Strategies:Basking In Success

Despite health warnings, consumers are taking a shine to tanning salons

As the dog of summer come to a close, the $7 billion indoor tanning industry is preparing to bask in its busiest months.

The combination of sunless tanning technology, education and vanity has created a formula for success that just keeps growing, according to local tanning businesses.

And some salons are on the cutting edge - with $50,000 beds that resembles sports cars and amenities ranging from customer controlled air-conditioning to aroma therapy.

"We've gone from one market in less than two years ago to 16 markets today, with more than 100 locations nationally," said Wayne Smeal, founder and CEO of the Lakewood based franchise Executive Tans. "The industry has gone from the less than a billion to more than $7 billion today. Nothing has experienced growth like that except for the Internet."

The company now expects $22 million to $25 million in gross revenue next year.
 

But the glow of the industry is not just reserved for established franchises - one locally owned startup, Palms Tanning Resort, has sold 15,000 tans since February and owner Keith Rodenberger projects this year's revenues at $250,000.

"This thing wants to explode," Rodenberger said. "Even Microsoft didn't have these kind of returns in the first year."

The company is the official tanning salon of the Denver Broncos' cheerleaders. The sunless tanning, which provides immediate results and does not cause wrinkles, has proven very popular with the women, said Teresa Schroeder, director of the cheerleaders and game-day entertainment for the Broncos.

"The girls can go in a day before a photo shoot and look like they spent a week in Mexico," she said.

The Mystic tanning booth, which sprays a mixture of aloe vera, sugar and bronzing lotion, costs $35,000. Rodenberger's unit has paid itself off in two months with the sale of more than 2,000 sessions at $25 each.

And the two salons couldn't be more different. White Palms plays into beach theme, Executive Tans has made a point of avoiding it.

"Virtually every tanning salon, whether it's a mom-and-pop or a franchise, plays on the beachy , tropical feel," Smeal said. "We took a different road by establishing Executive Tans as a sophisticated refuge for busy, tan-starved professionals, or anybody that wants to feel like they are professionals."

And although Palms has brought into the tropical decor, it has taken the theme way beyond painting a few palm trees on the wall.

In fact, Palms Tanning Resort spent more money on its concept than any other salon in Colorado with construction taking six months compared with the normal one month, according to Rodenberger.

With help of Rinehart Arley Associates and New Castle Construction, Palms transformed a strip mall office space into a resort - complete with hand-tied bamboo, stone flooring with imported beach sand and a 12-foot theater wall that projects a moving ocean scene.

"There are 122 salons in the Denver area, and we don't want to be No. 123: we want to be the first of something different," Rodenberger said. "We have definitely shaken the tanning industry with our concept."

But Executive Tans has not been shaken, with 44 stores in the metro area and no franchise failures.

"This is a pretty vain business and most people are pretty vain," Smeal said. "Executive Tans is definitely a status symbol - we will never be the cheapest, but we will always be the best."

Tanning prices range from $5 to $25 for 20-minute sessions at the Palms and $10 to $30 for 20-minutes at Executive Tans.

One reason for the boom in the industry is a change in marketing across the board, according to Joe Levy, vice president of the International Smart Tan Network, an organization that provides certification, education and training.

"A tan is your body's natural protection from the sun," Levy said. "Cancer risk is associated with the sunburn and we are in the business of helping people avoid sunburns."

It is this king of openness about the effects of ultraviolet rays that has allowed the tanning industry to combat fears about indoor tanning.

But according to the Colorado Department of Health, which recommends people put on sunscreen every time they leave the house, no tanning is the best option.

"There is no such thing as safe tanning," said Sare Miller, director of the comprehensive cancer program with CDOH. "No matter how you receive the radiation, it can lead to the same deadly consequences."

Despite the safety concerns, the industry has never been hotter. Jerry Shilling owns two Dencer franchises, one being a new Elite store located in the Lowry Town Center that house high-end beds only. "We are getting more and more customers everyday."

Shilling, who previously owned an auto dealership in Europe bought into the Executive Tans franchise because the deal seemed easy and he was impressed with the stores.

Executive Tans charge franchisees a flat monthly rate of $795 instead of a fluctuating fee based on sales. "It is not good business to penalize franchises when they do better," Smeal said.

And although Rodenberger opened Palms Tanning Resort with the intention of earning enough money to retire and spend more time with his family, the idea has attracted so many investors that he expects to expand and maybe even start franchising.

"Tanning used to be a big X in everybody's mind," said Smeal.

But now indoor tanning has become a break from the daily grind with cosmetic results.

"We want to do more than just tan people," Rodenberger said. "We want to transport them out of Denver - it's like a small vacation."

Click Here For More Information On The Executive Tans Indoor Tanning Opportunity

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