Mr. JOHANNES KEVIN GO: Investing in Franchising, From Carton Boxes to Spa Business

Our first feature is about a young entrepreneur, who found success in franchising a spa brand known for its Thai body and Swedish massages.  Hopefully this will help those interested understand the spa business and its profitability through the owner’s experiences. Meet Mr. Johannes Kevin Go.

1. What was your first step in starting your business?

I know people who started business spontaneously - without business plan, market analysis etc. But we, my wife and a friend, didn’t want to run that risk as it could lead to failure – thus a waste of time and finances. I have my experience in selling carton boxes and Spa business has become more and more popular.

So after visiting a couple of Nuat Thai branches, we immediately inquired about franchising – checked the necessary investment, projection and performances of current franchisees.  It’s a good business.

After sealing the deal with the franchisor, we started rolling out the business.  Firstly, we’ve chosen a place with lower rate of competition. Everybody knows that this business expands and grows very fast. In a spa with good location, one may count over 50 spa visits per night. The first step was to find finances and place for it. I must admit that great advantage of this sphere is that any place would do. Most people are tired of constant fast-moving life. We are ready to provide relaxation for them.

2. How did you arrange financing?

Well, actually we already have some experience in economic affairs. I assigned my wife to regulate finances during the first 6 months until we fully understood the system. We invested heavily on construction. The interior design and equipment cost nearly Php 1.8 million. Our first expenses included personnel salary, rent, equipment amortization, cost value, etc. They were partly covered within a year. Later each procedure brought pure income.

3. Who is your target market?

Nowadays target market of spa business is rather wide. When starting a business it’s very important to understand marketing. One should know needs of target customers and try to fulfill them. Our spa is intended for busy people, tired of smog and contaminated city. Everybody needs relaxation. Our target market consists of people who care about relaxation after a whole days work. People struggle against stress and constant tiredness. Massage spas provide positive emotions and effective mood.

4. Did you do any primary or secondary research?

As I have mentioned, we didn’t have much experience in this sphere. But we were young, initiative and ambitious, and looked for any opportunity to start a business. Spa sphere was already developed. That’s why we used secondary research. We listened to what our franchisor told us. We likewise read online articles and followed the example of successful entrepreneurs that we know.

5. If you had it to do all over again, would you do anything differently? What mistakes did you make?

I must admit we surely made few mistakes, as nothing can be done perfectly. We had some problems during the first month of operations. Therapists leaving us.  Numerous customer complaints. I think we were lucky and if I had to do it all over again, I’d probably change almost nothing.

6. How large a part does creativity play in your business?

Creative work, innovations and initiative ideas are of great importance, especially for spa business. Nowadays more and more people get involved in this sphere. It creates high competition. That’s why it’s necessary to have unique approach not to be like others. New equipment and professional staff are always valuable.

7. What portion of gross sales do you spend on advertising?

We’ve been using wide range of advertisements which turn out to be not so expensive. We actually try to establish personal contacts with valuable clients. But generally advertising expenses are paid back very soon, because more and more people come to our spa. A successful entrepreneur never stops improving the advertising system, no matter how much it would cost.

8. What makes your business unique?

I think customers should decide what distinguishes our branches among other Nuat Thai spas. We help to improve people’s well being, get rid of tiredness and stress. What’s unique? Well, may be a combination of clean massage areas and consistent quality massages. We are maintaining a wide range of procedures catering to different client needs.  The music that we play are carefully chosen.  We see to it that our linens are kept clean at any given time and day.

9. How did you write your Business Plan?

Spa-enterprise needs special approach. There’s no stereotype in writing a plan for spa business. One should develop it individually. At first we thought of economic side (amount of investments, expenses and profits). It was important to plan target marketing and the necessity of maintaning a good relationship with our franshisor and suppliers. In addition, the business location, staff, strategies, and opportunities to promote ought to be taken into account.

10. Are gross profits all you expected them to be?

Before starting a business it’s always necessary to think over profitability. In order to define general income one should take into account profitability of each expansion in particular. Our spa is gradually expanding. We just opened three new branches in the last 10 months.  For every branch we are introducing more conveniences for clients. It naturally reflects in general gross profit. For a growing business our profits are quite satisfying, but we try to arrange work more efficiently.

11. Anything else you would like me to know about your company?

I think our company has wide perspectives for future and is beyond comparison. Having learnt so much about spa-business, I hope you’ve got interested in it, understood its structure, positive and negative sides.

About the entrepreneur:

Name: Johannes Kevin Go
Age: 34 years old

Name of business: Nuat Thai

No. of branches: 4

Nature of business: Spa

Industry: Service

Initial investment: 2M per branch

Payback period: 24 months (First branch)

For inquiries and reservations, please contact them at:

Nuat Thai Libis - (02) 4775004 / 09238190480
Nuat Thai Pioneer - (02) 5848139 / 09428086828
Nuat Thai Banawe - 09428286828
Nuat Thai Examiner - 09434904247