Here was your peak season 2014 at a glance: numbers down, hopes up and change in the air. As is always the case, there’s much more to the story …
Tanners were down four percent over last year and salon revenue was down seven percent … this was Vince Lorraine’s assessment of his 35-year-old Flint, MI-based Tropi-Tan salon chain’s performance during the first six months of 2014. Being a numbers guy, this got Vince thinking about how other salons across the country fared during the same time. He wondered aloud about whether these owners experienced an increase or decrease in tanning sessions sold, gross sales and average tanner counts. Having such information, Vince said, would be a good way to gauge the much-debated health of the indoor tanning industry.
Unfortunately, a complete breakdown of peak-season numbers cannot be accomplished. First of all, not every salon owner would be willing to share that info while others might feel compelled to inflate their results to save face. More to the point, a collection of numbers is just that, while the story these figures tells is most important. With this in mind, we asked a group of trusted owners of salons of all sizes how their businesses fared during this year’s peak season and what they believe might have affected their numbers one way or the other. The answers they gave us pointed to some very definite trends emerging in the sun businesses and by analyzing these, we have a better idea of what they must do to better prepare for their futures.
The “Big Boys”
The first group of salon pros we talked to are owners of large franchise and/or corporate-owned chains of ten or more stores. After all, seeing how the “big boys” are doing is a good way to get the pulse of the industry. Despite their infrastructure, training and proven business plans, these salon sector leaders survived a season that was more valleys than peaks, thanks to a variety of factors. Due to this downward trend, these owners are finding themselves making large and costly changes to their salon systems.
The 26-store California Sun chain wasn’t immune to the less-than-stellar season that many salons have experienced. Michael Blore, the company’s CEO, says the total number of sessions sold during the first six months was down 12 percent from the previous year, and gross sales were down seven percent for that same time period. And while May was his busiest month, he reports seeing four percent fewer tanners than he did last May. “The weather, economy and anti-tan message all played a part,” he explained, “but the teen tanning ban was the biggest reason for our declines. In its first year, it claimed a small percentage of customers; but in the subsequent years, it’s had a dramatic effect on the number of 19-25-year-olds who come to our salons.”
After 23 years in the business, Blore says he’s not about to cut-and-run after a weak peak season. Instead, he believes the answer is to embrace change while reinvesting in his business. “When I started, the average equipment mix was 80 percent level-one units and 20 percent upgrades,” Blore said. “Now, that percentage is reversed.” Apparently, tanners at California Sun want optimum results in less time, both in session minutes and salon visits. As a result, Blore plans to update the equipment at many of his older stores. He said, “It will take time and money but I’m willing to reinvest in my business to make it the best it can be.”
Downsizing is the name of the game for the 23-store Tanning Bed salon chain of Buffalo, NY. CEO Dan Humiston says fewer people tanning meant having to close and/or consolidate eight of his salon locations this year. He’s also in the process of downsizing his existing stores, many of which have 5,000 square feet and more than 30 tanning units each. Humiston said, “Since we’re a small, profitable company trapped inside a big, unprofitable company’s body, this is what we have to do. Still, it’s not easy going to your landlord and asking if you can cut the size of your store in half.”
As to what hurt his business the most this year, Dan blames Mother Nature. “Unseasonably cold weather during our first quarter had a huge effect,” he added. “We were closed a total of nine days and we found it difficult to regain our momentum after that; people just weren’t thinking about going out to do anything, least of all tanning.”
Mid-level Movers & Shakers
Salon pros who own and operate strong regional chains of two to nine stores are some of the hardest-working people in this industry. Lacking the infrastructure of tanning’s big boys, these mid-level movers and shakers tend to be more hands-on in all aspects of their businesses. And they’re eager to maintain their current empires or even grow them to a size that rivals the bigger chains. While it’s hard to defer the dreams of this ambitious lot, this year’s lackluster peak season wasn’t their finest hour.
Rocco Viele’s six Suntan City franchise salons in Rochester, NY didn’t do as well as he’d hoped this year. Business was “slightly down,” he says, in total number of UV sessions sold for the first six months of 2014 and gross sales and number of EFT customers. The only thing that was up was the number of tanners served on average during his busiest month and that, Rocco reports, was “just a little.” He said, “Our biggest problem was a lack of new customers. Gyms that offer tanning memberships are hurting my business; several of these in my area offer 24-hour tanning plus other benefits for an additional $10, which is a tremendous value for young people.” The current situation has Rocco unsure of any expansion though he believes diversification will be the key to his future success.
Mark Furniss knows the struggles of the small, regional salon chain quite well. He recently closed two of his Tropical Isle Tanning salons in W. Central, IL. Now, with four stores to operate, he reports that gross sales were down between 12-20 percent this peak season over last and customer counts were down about 20 percent. “I blame the three Ts: the Tan Tax, teen tan ban and trends,” said Mark. “For example, one of our locations we closed was near a college that recruits students from demographic groups that don’t typically tan, which meant less and less people were using that store.”
Despite setbacks, Mark and his wife Dena are committed to making the most with their four salon locations. This means having a strong focus on professionalism. He said, “Lack of training is perhaps the biggest problem facing this industry. All of us have to do everything we can to present a more professional image of our business to the public; it’s the only way to counteract the media’s message about indoor tanning.” In addition to staff training and certification, the couple plans to increase their EFT membership numbers, which is currently 30 percent of Tropical Isle’s client base.
The “Mom-and-Pops”
The small, one-location salons – aka the “mom-and-pops” – are the backbone of this industry. Lacking the multiple locations of their competitors, these salon owners are forced to do more with less when it comes to marketing and promotions. They’re also the ones who are most affected by factors that negatively affect the industry. As expected, this year’s peak season was down overall for the mom-and-pops, so if there’s any optimism to be found here, it could best be described as “cautious.”
“Sunscare mania” had a negative impact on business at BramaSolé Tanning in Prescott, AZ says owner Shelly Michelbrink. “We were recently attacked on our social media pages and on Yelp by a melanoma awareness group,” she explained. “Even though (the group’s members) never visited our salon, they gave us poor reviews and posted pictures of people who have died from or were dying of skin cancer.” This had a significant effect on numbers at Shelly’s 1,500 square-foot, 10-unit salon: she reports a 12 percent decrease in UV sessions sold this peak season and a seven percent decrease in gross sales. She also said her business served 25 percent fewer tanners in April, typically her busiest month.
Looking forward, Shelly plans for growth at BramaSolé but in the traditional sense. She explained, “In March, we introduced a state-of-the-art spray-tanning system that increased this part of our business by eight percent. We also added a women’s clothing boutique, and both of these additions helped bring our business up 6.3 percent during the first half of the year, despite our decrease in UV tanning.” Shelly plans to continue evolving in order to remain profitable in a marketplace she sees as changing.
“I was down 20 percent across the board.” That’s how Wade Ranard described this year’s peak season at Total Eclipse Tanning in Marion, IA. It was a chilling reminder, he says, of tanning’s seasonal nature. “We had a brutal winter!” he exclaimed. “While we didn’t get a lot of blizzards, it was still so cold out that people didn’t want to leave their houses unless they absolutely had to, so needless to say, indoor tanning wasn’t exactly the first thing on anyone’s mind.”
A proposed teen tanning ban in his state might have also contributed to his lackluster season, Wade said. Although the bill was eventually defeated, he says the near-constant talk about it on TV and the newspapers added to the negative feelings many already had about indoor tanning. “I’ve heard the bill is going to make a comeback,” Wade added, “which means I’m holding off on any expansion plans in the foreseeable future.”
So…
What do the experiences of the salon owners in this article tell us about the state of the industry as a whole? Quite a bit, actually. The most obvious observation is that regardless of salon size, the 2014 peak months were an overall downer. In fact, most salon owners’ numbers weren’t far off from the downturn reported by Vince Lorraine: four percent in tanners and seven percent in revenue. Beyond the numbers, we also see that the salon owners interviewed in this article are changing, modifying and evolving their business models in order to be successful in the future.
So what are you, the tanning salon owners of America, going to do about it?
We hope your answer is, “Change with the times.” And if this article is the “writing on the wall” that it should be, you’ll see that there will always be forces working against your business’s best interests. This means you’ll have to work twice or maybe three times harder – or smarter – to be successful, but it’s definitely worth the effort. The key is adjusting what you’ve been doing in order to keep up with changes in the marketplace. The too-big-to-fail mega salon chain concept can no longer be supported, nor can unchecked expansion, and it’s time to ditch any sales, marketing or managerial practices that aren’t working. The best way to keep current with all things indoor tanning is to read your ist Magazine and put the information presented inside into practice at your salon. It’s your business, but we think it’s worth saving, too!
ist Magazine would like to thank all of the tanning salon professionals who contributed to this article. ■
“We as salon owners aren’t doing what we should, and it’s hurting our industry. We need to step up our game by focusing on hiring quality people and training them properly as well as constant reinvesting into our businesses with new products and equipment. As long as we continue to do this, we’ll be prepared and confident about our services, products and equipment and our guests will continue to trust our brand.”
Brad Blair
Pacific Tanning (Selden, NY)
“On December 9, 2013, I took over operating the salon from my mother and the first thing I did was train the staff on how to sell. The second thing I did was replace our lower-priced tanning products with mid-level and high-end lotions. By offering clients free samples and selling them packettes, we were able to show the tanners that our product lineup actually works, making them willing to pay the price difference.”
David Givans
Island Tan (Crosby, TX)
“Lack of training is perhaps the biggest problem facing this industry. All of us have to do everything we can to present a more professional image of our business to the public; it’s the only way to counteract the media’s message about indoor tanning.”
Mark Furniss
Tropical Isle Tanning (W. Central, IL)
