MassageLuXe

Escape and relax

Business View Magazine interviews representatives from MassageLuXe, as part of our focus on best business practices of franchise companies.

Ease of stress, tension relief, improved immune system, and pain management are just a few of the many advantages gained with a continuous massage regimen. MassageLuXe, with franchise locations across the U.S., offers its members standard and specialty massages, facials, aromatherapy, foot scrubs, waxing, and more, within a luxurious environment for the best in relaxation and modern beauty treatments.

Recently, Business View Magazine spoke with Sean Rentchler, MassageLuXe’s Director of Franchise Development, and Chief Growth Officer, Kristen Pechacek to find out more about this thriving franchise and its plans for future growth and development. The following is an edited transcript of that conversation.

BVM: Can you talk about how MassageLuXe came into being?

Rentchler: “We were founded in 2007 here in St. Louis, Missouri. We started with a purpose: to encourage the health and wellbeing of our customers to improve their quality of life. Our spas are luxurious and immaculately maintained, and our people welcome and make you feel at ease the moment you walk into the door. We found a better way to offer massage and facial services with luxury at an affordable price.

“Our first location was in Rockhill, Missouri. Just like when you start any new business, there is a learning curve. We continued to learn within the industry and moved forward with brand growth by opening a second location in Kirkwood, Missouri. That location really took off and a lot of the experiences we gained through our initial location in Rockhill, Missouri served us really well. We continued to grow from there.”

BVM: What is the current extent of your franchise operation?

Rentchler: “Currently, we have 68 locations in 16 different states, plus Washington, D.C., and are continuing to grow at a steady pace. All of our locations are franchised, and the majority of our franchisees are multiple-unit operators. We do have some franchisees that own a single unit, and manage it themselves, but the majority of our franchisees own two or more locations. The average deal size for new franchisees coming into the system is one-and-a-half locations per contract. Moving forward, we don’t expect that to change.”

BVM: What do you look for in a potential new franchisee?

Rentchler: “We don’t require our franchise owners to have experience in the massage industry. As a matter of fact, all of our franchisees have vastly different backgrounds. The majority have a high level of business acumen or executive level experience. Others have prior business ownership experience in a variety of different fields. For example, we have franchisees that are doctors; another owns his own office supply company; a few are in finance; and one even owns their own massage therapy school.”

“What I really look for when talking to candidates is passion about what it is we’re doing and what we’re trying to achieve. We believe that people benefit from massage and the other services that we provide in our spas. And we’re focused on trying to increase access for those services and do so in a way that’s reliable and ethical for our communities. We tier our membership services so that most people can come in and find something that meets their individual needs and is a benefit to them.”

“If someone is not passionate about what it is we’re doing, or I don’t get the sense that they’re really involved in their community and believe that it would benefit from doing business with us, that’s the biggest turn-off for me. Everything else can be taught; we can teach them how to run a spa, and what they need to focus on.”

BVM: Once you’ve awarded a franchise, what sort of support do you offer your new franchisee?

Rentchler: “Once they sign that franchise agreement we immediately dive into site selection. We formed a relationship with a company called Locate AI; they provide us with our mapping platform as well as the demographic and psychographic information used to analyze real estate opportunities within a franchise owner’s market. We work with them to analyze key real estate data points to help guide franchise owners to specific areas within a market that we feel are best suited for MassageLuXe expansion, based on historical performance, and the franchise owner’s specific development goals.

“They also provide commercial services to our franchisees and assist with negotiating the LOI and the lease to ensure that our franchisees are receiving proper guidance and care during the lease negotiation process. Some commercial brokers tend to steer tenants towards properties they represent regardless of concept fit. Even if the broker does not represent a property, there is not a lot of motivation within the industry to negotiate lower rates due to commission structures. As such, Locate AI is there to help ensure our franchise owners are being protected. Locate AI has a network of brokers that have agreed to survey markets on their behalf, and Locate AI handles the rest of the process. The best part is there is no fee to our franchisees for this service. So, we’re able to provide additional support to our franchise owners without adding additional costs, which is fantastic.

“Once we identify sites within a market that we really like, I’ll tour the sites with our franchisee and we’ll review our in-person walkthroughs, as well as analytical data for the sites to determine which site makes the most sense to move forward with and submit an LOI on. Once that process takes place, and we get them to the point of signing a lease, we have a preferred architect that can work in any state, that we recommend our franchisees use, although they’re not obligated to do so. Our architect/vendor has contributed to a lot of our locations. Because of this, they have a level of knowledge and efficiency in understanding what spaces our particular model can fit into, while not wasting our time with locations that won’t work for our model. This same vendor will also provide a lot of the construction support. I’ll assist franchisees from a corporate aspect to complete the build-out of their spa, but our preferred vendor will actually do the site visits, provide any answers to questions that the general contractor has, and perform a complete punch list at the end of the project to ensure the location is built out to our specifications. Our preferred architect vendor is really detail oriented, which is why we love them. If anything with the build-out is even slightly off, they will not sign off on the punch list needed to close out construction on the location. This helps ensure we maintain the high standards we have for both our system and individual franchise owners. Once that’s completed, operations and marketing take over.”

Pechacek: “Our marketing support is turn-key; we handle everything from national marketing support all the way down to local marketing support with an in-house staff that places media dollars for you. So, we are working with the franchisee to find a media and marketing plan that works for that individual location and market. Not only do we deliver that plan, we also assist in its execution. Our support is amazing and unparalleled. Because of our size, we have enough scale where we know the operations needed in order to make a spa successful, but you still get that one-on-one support from a franchise rep who can bring you to profitability in an $18 billion industry that’s booming. We can make a person with one franchise extremely profitable, and we’re also a very attractive option for people who are looking to own multiple locations.”

BVM: Are franchisees required to work with your preferred vendors?

Rentchler: “We have vendor relationships set up for our franchisees to utilize specific products to provide the services within our spas. A lot of it comes down to buying power; you can get high-quality products at a lower rate as a system than what franchisees would be able to get on their own. It also keeps the processes and products uniform across our system since our memberships are valid at any location. Florida is a great example – we have a lot of members that are based within this state for the majority of the year. But then, in the summer, they go back north where they’re from, and they can utilize their membership there. So, we try to keep our products pretty uniform across the board – from massage oil to the products that are used in aesthetics. It’s key that they use the high-quality products that our clients expect, and we have a retail line, as well, that complements whatever service their client received that day.”

BVM: Do your massage therapists require special licenses?

Rentchler: “All Massage Therapists in our spas must abide by state and local laws and be licensed according to their state requirements.”

BVM: How do your franchises keep their supply of licensed therapists up to speed?

Rentchler: “The key thing is creating strong relationships with massage therapy schools in the markets that we’re involved in, so as new students are matriculating through the program and graduating, we are a preferred employer with a lot of the instructors at the school. Being a preferred employer will mean instructors at those schools will help direct graduates to our franchise owners. The other aspect is just shopping the market and understanding what massage therapists are getting paid and what benefits are being provided to them, based on the market you’re developing in, and making sure that we’re meeting or exceeding that within our locations.

“The goal of any new spa is to mix the new therapists coming out of school with experienced therapists that can help coach some of the newer people coming in and, if you can do that, you’ll have a really strong mix of knowledge and hunger to grow the business. Any time someone hires a therapist, we do full background checks. We call on references; we ensure that they’ve passed that national board; and we make sure that their licenses are still active. So, there’s a lot of background research, in addition to just recruiting to make sure we’re getting the proper people providing services within our spas.

BVM: Anything on the front burner that you are focusing on?

Rentchler: “We’re doing a slight refresher of the brand as far as color schemes to make sure we’re staying relevant to new retail and service space trends. But our focus has always been internal – ensuring that we continue to focus on the things that we do well and we’re able to scale them as we continue to grow.”

BVM: What does that growth look like?

Rentchler: “We set a goal for ourselves to hit 250 units within the next five years. It’s going to come down to making sure we’re focusing on the things that we do well and, as we continue to grow, we’ll put in the support and processes necessary to continue to operate the way we have been. There are markets that we really want to get into outside of the United States, at some point, but our intention remains to grow domestically. That doesn’t mean that we would turn down the right opportunity to expand internationally. I’ve had conversations about expansion into Canada, because it makes a lot of sense for our particular model with their healthcare system and the fact that it covers massage therapies. So, there’s a huge benefit there. But as far as actively targeting an international market, I don’t think we’re quite there yet.”

Pechacek: “I echo what Sean said. We’re open to development internationally; however we would love to focus most of our efforts right now, domestically. So many franchisors find themselves in a situation where they have something special in regard to product or service offerings and they sell it right away. In turn, they end up in a scenario where they have ten locations open and 80 sold. They find out quickly that it is easier said than done when it comes to scalable operating. MassageLuXe is uniquely positioned in regard to the amount that we have open and the amount that we have sold based on how long we’ve been around. We now know, and have proven, that we have strong unit-level operations and strong unit-level performance. We are at the point where we’ve proven our scalability and we are ready to open up the floodgates and grow the franchise.”

BVM: How has the COVID-19 pandemic impacted your business?

Rentchler: “It would be shortsighted to say that the pandemic didn’t affect every business on some level, but for the most part, we’ve been pretty pandemic-resistant across the board. The majority of our locations did an amazing job communicating with our membership base – giving them options on how to maintain their status: freezing their memberships, reducing the payment of fees, etc. And the process is in place to effectively and safely to sell services when our clientele enter our spas.”

BVM: What would you like a potential franchisee to know about MassageLuXe?

Pechacek: “MassageLuXe is different. We recognized a gap in the market, and we built something to fill it. Our spas speak for themselves. At MassageLuXe, you are not just a number. We go above and beyond to make sure that our customers maintain a healthy lifestyle in a welcoming environment, which keeps our locations busy. We have built a system where our spas are successful. Successful spas sell more spas; people want in at the performance that we have at the unit level. Our franchisee support in marketing and operations is unmatched. That paired with our eye for innovation and our state-of-the-art operating software positions our spas for a quick ramp and continued profits.”

Rentchler: “What I feel is most important is that we’re a healthy organization that provides a really good opportunity within the franchise industry. I’ve been involved with several other brands in my career, and our support here is second to none. We’re much more involved on an individual level with all of our franchisees than a lot of other brands are, with the added benefit of our marketing programs that are set up to help people initiate programs on a local level. So, there’s a higher level of support and caring that you’re going to find anywhere else in the franchise industry.

“Also, if you’re looking for a business that is relatively resistant to economical trends, whether it be a recession or the pandemic that we’re going through, this is a great option. The majority of our clientele is going to be higher income and not hit as hard with some of those economic changes as other people’s businesses are and for the most part, we’ve been pretty steady across the board – strong enough where we’re still actively looking to grow and seeing great results within our spas.”

AT A GLANCE

MassageLuXe

WHAT: A luxury massage franchise company

WHERE: Fenton, Missouri

WEBSITE: www.massageluxe.com