Franchise QB

Episode 64: Shane Evans- Co-Founder and CEO- Heights Wellness Retreat

• Mike Halpern • Season 1 • Episode 64

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In this episode of the Franchise QB Podcast, host Mike Halpern speaks with Shane Evans, co-founder and CEO of Heights Wellness Retreat. They discuss Shane's extensive experience in franchising, the evolution of Massage Heights into Heights Wellness Retreat, and the innovative services being offered. 

The conversation highlights the growing wellness market, the company's vision for the future, core values, and what makes Heights Wellness Retreat unique in the industry. Shane also shares insights on the ideal franchise owner profile, investment costs, and the importance of relationships in franchising.

Takeaways

-Franchising empowers entrepreneurs to achieve wealth and independence
-Heights Wellness Retreat combines traditional and touchless therapies
-The wellness economy is rapidly growing, presenting significant opportunities
-Membership models provide predictable revenue for franchise owners
-Core values focus on helping people become unstoppable versions of themselves
-Heights Wellness Retreat is unique in offering dual therapy approaches
-The brand aims to integrate ancient practices with modern technology
-Franchisees benefit from streamlined operations and higher profit margins
-The ideal franchise owner is passionate about wellness and community impact
-Relationships are central to the success of the franchise model

https://www.heightswellnessretreatfranchise.com/


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Mike Halpern, CAFC
mike@franchiseqb.com

This is the Franchise QB Podcast, where we empower entrepreneurs to win big in franchising. We huddle up weekly to educate our audience about the most successful small business model ever created. Franchise it! Welcome to the Franchise QB podcast. I'm your host, Mike Halpern, a 20 year industry veteran and entrepreneur. My mission is for listeners to achieve their American dreams of creating wealth and independence through franchise ownership. Every week we speak with franchisees, franchisors or vendors that support the industry. Thank you for joining us and let's get started. Joining us in the huddle today is Shane Evans, co-founder and CEO of Heights Wellness Retreat. Welcome to the show, Shane. Thank you for having me, Mike. I'm glad to be here. Great to have you. So you have 20 years of experience in franchising, primarily with emerging brands. You co-founded Massage Heights, a membership-based massage and skincare franchise, and Elevated Brands, a management company that helps founder-owned and operated businesses grow through the franchise model, which is really cool. You currently serve as the CEO and vice chair of Massage Heights and the COO of Elevated Brands, overseeing the development and operations of your portfolio of brands, including Massage Heights, the Gents Place, and Summit Franchise Supply. Also, you're an IFA board member and you're working towards a BBA from the Harvard Business School of Executive Education. I got it all out. You accomplished a lot, Shane. So tell us a little bit about your journey so far and then we'll get into your franchise brand. Yeah. Well, I guess I would just say I grew up in San Antonio, Texas. My mom and dad were pretty entrepreneurial. They both had daytime jobs and hustles, you know, on the side. And those were often marketing sales based, you know, jobs and or businesses, I would say. And so I think I've been around entrepreneurship for a long time. and was inspired by my parents' journey and really wanted, I think I just grasped onto that. Early in my late teens, I started working for a health club and I became a manager and I moved up through that company and that's where I kind of really learned membership-based models, the value of that from a business perspective. Also, that's where I fell in love with just health and wellness. And at some point in those younger years, I had a back injury that was wild and it would, I was hurt from it at least once a year and I would see a chiropractor about it, but that was the wrong thing for what I had. And massage therapy was the answer. And so I fell in love with the benefits of massage therapy and skincare, which kind of led to the eventual founding of Massage Heights. But yeah, I've been doing this for 20 years now. We're an established brand. It has been my life and often the life of my family as well. As I think all entrepreneurial people know, when you get into business, you're all in, and it's not just you, it affects your entire family as well, as your employees and everything. And so this has been so much a part of my life, and I did step away for a few years, and I came back in in February of this year. Really a very clear vision for the brand going forward. It's been awesome. The franchisee reception of having me back has been incredible and inspiring and invigorating. And it's just been so much fun to be able to put that vision into place, which we'll talk about later. But yeah, it's been an amazing ride. I love franchising. I love the opportunity it provides for so many people to get into business for themselves, but not by themselves as we say in franchising. And the community of people in franchising, I think really just wants to help others do better and be better and accomplish their dreams. And so the executives in franchising and the business people that we work with, business coaches and brokers and so on and so forth, everybody just is very, it's very community oriented. And I think it's because we're all so focused on helping people be successful in their businesses, our franchisees be successful in their businesses. that we also enjoy helping one another be successful as franchisors and people in the industry that really support the space. So it's fun. I totally agree. I think that collaboration is what makes our industry unique and great. And I'm sorry to hear about your back injury, but it sounds like you made kind of lemonade out of lemons and it led you to this amazing career in the massage space. So you added a little bit, the evolution of the brand. I want to talk about that first because you have hit The 100 unit mark, which is a really big deal for a franchise chain. You've been at it for 20 years and previously you were franchising the brand and I'm sure the majority of the inventory is under the Massage Heights brand. New branding is Heights Wellness Retreat. So tell us a little bit about the evolution of the brand. Yeah, well, just say, know, Massage Heights journey has been two decades, right? And I think that's a testament to resilience and to innovation and commitment to wellness. So we started in 2004 with the first location in Alamo Heights in San Antonio, Texas, and we've grown into over 100 operating units. And I would say that reaching this milestone has been, you know, it's significant in the life of a brand, not very many brands actually see that milestone. I think it's something like less than 16 % ever surpassed 100 units of well over 3000 franchise brands. This to me really underscores our proven model, which combines operational excellence, franchisee support, just a commitment and a focus on the guest experience. so, I'd say that that growth reflects the trust of our franchise network, our members and guests, but it's been 20 years. And so we're very proud of the impact that we've made, but we're equally excited about the next chapter of the brand. And that is Heights Wellness Retreat, which we'll talk about here. here as well, but we're elevating our offerings to our existing guests and members, which is also good for our franchisees. So just diversifying the offer to the consumers because it's what they want. Yeah, I want to dive into that. I want to learn a little bit more about in the new Heights Wellness Retreat business model, what additional services are your consumers able to enjoy and your franchise owners able to offer? Yeah, so the one thing I want to make sure that I'm clear on is that, you know, we are, are going, we are still heavy on massage and skincare because it is the core and it's, it's a proven business model for us. So we are, what we're doing with Heights Wellness Retreat is we're combining those traditional hands-on services like massage and skincare with the touchless therapies that we're offering. Red light therapy, cryotherapy, halotherapy, which is, which is assault type of therapy. and then meditation and vibration. Well, we've had a very strong membership model from day one and we'll continue with that membership model. As you know, I'm sure the recurring revenue model is really designed for financial sustainability and scalability and it offers members regular access to wellness. And so we'll continue on with that very strong membership model that we've always had. And then as we bring in these touchless therapies, the innovations as we're calling them, they're innovative, you know, revenue streams. So the touchless therapies represent, I think, a breakthrough for our franchisees because of the minimal labor that's required and high profit margin structure on those services. So these just, you know, create an opportunity for the franchisees to really diversify the revenue while keeping low overhead. And then from a target market perspective, we're, you know, that are Our consumers are really wellness conscious individuals, particularly with a focus on millennials, Gen Zs and Gen Xers. They're seeking more holistic wellness today and innovative and accessible solutions to their physical and their mental wellbeing. We saw a lot of that come out of, you the last five years post COVID, et cetera. There's far more, I think, openness about mental health and physical health as well. And so we're just in a prime spot to be able to roll out Heights Wellness Retreat in this more holistic solution, which is what the consumers are looking for. Yeah, you kind of answered my next question about the trends in the space. Obviously, it's moving in that direction and you guys are adapting to it. So tell us about what is the overall market opportunity for Heights Wellness Retreat. Well, mean, the wellness economy alone is projected to be like 5.6 trillion this past year, I think. And so something like 8.5 trillion in 2027. So there's a huge, massive opportunity in the wellness space in general. so by providing transitioning from massage heights to heights wellness retreat, really provides us an opportunity to really open up the offering that we have for our guests and members. So we're really not so much focused on just spa, but overall wellness. However, the spa industry generates about $19 billion annually and it continues to grow at about 5 % per year. So we don't want to go away from that proven model that people really can appreciate those hands-on therapies. So integrating the two will be integral in the success of Heights Wellness Retreat. cryotherapy and red light therapy and some of the other ones that I've mentioned are really, they're rapidly growing in the category now. And so again, with millennials, Gen Zs and Gen Xers looking for tech integrated wellness solutions, as well as just a very holistic environment to take care of themselves, we feel that we are well positioned and that we've got the opportunity to capture significant market share in this growing market over the next several years. Yeah, you talked about your core services being on that recurring revenue basis. And I see that as kind of a win-win for the franchise owner and the consumer. franchise owner has that repeatable, predictable revenue and they can budget accordingly. And the consumer is like, great, I this other service to look forward to month in and month out. That's right. It makes for a really sticky business model. You're developing relationships with people, now with offering them more services that they're interested in. It makes it an even stickier business model. It's a very much relationship oriented model. It's not transactional. We see our members at least once a month, if not more frequently. With these touchless therapies, we see that increasing substantially as well as the price of our memberships. our memberships will go from being on average about $85 a month to being closer to $200 a month. So, there's a great opportunity there. More importantly, think just sticking with that model that we know has worked and that's a commitment to people for excellence as well as the commitment that they make to themselves for health and wellness. And so I just see a lot of the great numbers that we already have, which I wouldn't necessarily share here, but the numbers that we have with retention rates and all of that, I can see that really improving over the course of. the next several years. So it's a good space to be in. Yeah. Well, thanks for that. So let's talk about 2025 and beyond. What is your vision for the future of the company? Yeah. So we're expecting significant growth from a licensing perspective this next year. We've already seen it. We re-registered amended our FDD at the end of, towards the end of the year or in the first part of this last quarter to be able to offer these Heights Wellness retreats. have already awarded several of those licenses and we'll be opening those up in the next several months in Los Angeles, Las Vegas and in Dallas. And we'll continue to every location or every license that we award now will be a Heights Wellness retreat. we plan, we have got 15 of our existing locations that are committed to converting. So a lot of our franchisees will be converting this year. And those are the commitments that we've just gotten recently. So we actually see that being. for greater as well. our plan is that all of our locations, well over 100 locations are converted by 2028 to Heights Wellness Retreats, showcasing a more unified vision of holistic wellness. We'll continue to focus on touchless therapies and those modern wellness trends as part of our core offering. And also we'll continue to compliment the existing offering of massage therapy and skincare with add-on services. such as scalp massage has become a really big thing. Something else that is significant in this industry right now is lymphatic drainage. And so those are services that we're offering as well. So again, just growing upon the current offerings that we have and to stay ahead of the trends on those touchless therapies is really the future. But Heights Wellness Retreat is innovative. It's exciting. There's technology. It's personalized. It's holistic. There's a lot of energy to the brand, but there's also this peace and the journey as you come into Heights Wellness Retreats is really a place of serenity and just reconnection and we'll continue to hone in on the personalized aspect of that. Yeah, I looked at some of the imagery of the new look and feel and I definitely got that vibe that it's somewhere you can go and it's like a sanctuary. It's like you know, a place of zen, a place you can kind of step out of the chaos of the world and just really kind of decompress it. That's pretty cool. Well said. kind of take a step back and talk about the core values of the company. I know those are really important to you, so I want to touch on that as well. Yeah, so we built Massage Heights off of the core values of loyal, authentic, passionate, and diligent. And those values are still very important to us. But as we are re-energizing the brand, we're sort of treating all of this like building Disneyland and if you can build a business from the ground up, what does it look like? And you know, taking the successes that we've had from Massage Heights and keeping all of those great elements. But one of the things that we did is we stepped back and took a look at our values as well. And part of who we are of Heights Wellness Retreat, our passion is really about helping people be unstoppable. We believe that people are all, you know, lot of our, A lot of times we put limitations on ourselves, right? And we don't know the power that we are. And sometimes we just need some help along the way. But we want to help people be the unstoppable versions of themselves that they are. we believe that can do that. Thank you, thank you. We love it. And we love that mission and purpose. what we do is we help transform lives through wellness. And I couldn't think of a better mission or purpose. than that, it's super exciting. And so our values are really aligned with that as well. And just to kind of touch on those, one of the values is anything is possible. And that's about challenging the status quo and embracing a mindset of limitless potential. And I think that's important, not only from a corporate perspective, but also from a franchisee perspective, that we're working hand in hand together, that we're collaborative, that we're transparent, that we... that we talk through things and we believe that together anything truly is possible. And that is the same thing that we're instilling upon our team members and the guests and members that come into Heights Wellness Retreat. The other one is leading with heart and that's about compassion and care, guiding everything that we do and building strong relationships in our thriving communities. And that starts with our relationships with our franchisees. And of course the way that the franchisees affect their communities. and leading with heart and empathy and getting involved in their communities. The other one is purpose over pride. And that's a mission that we forego individual egos and that we focus on the team and the betterment of everyone and that we foster collaboration and shared success. And then the other one that I love of course is fiercely obsessed with success. And that is that we're a results oriented, passionate organization. that we care about excellence and commitment to our empowering our franchisees to achieve their goals, and that we empower our guests and members to achieve their fitness and wellness goals as well. So those are our new values as we endeavor upon Heights Wellness Retreat and the energy of this new endeavor. Yeah, it sounds really exciting. Thanks for sharing that with us. I wanted to touch on some of the key differentiators for the new brand, and you've touched on quite a few of them. already on this conversation, but when you look at Heights Wellness Retreat and you stack it up against its peers in the industry, what kind of stands out for you as kind of the key differentiators? Well, we are the only brand that is doing anything like this. And so we'll be the biggest brand doing this. And with the growth that we have planned for this next year, we definitely will be the largest and only doing it. I would say for some extended amount of time. would say to answer your question directly, the dual therapy approach, that's what's different is we've got both the hands-on with massage therapy and skin care along with the touchless wellness services. So the red light and halo and vibrational therapy, et cetera. So that really caters to a broad spectrum of wellness needs and provides a more personalized and comprehensive wellness experience for the guests. So I would say that that is one big one. We know what we're doing. We do this membership thing well. We do massage and skincare well and integrating these touchless therapies just makes a whole lot of sense for our model. So also integrating ancient practices, I guess, with modern technology. So we're just at the forefront of these wellness trends. And I anticipate that these innovative therapies really do empower our guests to take charge of their wellbeing and in a more customizable way. So that's different. Also, streamlined operations for the franchisees. The touchless therapies really reduce the labor demands. And so that provides franchisees with additional revenue streams that are just easier to manage than more people. And so that helps them focus more on the guest experience and franchise growth opportunities. And because of that, higher margins in the business model. And the expanded suite, of course, is going to help them serve more customers in their area. So yeah, we're super excited about the revenue opportunities for our franchisees, but more importantly, the profitability for the franchisees based on this approach of kind of dual therapy and less labor intensive costs. Well, let's talk about where you're growing because geographically, you mentioned LA. I think you said, was it Las Vegas and Dallas? Yeah, those are those ones that are opening up in the next couple of months. from there, I mean, we're we're really focused on prime territories throughout the US. I just say, you know, there's not necessarily a market that we we could not develop in other than really South Texas, San Antonio specifically. Outside of that, there's still a lot of room in Dallas, Fort Worth and and even in Houston, where we have a heavy concentration of of massage sites locations that will be converting. But you know, we're really looking for regions with strong wellness conscious demographics I'd say coastal cities and metropolitan hubs and affluent suburban markets So I know for your network really it's it's the bottom line is that we've got the infrastructure and the ability to grow most anywhere And we're already in key markets that we can continue to to fill and service Yeah. it sounds like there's a lot of opportunity for growth. I a hundred units is quite a bit, but there's a lot of opportunity for growth. So let's talk about, you know, someone listening really likes the wellness space. They like the fact there's a strong recurring revenue model and you're kind of evolving with the times and opening up all these other different service ideas and revenue streams. What are you looking for in a franchise owner? Who is a good fit? Who's the ideal franchisee for Heights Wellness Retreat? I'd say first and foremost that somebody that is passionate about wellness and driven to make an impact in their communities. I think you have to be a people person. Somebody that really does care about serving others and helping lead others and growing others. Strong communication with a commitment to operational excellence is really important. We are an elevated brand and we wanna make sure. deliver on what we call our Cloud9 experience each and every time. I'd say somebody that's business savvy with leadership experience and more so of a collaborative mindset. We are a collaborative organization. We work tightly with our franchise advisory council and with our franchisees. And so, you you don't have to be, you know, excellent with finances or anything like that. We're going to train you on all those things and support you right from the get-go. So really all back. can succeed in our system, but it's more about a commitment to the business and having a fire in your belly and passion for health and wellness. Okay, very cool. So what does the staffing model look like for a franchise owner? I mean, you basically talked about the surfaces that are touchless and obviously the massage and the facials are more hands-on. What does it look like for the new owner to fully staff their business? Yeah, so I mean, you've got a retreat directory of the assistant retreat director. That's your management staff. We normally have one lead therapist, which is the one that helps on board massage therapists and skin therapists. And they do, you know, their training and and you know, massage therapists and skin therapists are all already trained and certified. They've learned their profession prior to coming to Heights Wellness Retreat or Massage Heights. But we're going to train them on the massage heights methods. And so the lead therapists will do that. And then you're gonna have your massage therapists and skin therapists. And that's gonna be about an 80-20 mix, 80 % massage therapists and 20 % or so skin therapists. And then with this hybrid approach, you don't really need personnel for the touchless therapies. You have some people that can help with some of those things that are already on your staff. So it really just kind of depends on the number of treatment rooms, but I will say the majority of our franchisees have about 15 or so employees. So it's not too much to manage. Got it. So let's talk about item seven. Like what does it cost to open a Heights Wellness Retreat? Give us kind of a general range. I know it's going to depend on the footprint, depend on the space and the condition of the space, but what's kind of our item seven? Yeah, it's $578,000 to about $652,000. That includes, you know, obviously it's everything. It's your operating capital, it's your leasehold improvements, it's your initial training, it's marketing, it's equipment costs for these touchless therapies. So that is all inclusive. Got it. And you mentioned before about the performance. Are there any item 19 FPRs you can share or would you direct candidates to go check out the FDV? Yeah, I would definitely go check out the FPD, but just kind of high level. Our system wide average is over a million dollars nearing $1.1M with about 10 % of our franchisees at well over $2 million or $2.1 million. And so I did talk about it a little bit earlier, but we've got about a 95 % member retention rate also reflected in the FPD. So that really demonstrates the satisfaction that our guests and members have with the brand. But yeah, definitely check out the FDD and you're going to see those numbers in the item 19 are all reflective of the Massage Heights business model, which we're maintaining the core of that model in massage and skincare along with the membership. So what we're anticipating is as we're opening these Heights Wellness Retreat doors, you can anticipate that we're going to see even stronger revenue than that. Yeah, and I mean, an average of over a million plus top 10 % doubled at 2 million plus. I that's really impressive numbers for this model. This has been great, Shane. I really appreciate all the information. Anything else you want to add to the mix before we wrap up today? Oh, I don't think so. think we're just really thrilled to bring this model to you all. We've gotten a lot of great feedback from the franchise community, from our friends and business coaches and brokers. And our franchisees are thrilled with the changes that we're making. I couldn't be more excited for the future and we would love to work with you guys. If you've got candidates that you think would be interested and that fit the profile, we'd love to talk to them. It's a great, great business model and it's proven. And we've got an incredible staff that's very committed to franchisee success. We are obsessed with your success. And so I think that's really important. And you know, just... The last thing I'll say is we are still a family owned and led business and relationships are at the heart of what we do, not just at the retreat level, at the store level, but with our franchisees. And I think that is another big differentiator between Massage Heights and some of the other brands that are out there. Yeah. Well, I look forward to you guys opening some in the greater DC area, Northern Virginia. Sounds like a really fun place to go and get those services. So if anyone listening would like to connect with Shane to learn more about becoming a Heights Wellness Retreat franchise owner. contact me at franchiseQB.com or on X at QB franchise QB. I'll get you connected. Thank you so much, Shane, for taking the time to get in the huddle to discuss Heights Wellness Retreat with us today. Oh, thank you. I appreciate it. All right. Thank you for listening to the Franchise QB podcast where you're at the helm of your future as a franchise owner. If you enjoyed the content, please rate the show and recommend it to anyone that might be interested in franchising. Make sure to visit FranchiseQB.com to subscribe to my newsletter. and for an actionable playbook to go from walk-on to legend in your new business. Follow us on Twitter @QBFranchiseQB, and join us every week for a new episode. See you next time. Visit franchiseqb.com to take the next step of your journey towards wealth, independence, and franchise ownership. And remember, when working for the man gets old, you must do something bold. Thank you for listening.