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Here's the Rub - Why NuSkin is ahead of the trend

|Includes: Nu Skin Enterprises Inc. (NUS)

In part this is the trend and the mindset that is driving the growth of NuSkin.  Bold emphasis mine

Here's the Rub
Expensive day spas are being pummeled by the recession, but franchised spas and massage centers are growing fast.

By Jason Daley   |   Entrepreneur Magazine - December 2010

Duck into any downtown day spa or destination resort and the Enya might seem to echo a little more loudly than usual. That's because, according to the International Spa Association, America's appetite for blueberry pore-refining facials, seaweed body wraps, reflexology and hot stone massages has been a casualty of the recession. After a decade of unprecedented growth, and a couple of stellar years--spa visits jumped by nearly 16 percent in 2008 alone--the industry was hit hard, losing 10 percent of its business in 2009 and 5 million square feet of real estate between mid 2009 and 2010. "We're the industry that's first to feel a recession and the last to recover," says Hannelore Leavy, chairwoman of the Day Spa Association advisory board. "Spa services are still a luxury and not absolutely necessary. People tend to hold back."  Or Do they?

A closer look shows that Americans haven't quite suppressed their penchant for pampering. While destination and upscale day spas have taken a brutal waxing, the relatively new franchised massage and day-spa sector has been busy keeping the nation rubbed down and exfoliated. Franchised spas, which include more than a dozen concepts, with more being launched each month, have refined their business model over the last few years and picked up a huge base of cost-conscious consumers. Most companies are reporting double-digit growth in sales, huge increases in new franchises and big upticks in repeat visits. Most of the franchise concepts have positioned themselves for exponential growth when credit markets finally loosen up.

It's tempting to think that these lower-cost services are doing well at the expense of pricier spas, but the truth is a little more complicated. Spa culture has seeped into mainstream America in the past 20 years. What was almost a taboo service, massage today is considered a routine part of sports and wellness. In fact, a September study sponsored by the National Institutes of Health found that even a single massage has positive biological effects, which include lower levels of stress hormones, boosts to the immune system and increases in a hormone associated with contentment. Meanwhile, beauty treatments, once the domain of elites, now are standard at day spas and midpriced resorts, which perform body wraps by the millions. The new spa franchises, Leavy notes, haven't cannibalized day and resort spas; they're acting as spa service evangelists. ----

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