After lagging other hotel revenue sources, hotel spas saw sales recover in 2011 and the trend is expected to continue as the economy rebounds, according to PKF Consulting USA.
In its "Trends in the Hotel Spa Industry" report, PKF said hotel spas enjoyed an 8.3 percent increase in department revenue in 2011, after suffering declines the three previous years. In contrast, rooms and food and beverage revenue began to climb out of the industry recession and post revenue growth starting in 2010.
The beginning of the recovery in 2011 was enjoyed by all types of hotel spas regardless of location, volume of revenue, or size of the facilities, the study said. Analyzing the data by hotel type, PKF observed similar revenue increases for spas located in resorts ay 8.4 percent and urban hotels, 8.2 percent.
Massage services continue to generate the most revenue for hotels spas, the study found. Sales from massages averaged 57 percent of total department revenue and grew by 9.2 percent from 2010 to 2011. Other significant spa services enjoying strong growth in revenue during 2011 were skin care and body work , 8 percent, salon services, 8.1 percent, and retail at 13.4 percent.
Urban and resort spa managers limited the growth in total departmental expenses to just 5.5 percent during 2011. Like most operating departments within a hotel, labor costs are the single largest expense item for spas. In 2011, the combined costs of salaries, wages, bonuses and payroll related expenses equaled 55.6 percent of spa department revenue, or 72.9 percent of total departmental expenses.
Managing labor costs in a spa is challenging, the report found, adding that inconsistent timing of appointments leads to erratic scheduling and elevated use of part-time and contract employees. Researchers were impressed that labor costs rose by just 4.9 percent from 2010 to 2011 despite the 8.3 percent rise in department revenue.