changing.

Remember that tanning started with basically no rules. Because of this making money in tanning spawned a lot of shady activity.

Here is what should always be considered. People want to tan, have a tan and enjoy all of the benefits and feelings associated with having a tan. Therefore there will always be a tanning customer.

Because of rules, regulations and a much more discriminating tanner the tanning industry is reinventing a successful business model.

Old salons are closing because they do not know how to or are unwilling to adapt. Many new operators are failing because they do not posses the knowledge to succeed. But there are those operators new and old that understand the importance of having a proven business model, are prepared to adjust operations when needed and most importantly understand how to market tanning to todays tanner.

There are struggling and failing salons and there are thriving growing salons. The difference is the understanding of the tanning industry, todays tanner and plan to execute each and every day instead of doing nothing and hoping things will change.

Your success is a result of your efforts. When all is said and done the remaining manufacturers, distributors, new and used and the salons that understand that there will always be a tanning customer and how to best accommodate and reach that customer will be operating successful business in an industry that can be a lot of fun.

Don't loose sight of the fact that vacations, back yard and public pools, beaches and yes the tanning salon that are the most affordable way to achieve a tan are all focused on people getting that beautiful glow that when a person looks in the mirror says I look great. Almost every consumer product is based on vanity.

Now ask yourself, is tanning really a dying industry or is it simply restructuring?

As long as we know the rules we can play the game. Rules sometimes change.

__________________
Stephen Underhill
Consultant
steve@smuconsulting.com

Good_Guy

Great post Stephen,

I'm interested to hear more of your opinions. So what are the new changes? What is working? Is the Sunless business replacing UV? Are the margins in Sunless comparable to UV and sufficient to make a salon thrive?

Is government slowly squeezing out the industry as lobbyists do their job? Is Australia and it's banning of commercial tanning in some provinces the start of a trend that could reach North America?

MegaSun8

I have been in the tanning industry since 95 nearly in every area from Salon owner to consulting to salon equipment and store set ups..One problem I see is salons think hey customers are going to run throw the money down and yaaa They made money..Next issue is are you nuts spending $500000 on ten bed store..Salon owners lost suight opf the real goal provide a service at a fair price and resonable over head cost..Look at Ergo lInes old model let us show you how to break even on a $30000 to $50000 bed...Your parts are to exspensive ...Every one crys about the tax well keep it real you most likely hide more money so you break even any way...As to minors...Yes they shouldnt be allowwed to tan with out parent consent just like a rated R movie..And nasty magazines even music....Times are changing people I hope are getting smarter in the right areas....Fact is when I sarted tanning we tanned on simple 24 lamp beds ten days in row at moderate tans and BLAMMOOOO same tan as we get today....Customer only sees the out side of the bed for 3 min they see the tan all day ..think about..And plus as you all some what cry about President and who ever..its us you are causing the problems..You purchase Ergo Line and support Germany Sportaredo and support Italy..You purchase NIKES and support every one put your own country dont say boo who we dont manufacture it then go with out and force are country to be Americans NO SELL OUTS

Steve Underhill

You do not need a 20 - 30 bed salon to be successful. Shorter exposure times and tanners that are leaning more to up-grade tanning than base equipment tanning. Control over head.

In the past reaching the tanner was time consuming and very costly. Today you can reach the consumer instantly and affordably.

Transitioning to reach the new consumer as well as the old school consumer that we will not outgrow for many years is important.

When we advertise and what we advertise is important.

I also find the single most important thing for increasing sales is your price structure in relationship to your equipment mix. You must understand when and how to discount.

Also never loose sight of the fact that you are selling the trip not the destination. The packaging of your salon is monumental.

Now hire the right people and provide a consistent level of training and motivation.

Obviously there is detail in accomplishing each of these areas.

Yes UV free is a major ingredient for success. Important to have spray booths that are not constantly broken and dealing with manufactures that offer little or no support.

__________________
Stephen Underhill
Consultant
steve@smuconsulting.com

peach

The most important components to cost control in the tanning industry is the purchase and maintenance of equipment. That is where average the salon owner doesn't get it. The equipment that the industry and consultants push on us is overpriced and so complicated, that no one can work on it or maintain it without help. (not to mention the costs to alter your facility to accommodate them.) You can have a 30k machine that tans the heck out of you, but no one will get in it because the mister won't work, or you can't use the spray booth because it's on board computer gives you an error code. As a salon owner, it is not a question of if, but when your equipment is going to fail. And, the more complicated it is, the more likely they are to break and stay broken for long periods of time. No manufacturer is going to come and fix your equipment for you. You will either have to fix it yourself or pay someone else to do it. As a salon owner, you had better think about that before you jump to buy the latest 35k bed or spray booth. This is why people think that you have to invest 500k to compete in this industry. (which is totally false)

BigLeo

Thanks everybody for your valuable input on the condition of the indoor tanning salon industry. Yes, I agree that the industry has shrunk. I estimate that over the last 10 years revenues have declined by about 4% per year or about 40% overall. This would mean that tanning salon industry revenues are really about $3 billion per year. I'm including revenues from the salons, salon equipment manufacturers and tanning lotions. This is a far cry from the $5 billion that the ITA keeps quoting year-after-year, since I can remember. Judging from the responses, declining profitability margins are a real concern. I agree that the equipment costs too much and difficult to maintain. What this tells me is that there is no innovation in the industry to bring down capital expenditure costs and lower maintenance and efficiency. I have never encountered an industry to burdened with bad publicity and regulation than tanning. Somebody mentioned that a lot will depend on what happens over the next five years. Why wait for the five years to come. If you can get out, my suggestion is do it now. Again, thanks for your input and comments. This has been a very sobering experience.