Pre-opening Costs

Pre-opening costs in the development of a spa facility are of two types, hard costs and soft costs. Many times a lending institution will ask a spa developer to differentiate between hard and soft costs, and a different type of loan for each category may be arranged. With either type of expense, the key to managing your pre-opening costs is to set clear, specific, measurable goals and stick to them!

Hard costs
Hard costs usually include construction costs plus the prices of FF&E (furnishings, fixtures and equipment). The hard costs of a spa development are usually the big ticket items when it comes to the pre-opening expenses.

Soft Costs
Soft costs include labor and items such as architectural and design fees, professional services, start-up supplies, printed materials and marketing costs. Soft costs include all of the many various pre-opening expenses that could be incurred in the development of a spa facility prior to the actual opening and operation of the spa. These too, vary greatly depending on the size, caliber and inclination of the spa.

Because soft costs are less tangible than hard costs, they can easily get out of control in the pre-opening stage of spa development, unless they are well thought out and accounted for in advance. Many spa projects have gone over budget because the soft costs were simply not thought of prior to the operations of the spa.

One of the primary soft costs attributed to pre-opening is marketing expense. A you know by now, marketing a spa starts upon the inception of the concepts and must be carried though in all the years of operation.

Pre-opening Costs to Consider:

Beauty Salon
Body Treaments                                                           
Bookkeeping                                                           
Boutique/retail Cost of Sales                                            
Cleaning Supplies
Computer (IT, MIS)                                                  
Contingency                                                            
Contract Cleaning                                                    
Entertainment                                                           
Equipment Rental                                                              
Exterminating
Facials
Fitness                                                            
Flowers and Decorations                                           
Guest Clothing                                                         
Guest Refreshments                                                 
Guest Supplies/Toiletries                                          
In-Service Training                                                 
Insurance 
Laundry/Linen
Library                                                                      
Licenses and Permits
Locker Room/Facilities                                                   
Maintenance/Repair Supplies                                   
Marketing/Advertising                                         
Marketing/ Promotions                                           
Medical Exam                                                           
Miscellaneous                                                         
Office Expenses                                                       
Operating Costs                                                      
Payroll                                                                
Payroll Benefits                                                     
Pool Maintenance
Pre-opening Payroll                                                     
Printing and Stationary                                            
Professional                                                             
Real Estate/ Pers. Prop. Tax                                     
Staff Clothing                                                           
Telephone   
Training                                                           
Travel and Transportation                                      
Utilities
Wet area

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