hansam

2 1/2 months into the tanning industry. Already had our ups and downs. Did our homework and research before purchasing business, but certainly missed some things.

The salon we purchased was a 10 year established salon and had a consistent following over the past years. Of course with most salons, there has been a dip in sales over the last 2-4 years due to multiple factors.

We have our own vision of what we want the salon to look like, things we want to add, change, etc. to make the salon hopefully a busier more profitable business over the long run.

I believe (taking type of industry out of equation for the moment) we have the business and marketing knowledge as well as good sales and management skills to build any type of business.

I am wondering the thoughts from others who have been in the industry for a while (almost anyone is longer than us) what they feel the future holds for the industry. Our plans were to move to another location up the road, new updated build out and to replace and add some new equipment to help drive more customers and revenue into salon that has no room to expand..

Over the last few weeks reading more on the tan tax, health reform, sites where many salon owners are either closing, selling or discussing being down 5-20% over last year, I wonder if spending another $50k in next 12 months to help next 5 years is a wise investment or not.

Do you think there is longevity in the indoor tanning industry (sunless or not)? Where will industry be 5 years from now? Will it stay steady, continue to drop 5-10% a year based on information from medical field? Not sure.

Again, I believe we have to tools and resources to build and run a profitable salon (if the business continues to be out there). But if trends continue to decline each year, is throwing $50k to try to build up the business over the next 5 years the right move, or keep $50k in pocket, minor improvements in existing salon and stay status quo ?

Yes, I know. It is the million dollar ? in the industry and none of us know for sure. But I have received and read a lot of good input from people on this site over last 3 months that at least may have a better indication (or at least thoughts) on trends in the industry than I do. Worth putting out there to see what you think.

!0 years ago we may have thought that Philip Morris would have stopped making cigarettes or be out of business the way they were slapped with fines, bad press, etc. However, even though I am sure they are not doing the same amount of business they were in the 80's, they are still a strong company.

Thoughts on the next 5 years for industry and putting in large investments now into your business?

Thanks in advance!

mickie

Cigarette tax didn't stop people from smoking, alcohol tax didn't stop people from drinking, and I don't believe this will stop people from tanning. But would I invest that kind of money into tanning? I don't think so. I believe tanning hit its peek in the 80's and 90's. I just enjoy running my salon making and average income

parrot head

Nobody can say with any conviction, that the tanning industry is here to stay. I would venture to say that in 5 years, there will be so much regulation of our industry, that only doctors will be owning tanning salons. Then we will find just how good tanning is for a persons well-being and health. I think the tanning business will continue to decrease with less people frequenting tanning salons. If the economy starts to recover, I think it will slow the decrease, but in the end, the stigma which we see with tanning will cause it's demise. Doom and gloom, yea maybe, but the handwriting is on the wall. No way would I put $50,000 into this business now.

unity

The irony being that when doctors are finally the only ones who can and do own salons it will suddenly be perfectly safe and okay to tan. And all the truth we know now will come to light.... because doctors now say it instead of us.

But the industry will continue to decline, there is no doubt in that. Some areas will do better than others and some areas will have growth. But as a whole it will decline. The question is where is the bottom. Is it in the next year or two. If the economy starts a fast recovery will there be a boom again? No way to know for sure.

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DB Hottie

Continued drop
Smaller scale salons
UV Client to Spray Client Ratio gets closer

Large salons will charge less to keep volume- but ultimately won't make much more than the little guy who has priced himself to stay in business with less volume.

The little guy who tries to compete with the large salon pricing will be sorry.

I would not pump 50K into UV now either. The decisions made by us now to adapt to the changing market, will probably dictate if we are here in 5 years. If you're not planning now- get to it.

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Find your zipper

Gkalka

Great question to ask .. I too purchased a salon thats been open for 17 years .. smaller community . but consistant business..
Came in upgraded the beds.. painted cleaned replaced fixtures and flooring and have been able to stop many of my clients from going to the next town . My salon has 5 beds 1 stand up and offers teeth whitning .. We are however going to add air brush tanning . I was at the same point you were .. But after reading many post i didnt even think of it . I upgraded my beds with beds with low hours that are a couple years old . it made the same impact as new beds since the salon i purchased had original equipment ( 17 years old )
If you need to suggestions on equipment to buy ect please feel free to email me. I actually have some extra beds i bought that i was going to expand into the space next to mine now but cant because the leasee is staying there .. My email is Gkalka06@aol.com

Gkalka

Where in Michigan are you ? I too am located in Michigan ..

hansam

Thanks for the advice/opinions. Definitely agree that have to change with times and get salon ready (back) into spray tanning which they did a few years back. Tough decisions since things we want to do we are limited to space where we are at. Along with being tapped out on space is the fact that to even upgrade any of the beds we would have to change the electrical from single to 3 phase which could cost around 5k.

So we find ourselves in situation of having no more room to add spray booth and if we want to upgrade bed(s) we would have to either search high to find single phase bed we want or purchase new. I believe with so many salons closing today, buying/leasing new would be a foolish mistake.

So we can move across street (has proper wiring already), rent is same, but in my best estimate, the build out alone would be at least 20k. Then you upgrade a couple of beds and add booth or mystic etc. and we are putting 30-50k in. If we do not, I believe we will stay same/flat for a few years and nothing will change.

We are doing marketing, advertising, websites, etc. to try to capture other business from competition which has never been done at the salon. That will help I believe, but we need something to be able to grab 5-15% from local competition. Only way I believe we can do that is to upgrade, add new and try to be the best we can in area.

Tough call either way. Almost feel like a crap shoot either way. ****** if we do or ****** if we don't.

I guess we have some tough decisions to make here over next few months but I feel if we just got into business we have to give it a shot and invest or it was a waste of time and money if we just let it be.

hansam

We are in North Oakland county. I appreciate your opinion/thoughts. You can email me what you have at kaplang@nationwide.com.

As well, perhaps I can pick your brain via email as well

Thanks.