By Michael Meyer, Content Writer/Editor, American Med Spa Association
This week, the American Med Spa Association (AmSpa) conducted the COVID-19 Medical Spa Financial Status Survey, a brief survey of medical spa owners to help determine the financial impact of COVID-19 on the medical aesthetic industry. The results can be viewed here; they paint a picture of an industry that’s facing a great deal of uncertainty as a result of this public health crisis.
According to the survey results, the overwhelming majority of medical spas (93%) are currently closed; of those, roughly half closed of their own accord and half were forced to close due to shelter-in-place orders. Unfortunately, of those surveyed, over half (52%) are unsure if they are going to be able to reopen without financial assistance after the crisis subsides; 29% expect they will be able to reopen under these conditions, but 18% believe their business may never reopen.
The survey also reveals that at this point, a little over two weeks into the crisis, many medical spas have had to take drastic financial measures in order to adjust to the lack of revenue coming into their businesses. Fifty-nine percent say they have had to lay off team members; of these, 38% have only laid off one or two team members, but 25% have laid off more than nine, 18% have laid off three to four, and 16% have laid off five to six. Only 19% of respondents are paying these employees while they are laid off, but of them, half are paying more than 50% of their salary.
Only 52% of respondents say that they have reduced their employees’ salaries, but those who have cut salaries have had to make those cuts deep—79% say they have reduced their employees’ salaries by more than half.
Some medical spas are managing to generate some revenue via online sales, but few are finding much success doing so. Here is a selection of responses to the survey question, “Are you generating any online revenue?”
- “Trying to by selling virtual consultations and product, but not realizing any income yet.”
- “We are doing minimal. We have been so busy taking care of business. We have come up with daily specials, facials in a box, spa day at home, and presale specials.”
- “Trying to launch telehealth stuff. So far I’ve made $100.”
- “Instagram flash sales for prepaid services.”
- “Presale of packages and Zoom meditation and mindfulness classes.”
- “Small income from memberships, online product sales and virtual consultations. This is miniscule, however.”
However, the most commonly given answer was, “No.” Of course, this crisis has caused most Americans to face economic uncertainty, so it stands to reason that they may not be willing to spend their money on skin care products at the moment.
The passage of the Coronavirus Aid, Relief and Economic Security (CARES) Act has hopefully arrived in time for medical spas to benefit. According to the survey, 77% of respondents are investigating loans and grants in order to keep their businesses afloat, and perhaps this new influx of cash will help them along the way until the crisis abates.
Unfortunately, nobody knows when that will be, and the responses to this survey reflect that. Many of the respondents have already had to make excruciating decisions, and while the increased availability of grants and loans may alter the equation somewhat, more tough decisions will almost certainly need to be made.
And if there’s anything else you can take from the results of this survey, it’s this: You’re not alone. Everyone in medical aesthetics is dealing with this crisis, so reach out and talk to your fellow owners, operators and providers to learn what they’re learning about their situations. Do what you can to be a positive force in the community during this time, because we’re all in this together.