After spending almost two decades establishing a strong foothold at home, Princess Beauty & Spa Co a Thai beauty and spa treatment firm, is moving abroad by forming a joint venture with The Westin Dhaka Hotel to provide the service in Bangladesh next month.

   
President Kanokporn Khemataechit said Princess Princess Beauty & Spa Spa BD Limited was recently set up with 10 million baht in registered capital. Princess holds 60% in the joint-venture firm and the balance by The Westin Dhaka hotel.

The 800-square-metre Westin Spa by Princess, built at a cost of 20 million baht and hiring 12 to 15 staff, would be opened next month on the fourth floor of The Westin Dhaka hotel, catering to local customers and foreign investors. Princess expects sales of 36 million baht per year from its first overseas outlet.

”Though Bangladesh is small, the market there has huge potential because a lot of foreign investors including Indians, Germans, Australians and Chinese. All of them have high purchasing power,” she said.

Mrs Kanokporn added that the joint venture would help Princess expand through the hotel chain’s global network.

To accelerate growth both at home and overseas, Princess plans to adopt a franchise system. ”We will stop expanding on our own from now on. Instead, we’ll shift to expanding through a franchise system because it will help speed up the process,” she said.

For overseas markets, the company would begin selling franchises first to investors in Johannesburg next month, charging a four-million-baht fee for a 10-year contract.

Locally, it would start franchising the business in December. Although there are over 100 applicants on the waiting list, Princess will move slowly by opening 10 franchised spas next year and 20 in the second year. It targets to have a total of 80 franchised spas in five years.

The franchise fee for Princess Beauty Clinic is 1.5 million baht while that of Princess Beauty & Spa is one million baht, both for a 15-year contract. On top of the initial investment cost and the fee, the investors would pay a monthly royalty of 5% of sales for both formats. Based on these costs, they are expected to break even within two years.

Currently,Princess Beauty & Spa Co Spa operates in four locations: Town in Town, Lat Phrao, Siam Square, Sukhumvit and Central Rama II shopping centre. The company achieves sales of 70-80 million baht every year, projected to increase by 20% after expanding through the franchise network.

Source: Bangkok Post

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