January 3, 2024

Creating a Med Spa Business Plan: Steps to Get Started

Moxie Team

If your goal is to open a med spa, you probably have a lot of questions that need answers, like: How much will it cost? Do I need to find a medical director? Who is my target customer and how do I find clients?

A great way to start answering these questions is by putting pen to paper. Drafting a medical spa business plan is the perfect place to begin getting organized and answering key questions.

With a medical spa business plan, you can apply for financing, lock in fruitful partnerships, and better identify your path to success. 

Start thinking about your med spa business plan with step-by-step guidance. Let’s talk about fundamentals.

Essential elements of your med spa business plan

1. Identify the opportunity

The first step to starting your own business is identifying an existing problem and how you’ll solve it. Opening a med spa helps to meet the increasing demand for aesthetic procedures, but getting into specifics helps to zero-in on your unique approach and opportunity.

Here are some questions to ask yourself before getting started:

  • What are the gaps in the local market? Identify your advantages and position your medspa in a way that separates you from others in the area.
  • Who is my ideal customer? Consider who your ideal client is so that you can tailor your marketing to them directly.
  • What are my customer’s pain points? Consider the potential pain points of your customer—like seeking high-quality service with a reliable provider—and how you can best address them (hint: read your competitor’s online reviews to see how they are missing the mark and how they are winning).
  • What sets my business apart? Do you want to focus on providing high-quality treatment? Great prices? Better, holistic 1:1 service? Maybe choosing one treatment niche you can “own”? 
  • What services would I like to focus on? Do you envision yourself operating a botox spa, or are you more interested in working with lasers? Follow your passion, but do some market research to determine which services are most popular, and what is or isn’t being offered locally.

2. Marketing 

Marketing is essential to a successful business of any kind, and when opening a med spa, it’s a non-negotiable.

Firstly, you’ll want to suss out your competition—who they are, where they are, and what they offer. By understanding your competition, you can effectively position yourself in opposition to them and attract customers by differentiating your services. Identify their weaknesses and make them your strengths!

Once you’ve determined your market positioning, it’s time to consider how you’ll market your med spa. 

Essential med spa marketing activities:

  • Build a website: A website is the first step to establishing your online presence. It’s your 24/7 storefront. It should look professional, tell a story, and make booking easy.
  • Set up social media profiles: Expand your online reach and the amount of clients you can connect with by setting up profiles on social media. Check out our full guide for more tips and tricks to build your med spa’s social media presence.
  • Consider your content: Your social media profiles should feature a selection of carefully curated content that corresponds to your customers’ needs but also comes across as authentic. Be sure to include before and after photos, patient testimonials, and lifestyle content. Here are best before and after photo tips for growing your visual content!
  • Plan a grand opening event: This event will help to establish your business within your community, lets you network with other business owners and potential clients, and generally raises awareness of you and your services. Check out our full article for all the information you need to plan your med spa launch party.
  • Offer a membership program: Encourage loyalty to your med spa and build a rapport with your clientele by offering a membership program. Other practices have seen their average patient visits nearly double by employing this method!

Check out Moxie’s guide full of helpful tips and tricks to make your med spa’s first year (and beyond) a success!

3. Financial planning

While you may not have a spare $50K sitting around to fund your startup costs, keep in mind that med spa financing is available in the form of med spa loans as well as other options. 

Still, it’s important to determine what your costs will be, how much funding you’ll need, and how to prioritize your spending.

Questions to ask yourself:

  • Where am I planning on opening a med spa? The first thing you’ll need to think about is finding a space. The cost of your med spa location will depend largely on real estate rates in your area. Start small with a clean, comfortable space where you can greet and treat your clients.
  • What med spa services will I offer? Your service offerings will determine with equipment and supplies that you’ll need to acquire before opening your doors to the public, and will be a determining factor in your final budget. 
  • What med spa equipment will I need? On average, you can expect your equipment to cost $30 per square foot, and potentially higher if you plan on offering luxury services. We recommend starting with the basics, then adding to your arsenal once you’ve got some cash flow!
  • Do you want to buy or lease med spa equipment? With a strong resale market, buying med spa equipment can be a solid option, especially if you manage to secure funding. However, leasing also has its advantages—namely, keeping overhead down while giving you the freedom to trial different equipment.

4. Tools and equipment

Your tools and equipment will determine the quality of service you’re able to offer, so don’t skimp. 

Here are some of the tools and equipment to factor into your budget:

  • Electronic medical records (EMRs): Using an electronic system can help you to keep track of your patients, make sure they’re scheduled for follow-up appointments, as well as track patient data. Some EMRs also include built-in point of sale components that can process payments and automate your marketing efforts, making them well worth the investment.
  • Light and laser-based systems: These systems are used for laser hair removal and skin rejuvenation, which remain some of the most popular med spa procedures. You can find this equipment secondhand, saving you 50% to 70% of the retail cost
  • Injectable supplies: Neuromodulators are all the rage these days, with clients regularly seeking out these procedures to reduce the appearance of fine lines, wrinkles, and other signs of aging. The US Botox market size was valued at $5.91 billion in 2021 and rose to $6.27 billion this year—and is projected to grow to $8.59 billion in 2029.  Compared to other med spa procedures like lasers, injectables require a much smaller investment up-front, delivering high ROI for your burgeoning business.
  • Med spa furniture: When furnishing your first office, your priority should be comfort and practicality. We recommend a clean, minimalist aesthetic that prioritizes your clients' needs. Review our checklist for a full run-down of med spa furnishings and supplies. 

5. Measuring success (milestones and metrics)

The key to a successful startup lies in minimizing initial costs and maximizing revenue from the outset. Marketing, particularly digital marketing, is crucial for lead generation and revenue creation. Metrics like cost per conversion in digital marketing are vital for understanding the effectiveness of your marketing activities. 

Metrics to measure your med spa’s success:

  • Revenue: Maintaining sufficient cash on hand is crucial for the first year, ensuring the business thrives until it reaches the break-even point. Whereas most businesses aim to be profitable after 5 years, it’s possible to achieve break-even within 9 months to 1 year and profitability by year 2 through careful attention to overhead expenses and minimizing startup costs.
  • Return on investment (ROI): Your ROI indicates the return you are seeing for your investment in marketing efforts. Calculate your ROI by dividing your net profit by your 
  • total investment—for example, if you spend $100 on a marketing campaign that generates $500 in profit, your ROI would be 5. 
  • Average monthly leads: Having an idea of how many leads you acquire in an average month will help you to identify abnormalities and marketing successes. Leads—whether from digital ads, social media, or word of mouth—should increase month over month. Find a tool to track leads via Meta, Hubspot, GoHighLevel, or your preferred CRM.
  • Return on ad spend (ROAS): This calculation determines the effectiveness of your ads, an important metric for any small business. To do this, simply divide any ad campaign-generated revenue by the amount you invested in them.
  • Net profit margin: Net profit margin = (net income / total revenue) x 100.                       In order for your business to be profitable, your expenses need to be lower than your revenue. You can increase this margin by offering more services, selling products, or lowering your overhead costs.
  • Customer satisfaction: What do your Google, Yelp, or social media reviews say? It’s important to build up positive reviews. They will help you grow organically and legitimize your business (and even SEO web rankings).

Building your own medical spa business plan

Take it one step at a time and plan out what your successful medspa will look like with a thoughtful, well-researched med spa business plan. 

Remember, you’re writing a business plan, not a memoir! Keep it concise and to the point, and before you know it, you’ll be one step closer to confidently opening a med spa.

Reach out to the team at Moxie today to learn more about opening a medical spa.

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