How to Open a Wellness Center

Wellness center is a broad term that can refer to a center that offers professional mental and physical health services, or a center that offers various types of relaxation and fitness services. This article will revolve around the latter – a center that offers services like massage, yoga, meditation rooms, or even acupuncture and IV hydration. 

If you’re interested in providing these valuable services in your community, you could start your own wellness center and get into a $23 billion industry. 

But first, you need to understand the business. Fortunately, this step-by-step guide details all the information you need to start a successful wellness center.

Step 1: Decide if the Business Is Right for You

Pros and cons

Wellness center industry trends

Industry size and growth

• Industry size and past growth – The U.S. health and wellness spas industry is worth $23.2 billion in 2023 after growing 1.1% annually for the last five years.((https://www.ibisworld.com/united-states/market-research-reports/health-wellness-spas-industry/))
• Growth forecast – The U.S. health and wellness spas industry is projected to grow 1% in 2023.
• Number of businesses –  In 2023, 22,398 health and wellness spas businesses are operating in the U.S.
• Number of people employed – In 2023, the U.S. health and wellness spas industry employs 372,181 people. 

Trends and challenges

Trends

• Wellness centers are offering more personalized customer experiences, tailoring services to meet individual needs.
• IV hydration therapy is increasingly being offered in wellness centers.

Challenges

• Wellness centers are increasingly facing staffing shortages.
• As wellness centers become more popular, the industry is becoming more competitive. 

Demand hotspots

• Most popular states – The most popular states for wellness specialists are Alaska, West Virginia, and Georgia.((https://www.zippia.com/wellness-specialist-jobs/best-states/))
• Least popular states – The least popular states for wellness specialists are Missouri, Minnesota, and Nebraska. 

What kind of people work in wellness centers?

• Gender – 66% of wellness specialist are female, while 34% are male.((https://www.zippia.com/wellness-specialist-jobs/demographics/))
• Average level of education – The average wellness specialist has a bachelor’s degree.
• Average age – The average wellness specialist in the US is 47.2 years old.

How much does it cost to start a wellness center business?

Startup costs for a wellness center range from $60,000 to $200,000, but could be substantially more depending on the extent of the services you plan to offer. Costs include the space rental and preparation, equipment to deliver services, and a labor and operating budget.

You’ll need a handful of items to successfully launch your wellness business, including: 

• Furnishings 
• Equipment to deliver various services such as massage tables 

Start-up Costs	Ballpark Range	Average
Setting up a business name and corporation	$100 - $500	$300
Business licenses and permits	$100 - $300	$200
Insurance	$100-$500	$300
Website	$500 - $1,000	$750
Space rental and preparation	$20,000 - $50,000	$35,000
Equipment for services like massage	$10,000 - $30,000	$20,000
Labor and operating budget	$30,000 - $50,000	$40,000
Sales and marketing budget	$500 - $1,000	$750
Total	$61,300 - $133,300	$97,300

How much can you earn from a wellness center business?

The prices you charge will vary by service. These calculations will assume that the average client will spend $100 each time they come in. Your profit margin after all costs should be about 20%. 

In your first year or two, you might have 10 customers a day six days a week, bringing in $312,000 in revenue. This would mean $62,400 in profit, assuming that 20% margin. 

As you gain traction, you might have 40 customers a day. With annual revenue of $1,248,000, you’d make a tidy profit of $249,600.

What barriers to entry are there?

There are a few barriers to entry for a wellness center. Your biggest challenges will be:

• Funding the startup costs
• Finding staff licensed to perform various services

Step 2: Hone Your Idea

Now that you know what’s involved in starting a wellness center, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research could give you the upper hand even if you’ve got the perfect product. Conducting robust market research is crucial, as it will help you better understand your customers, your competitors, and the broader business landscape.

Analyze your competitors 

Research wellness centers in your area to examine their services, price points, and customer reviews.

• Make a list of wellness centers that offer similar services. 
• Review your competitors’ services – their features, pricing, and quality – and marketing strategies.
• Check out their online reviews and ratings on Google, Yelp, and Facebook to get an idea of what their customers like and dislike.
• Identify your competitors’ strengths and weaknesses. 

This should identify areas where you can strengthen your business and gain a competitive edge to make better business decisions.

Why? Identify an opportunity

You’re looking for a market gap to fill. For instance, maybe the local market is missing a wellness center that offers holistic health services or that offers full wellness programs. 

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Establishing a wellness center for holistic health and relaxation

The list of services you can offer in a wellness center is long, and could include:

• Fitness classes including yoga
• Massage therapy
• Mental health services
• Wellness education
• Personal training
• IV hydration therapy
• Facials and other skin care
• Saunas
• Meditation classes
• Nutrition counselling
• Accupuncture

How much should you charge for wellness center services?

Your prices for services should depend on market prices in your area, but also  on your ongoing costs.

Once you know your costs, use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

Wellness centers primarily attract health-conscious individuals, professionals in high-stress roles, and those seeking alternative or holistic therapies.

The aging population and athletes often visit for treatments aiding in age-related issues or physical recovery.

Location plays a role too; centers in tourist areas may cater to vacationers, while urban centers might target local residents and corporate clients.

Where? Choose a wellnes center location

When selecting a wellness center location, begin with a demographic analysis to understand and cater to the target clientele’s needs. Ensure the chosen site is both visible and easily accessible, either by public transport or with adequate parking.

Always stay within your budget for rent or purchase, but factor in additional costs such as utilities and renovations. Confirm that local zoning laws permit the operation of a wellness center, and aim for a location that offers safety, serenity, and proximity to complementary businesses.

Step 3: Brainstorm a Wellness Center Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “wellness” or “wellness center”, boosts SEO
• Name should allow for expansion, for ex: “Vital Verse” or “Life Horizon” over “Aqua Serenity” or “Mindful Mats”
• Avoid location-based names that might hinder future expansion
• Use online tools like the Step by Step Business Name Generator. Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead and reserve your business name with your state, start the trademark registration process, and complete your domain registration and social media account creation. 

Your business name is one of the key differentiators that sets your business apart. Once you pick a name, reserve it and start with the branding, it’s hard to switch to a new name. So be sure to carefully consider your choice before moving forward. 

Step 4: Create a Wellnes Center Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

• Executive Summary: Summarize the core aspects of your wellness center, highlighting its purpose, location, and unique approach to promoting health and well-being.
• Business Overview: Provide a brief overview of your wellness center, explaining its mission, the types of services it offers (e.g., yoga, spa treatments, counseling), and its target clientele.
• Product and Services: Detail the range of wellness services available, specifying types of treatments, classes, or therapies offered, and any special features like experienced practitioners or holistic approaches.
• Market Analysis: Analyze the local and regional wellness market, including trends in health and wellness, customer preferences, and potential demand for your services.
• Competitive Analysis: Identify competitors in the wellness industry in your area, highlighting their strengths and weaknesses and explaining how your center distinguishes itself, whether through unique services, pricing, or exceptional customer care.
• Sales and Marketing: Outline your strategies for attracting clients, encompassing online marketing, partnerships with health professionals, and strategies for building a loyal customer base.
• Management Team: Introduce key members of your team responsible for managing the wellness center, emphasizing their qualifications and expertise in wellness, therapy, or related fields.
• Operations Plan: Describe day-to-day operations of the wellness center, including scheduling of appointments, facility maintenance, safety protocols, and customer communications.
• Financial Plan: Present financial projections, including startup costs, revenue forecasts, operating expenses, and profit margins for your wellness center business.
• Appendix: Include supporting documents such as certifications, testimonials from satisfied clients, photos of your wellness center, or any partnerships with healthcare providers.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you are planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to wellness centers. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your wellness center will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts. Here’s how to form an LLC.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation. Read how to start a corporation here.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC, which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have. 

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
• Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best option, other than friends and family, for funding a wellness center business. You might also try crowdfunding if you have an innovative concept.  

Step 8: Apply for Wellness Center Licenses and Permits

Starting a wellness center business requires obtaining a number of licenses and permits from local, state, and federal governments.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your wellness center business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property: Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation: Provides compensation to employees injured on the job.
• Property: Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto: Protection for your company-owned vehicle.
• Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.  

You may want to use industry-specific software, such as mindbody, or Appointy, to manage your appointments, marketing, employees, and payments. 

Accounting

• Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero. 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial.

Create a website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism. You can create your own website using services like WordPress, Wix, or Squarespace. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

Your customers are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. SEO will help your website appear closer to the top in relevant search results, a crucial element for increasing sales. 

Make sure that you optimize calls to action on your website. Experiment with text, color, size, and position of calls to action such as “Book Now”. This can sharply increase purchases.

Marketing

Here are some powerful marketing strategies for your future business:

1. Strategic Partnerships: Collaborate with local gyms, health food stores, or yoga studios for cross-promotions, enhancing your reach within the wellness community.
2. Community Workshops: Offer free or low-cost wellness workshops on topics like stress management, nutrition, or mindfulness to showcase your expertise and engage potential clients.
3. Referral Programs: Implement referral incentives for existing clients who bring in new customers, creating a word-of-mouth marketing engine.
4. Seasonal Promotions: Design seasonal packages or promotions tied to health and wellness goals, aligning your services with the natural ebb and flow of clients’ interests.
5. Social Media Challenges: Leverage social media by organizing wellness challenges, encouraging followers to participate and share their experiences, fostering a sense of community around your center.
6. Testimonials and Case Studies: Share success stories from your clients to build trust and demonstrate the tangible benefits of your wellness programs.
7. Corporate Wellness Programs: Target local businesses by offering corporate wellness programs, promoting employee well-being and creating a potential stream of regular clients.
8. Local Event Presence: Attend or sponsor health-related events in your community to increase brand visibility and directly engage with your target audience.
9. Loyalty Programs: Implement loyalty programs, rewarding clients for repeated visits or consistent engagement with your wellness services.
10. Innovative Classes/Services: Differentiate your center by introducing unique wellness classes or services that set you apart from competitors and cater to diverse interests within your target market.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your wellness center meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your wellness business could be:

• Discover holistic rejuvenation at our wellness center, where mind, body, and soul find perfect harmony
• Unlock your full potential with our personalized wellness programs, tailored to nurture your unique journey
• Experience transformative wellness at its finest with our integrated approach to mind, body, and spirit

Networking

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a wellness center business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in wellness centers for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in wellness centers. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

Potential positions for a wellness center business include:

• Massage therapists and other service providers
• Receptionist to greet clients and take appointment calls
• Marketing Lead – create and implement marketing strategies
• General Manager – staff management, accounting

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Wellnes Center – Start Making Money!

Starting a wellness center can be a very rewarding pursuit, as you help people with their overall well-being. It can also be very profitable in a $23 billion industry. You could even grow your business over time by expanding your space or adding new locations.

Now that you understand the business, you’re ready to get your successful wellness center up and running!