Competition forces 30 spas to fold up

As Cebu’s wellness industry nears the critical saturation point, around 30 spa outlets have opted to close shop over the last few months failing to sustain the grueling competition.

Spa and Wellness Association of Cebu (SWAC) reported that out of 200 spa outlets that opened in Cebu in the last few years, over 30 spa outlets were not able to make it as "survival of the fittest" syndrome hit the industry.

SWAC president Johnie Lim said that although this development is generally not appealing, it however provides good industry benefits, saying that "filtering the industry is healthy, because it takes out uninterested players."

"It means that only those who survive and have the passion for their work [businesses] are the ones really interested in the business," he said.

Lim admitted that the Cebu Spa industry is almost reaching the saturation point or it already has. Too many players have resulted to Spa's operating "lesser quality" and "diluted" services in order to lure more customers.

"It seems that they [those who not able to make it] are contributing less to the objectives of Cebu as a wellness destination," he stressed.

Together, with the Cebu Health and Wellness Council, SWAC has been actively promoting Cebu becoming a wellness hub in Southeast Asia by 2011.

Although, prospects for growth is still achievable, Lim said that the industry is not spared from the threat of the global financial crunch, which will led consumers to lessen their expenses on wellness, over daily commodities like food and transportation, among others.

"The spa industry requires passion. If one is there for profit alone, chances are he will not make it, especially when times are hard," he said.

Amid the spending slowdown outlook especially next year, Lim urged passionate players in the industry to find a niche, invest on promotions both domestic and foreign shores, and provide innovative and quality services.

However, those Spa outlets that are targeting the affluent and high-end market are expected to be the least affected by the financial crunch.

As early as now, he said the Spa industry has experienced an all-time-low performance. The month of October is supposedly the peak month for the wellness sector, but performance of most Spa outlets have turned slower compared to the other years.

"The month of October, which supposedly one of the peak months for Spas and salons [historically] saw a dip in the number of customers availing themselves of wellness services," he said.

Lim, who operates several Spa outlets nationwide through the Body and Sole brand, said that most operators are seeing 50 percent decline in their revenues.