This article was updated on July 26, 2023.
How to Start a Medical Spa in 7 Steps
From body sculpting to laser hair removal, medical spas offer clinical-grade procedures in a pampering environment. Today, medical spas are a multi-billion dollar industry, projected to grow considerably over the next decade. For those interested in this burgeoning industry, now is a great time to take your first steps toward opening a spa.
Not sure how to start a medical spa?
This guide will cover everything from financing to marketing and give you the need-to-know knowledge for starting your medical spa. It all starts with a plan, so read on to establish yourself in the med-spa industry and avoid the pitfalls of starting a business.
Step 1: Design your concept
Every business begins as an idea, and often it takes months and years of brainstorming before the time comes to start implementing your plan.
If you’re asking how to start your own med spa, begin by establishing the basics, such as:
- What services you will offer – What are you looking to offer your customers? Medical spas offer a range of spa services, and most pick a specialty. Medical weight loss, de-aging processes, chemical facial treatments—there’s a plethora to choose from, and you can choose several. Just be certain that you’re not over-expanding your medical spa business's capabilities.
- Describe the look and feel – Medical spas need to offer more than quality aesthetic treatments and medical procedures. They also need to create an inviting and inspiring environment to attract clientele. As Dr. Chikodiri Gibson, owner of New York-based Chi Aesthetics, says “I designed the office space so that it is as cozy as a home. I want my patients to feel comfortable, so we made the atmosphere as inviting as possible.”
- Business size – While every business has room to grow, where you start is ultimately up to you. Are you planning on opening a large business staffed with full-time RNs and aestheticians, or are you looking to open with a smaller staff? Your business size determines the space you need, as well as the number of customers you can take on at any given time.
Your business’s core ideas should be well-established before embarking on your journey as a med spa operator, but remember, you’ll also need to remain flexible. As you move forward, plans may change, and business models may pivot depending on what works best for you.
Step 2: Write your business plan and secure funding
With your concepts laid out, it's time to begin the heavy lifting. Writing a business plan for your medical spa is a major undertaking that requires market research, financial data, and plenty of number crunching. Additionally, a medical spa business plan is likely your path toward funding.
Investors, banks, and loan officers need extensive documentation to issue you the capital to start your business. Unless you’re starting your business with personal funds, you’ll need to prove that your business can be successful on paper before you can secure financing.
Your plan will need to address business aspects such as:
- Income
- Cashflow
- Expenses
- Operating costs
- Organizational structure
The aforementioned budgetary numbers are just a portion of your business plan. Ultimately, the plan will cover the full scope of your business, from the executive summary to your five-year plan. Fortunately, with a little expertise and diligence, you’ll be able to craft a winning business plan and secure funding.
Step 3: Sign up for insurance
The cost of business and medical insurance is a top priority in the medical spa industry. While it will likely come up during your business proposal budget, it’s worth emphasizing the requirements for medical spa insurance.
To operate legally and safely, you may need to obtain any of the following types of insurance:
- General liability insurance – A common type of insurance for most businesses, general liability insurance protects you and your business from lawsuits related to accidents and property damage.
- Professional liability insurance – Also known as malpractice insurance, this specialized service covers lawsuits due to the various services and procedures you perform. If someone claims to have suffered an injury while under your care, professional liability insurance can protect you.
- Workers’ compensation insurance – Used to cover lost wages or medical expenses for your employees in the case of a work-related accident. Many states require workers' compensation insurance for any business with multiple employees.
Step 4: Establish legal compliance
Medical spas offer medical services. Due to the specialized nature of the business, most states require medical spas to be owned by a licensed physician or physician-owned corporation. Fortunately, there are ways for non-doctors to own and operate medical spas while remaining fully compliant with the law.
For non-doctors, med spa ownership is possible through a management services organization (MSO). A MSO works to manage:
- Business operations
- Payroll
- Accounting
- Hiring
Essentially, an MSO controls all aspects of the business, except for the actual medical treatment. You’ll still need to hire a licensed physician (most often a dermatologist or plastic surgeon) to remain compliant, but the day-to-day will remain firmly in your control. For non-doctors, finding a trusted physician to partner up with is a crucial step in building your med spa business.
Step 5: Find your location
The ideal location for your business may depend on your clientele, budget, and plans for expanding. Some medical spas attract customers by setting up shop in busy downtown areas, while others might find success in more rural areas, complete with eye-catching scenery.
No matter where you’re thinking of locating, keep the following factors in mind:
- Zoning – You’ll need to find a location properly-zoned for commercial businesses. Otherwise, you may spend significant money and time negotiating zoning laws with the municipality.
- Parking and accessibility – Give your clients a convenient way to park, arrive, and enter your facility. Likewise, ensure the space is equipped with ramps and elevators. Accessibility is a must for medical spas.
- Competition – If you’re looking to establish your business in an area with several currently operating medical spas, you may want to reconsider. Direct competition in your neighborhood can make starting a new business all the more difficult. Then again, if you offer something that nearby medical spas don’t, you may be the perfect fit for the neighborhood.
Keep in mind, your first location may not be where you stay. After only one year of operation, Angela Johnson, owner of Skintuition Medical Aesthetics in Pocatello, Idaho, opted to move from a small office to a 1,400 square foot space. She was able to make this possible by taking into account all of the factors above and expand her business.
Step 6: Hire your staff
Doctors aren’t the only staff members you’ll need. Unless you’re planning to operate as a sole proprietor, you’ll need several employees to provide services and assist with daily operations.
The most common hires for medical spas are:
- Registered nurses
- Physicians assistants
- Licensed aestheticians
You may also consider hiring a receptionist, office administrator, accountant, and technical support to get your business up and running faster. Practice thoughtful and ethical hiring practices and conduct a thorough interview process to find the very best candidates.
Step 7: Refine your brand
Who are you as a business? A brand isn’t just how you display yourself through uniforms or your medical spa marketing materials. It’s the essence of your business that your customers come to recognize instantaneously.
Ideally, you’ll already have a clear picture of your business as a brand. Be sure to hone in on:
- Your logo
- Your target audience
- Your voice
From the interior of your spa to your website, work to create a singular brand identity that will make your business unforgettable.
Step 8: Develop your marketing materials
Before you can bring customers through the doors, you’ll need to entice them with a strong and strategic marketing plan.
Some spa-specialized marketing ideas include:
- Spa rewards – Encourage customers to return for your services frequently by offering a rewards program. The more they spend, the more points they can earn and put toward future medical spa services. It’s just one way of giving back to your most loyal customers.
- Build local relationships – Consider connecting with other local businesses to build your customer base. You may be able to collaborate with a local day spa and create inter-business discounts that bring more customers into both businesses. Additionally, explore your neighborhood digitally to make more local connections.
- Customer referral bonuses – Referrals are a simple way to expand your reach using the network you already have. Offer customers referral discounts for recommending your business to their friends and family. It’s a win-win for your business and your customer.
Invite your neighbors to the spa with Nextdoor
It may not be simple, but with some practical advice and a little bit of luck, you’ll be opening the doors of your new medical spa business in no time. Before you start planning your grand opening, check out Nextdoor to start building your presence in your neighborhood.
Claim your Business Page so neighbors can learn more about your med spa and recommend your services to their friends. It’s a simple way to be connected to your community and let the neighborhood know there’s a new medical spa in town. Claim your Nextdoor Business Page and get started today.
All kinds of businesses use Nextdoor to grow and reach their neighbors
Skin By Lexie is one of those businesses. When she started out in 2020 she had 50 clients - now she has 900.
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Sources:
Research and Markets. Medical Spa Market by Services - Global Opportunity Analysis and Industry Forecast, 2020 - 2030. https://www.researchandmarkets.com/reports/5215114/medical-spa-market-by-services-global
SI Live. Connecting beauty and wellness, NYC medical spa focuses on multi-cultural skincare. https://www.silive.com/business/2022/02/connecting-beauty-and-wellness-nyc-medical-spa-focuses-on-multi-cultural-skin-care.html
Insureon. Business Insurance for Medical Spas. https://www.insureon.com/personal-care-business-insurance/medical-spas
American Med Spa Association. Can Non-Doctors Own Medical Spas? https://www.americanmedspa.org/blogpost/1633466/284172/Can-Non-Doctors-Own-Medical-Spas
East Idaho Business Journal. A year into business, local couple opens larger location for successful medical spa. https://www.idahostatejournal.com/business_journal/east_idaho/a-year-into-business-local-couple-opens-larger-location-for-successful-medical-spa/article_3c9ab1f7-385e-5c7f-8178-aebed6508ffc.html
Times Union. Monarch Medical Esthetics Serves All People. https://timesuniononline.com/Content/Local-News/Business/Article/Monarch-Medical-Esthetics-Serves-All-People/2/244/135054
