My colleague Nicole and I were recently in Boston where we hosted two evenings of Hand & Stone Massage and Facial Spa franchising dinner seminars. While sitting in the airport waiting for our flight home, it occurred to us that people considering business ownership might be interested in learning more about the seminars we’ve held for prospective franchisees. As we were waiting to board and watching aircraft take to the skies, Nicole and I sat overlooking the runway for a Q&A about what to expect as a potential franchisee who attends a seminar.
While I’m VP of Hand & Stone’s Franchise Development, I’m also the owner of three Hand & Stone franchise spas. I’ve seen firsthand how Hand & Stone has helped more than 300 people get their spa businesses off the ground much like planes smoothly lifting off into flight. All franchisees get Hand & Stone’s proven business model that includes monthly recurring revenue along with assistance, training, and support each step of the way. No stone is left unturned on the path to becoming a spa owner.
Hand & Stone has held dinner seminars in five locations including Boca Raton, Indianapolis, Boston, Cleveland, and Seattle. We do two dinner seminar nights in each location, and attendees can RSVP for either evening depending on their schedules. The event is held at a high-end restaurant or steakhouse with a casual business presentation focused on everything a potential franchisee needs to know to decide if they are interested in pursuing ownership. It’s really an informational session aimed at educating potential spa franchise owners about the opportunity of becoming an owner with Hand & Stone.
Q: How do you decide where to hold the dinner seminars?
A: Hand & Stone has about 300 franchise units right now, and we’ve identified areas in the country where we’d like to grow and build additional units. Typically, we find an area with at least one spa location, and we offer the dinner seminar attendees free spa services there for a firsthand experience. It’s much more beneficial to potential franchisees to invite them into a location and see the spa’s quality service and beautiful decor in person.
Q: How many people attend each dinner seminar?
A: Each event can include from 6 to 50 people depending on the venue and attendance. We work with different franchise real estate brokers and financing partners throughout the country, and they are sometimes present at the dinners.
Q: What is the Hand & Stone dinner seminar agenda?
A: Attendees meet the franchise development team face-to-face and learn about our management team. It’s educational for the attendees. We walk them through the franchise process showing our support structure along with a presentation during dinner. The event begins at 6:30 p.m. and we do introductions before the presentation. Nicole and I open up for questions at the end over dessert. The evening usually ends at about 9 p.m. A potential franchise owner would go through the process like a regular prospect after attending a seminar if they are interested in the franchise opportunity.
Q: Do you explain how Hand & Stone supports its franchisees?
A: Absolutely. Hand & Stone franchisees get franchisor support for location selection, real estate, marketing, advertising, training and education, business, finance, field operations, and design and construction. Franchisees can rest easy knowing Hand & Stone has over 250 years of combined franchising experience on its management team.
Q: Do you address how franchisees pick a site for their spa?
A: Of course. Hand & Stone will help franchisees with real estate. We’re there every step of the way. The size of the average Hand & Stone location is about 2,000 to 3,500 square feet. Real estate is available and affordable in locations near banks, apparel retailers, restaurants, supermarkets, pharmacies, and shopping centers. We’ve had franchises recently secure leases in centers anchored by Target, Whole Foods, Starbucks, Kohl’s, Trader Joe’s, and Panera Bread.
Q: Do you touch on how franchisees may get help picking a spa location?
A: Yes. We work with Morrow Hill, a national real estate leasing representative, as well as other commercial real estate brokers, that helps franchise and corporate brands including Hand & Stone find locations and negotiate lease agreements. Here’s how the process works: An introductory call is held between Hand & Stone, Morrow Hill, and the franchisee. Then come the site selection phase, market tour, and multiple letters of intent. Next come the locally sourced contractor bids and layout design from our in-house designer. Lastly, a lease review and lease execution are completed.
Q: How do you discuss who handles advertising exposure?
A: We definitely talk about that in the seminar. Hand & Stone’s national spokesperson is Olympic gold medalist and FIFA Women’s World Cup champ Carli Lloyd. We also have a partnership with David’s Bridal. Franchisees get help from the HSM Advertising agency which creates, plans, and executes the marketing and branding strategy and advertising for Hand & Stone Massage and Facial Spa.
Q: Do you talk about how Hand & Stone is doing financially?
A: Hand & Stone saw $1,068,280 in average sales in 2015 for spas open 24 months or more. The spa’s memberships allow for a predictable and recurring cash flow while gift card, Groupon, and LivingSocial business is strong. Franchisees do not have to operate multiple spas to have financial returns. In April 2016, FRANdata named Hand & Stone as one of the top 10 most credit-worthy brands in franchising.
Q: Will I learn what my investment is as a franchisee?
A: Yes. The total investment for buying into a franchise ranges from $466,155 to $528,389 which is made up of several start up costs. I’ll break it down further. The startup costs cover the following: a franchise fee, real estate and utility deposits, leasehold improvements, furniture, fixtures, supplies, and equipment, computers, insurance, security system, initial inventory, travel expenses, signage, grand opening advertising, licensing drawings, legal and accounting, and working capital.
Q: Do you talk about financing options?
A: At key locations landlords may finance build-out. Equipment leasing is also available to defer startup costs. Franchisees can access 401K rollover programs that allow them to invest in their own company. Liquid investments can be in the form of cash, 401K, or home equity.
Q: What are the next steps after a franchising dinner seminar?
A: We always open the evening up to questions after the dinner presentation. After a seminar itself, a prospective franchisee can set up a meeting, book their very own spa treatments to experience Hand & Stone services in person, and speak with existing owners about franchise business opportunities. We also plan an optional Hand & Stone Discovery Day at our headquarters where seminar attendees can meet our corporate team and learn about the internal workings of a spa location if they choose.
Do you have questions about becoming a Hand & Stone franchise owner? Contact us for more information.