III. Industry Analysis
[Company Name] competes against other wellness centers, spas, fitness studios, and practitioners such as Naturopaths, psychotherapists, massage therapists, and chiropractors.
According to a report by Global Wellness Institute, the wellness vertical is a fragmented one, as the majority of operators are single-location businesses. The global market is estimated to grow to over $6 trillion in three years. Since there are no truly dominant competitors, barriers to entry are not as high as many other industries, and a start-up can expect to have success in this growing market, [Company Name] is well-positioned for success. There is plenty of room in the industry particularly for conveniently located wellness centers that cater to specific geographic and demographic customer niches. Smaller wellness centers can easily develop a loyal clientele that enable them to compete and succeed against other centers; in this industry, size does not necessarily mean an advantage, which bodes well for [Company Name].
The market in which [Company Name] will compete is experiencing a number of different trends.
- Strong growth. This market is expected to grow consistently at around 103% annually.
- Success drivers. Customer satisfaction is what ultimately makes one wellness center triumph while another fails. The experience a wellness center client has will ultimately determine whether or not they return and whether or not they refer others to the center.
- Economies of scale. Larger wellness centers are finding opportunities to succeed, by making effective use of support personnel. Receptionists and assistants at larger establishments can take care of many of the more menial tasks that skilled therapists and practitioners are responsible for handling in small establishments. This permits specialist staff to spend a higher proportion of their time actually performing skilled services.
- Independent spas. Independent spas also compete with wellness centers, offering some of the same treatments. These spas develop a loyal customer base and select their location on the basis of population demographics.
- Intense customer loyalty. Many wellness centers develop repeat customers who become a regular client base and represent a significant portion of their revenues. Wellness centers whose employees are able to develop strong relationships with customers can expect to see more long-term success.
- Gender preferences. Women are the most lucrative customers for wellness centers, visiting more often and purchasing more special treatments.