MedSpas of America, Inc. (OTC: MDSP)
MedSpas of America, Inc. (OTC: MDSP) , founded in 1997, is a publicly traded Nevada corporation, with its headquarters in Atlanta, Georgia. The Company recently completed a reorganization and stock purchase of Virtuoso MedSpas, Inc. (”Virtuoso”), now a wholly-owned subsidiary of the Company. The Company intends to focus it’s resources on the development of the Virtuoso brand.
Virtuoso was founded by leading practitioners and accomplished executives in response to the growing marketplace demand for technology-based medical spa facilities. The standard Virtuoso medical spa model consists of a 2,000 square foot leased facility located in a high-end, retail shopping environment. Virtuoso offers non-invasive cosmetic skin-care procedures in a spa setting and supervised by medical practitioners. The Company intends to expand the Virtuoso brand throughout the USA to capitalize on, what industry experts are calling “the fastest growing segment of the medical industry.
Over the next year, the Company intends to acquire existing medical spas that are strategically located and convert those medical spas to the Virtuoso brand. While the conversion strategy is being implemented, the Company will also build new Virtuoso medical spas in new markets.
The Virtuoso management team, which includes experts and practitioners in the industry, in combination with successful executives, have joined forces to introduce VIRTUOSO Medical Spas to this dynamic marketplace. The Company offers non-invasive medical cosmetic skin care in a luxurious, relaxing and soothing atmosphere. VIRTUOSO Medical Spa provides all the pampering and service you would expect in an intimate 2,000 square foot spa. The ideal spa is located in affluent markets providing high visibility typically associated with retail and medical services.
The average VIRTUOSO Medical Spa achieves annual revenues of approximately $2.0 million in the second year of operations yielding EBITDA of 40% or $800,000. The Company is developing the Atlanta metropolitan market initially, with its intent being to roll-out Virtuoso nationally in the next five years.
Market Description
Medical Spas are the new kids on the spa industry block. While traditional day spas that offer massages, facials, aromatherapy and manicures number at least 14,000 in the US alone, true medical spas number less than 700! However, industry reports claim that more and more people are fast becoming familiar with the term “medspa”. In 2004, there was a 147% increase in the number of new medical spas. American Society for Aesthetic Plastic Surgery statistics indicate that demand for non-invasive medical aesthetic services has increased more than 450% throughout the past four years.
Only 10% to 15% of demand for medspa services is currently being met in the U.S. marketplace. Americans spent just under $9.4 billion on cosmetic medical procedures in 2003. In 2004, consumers spent $44.6 billion on anti-aging products and services, and the total anti-aging market is projected to reach $72 billion by 2009 (Business Communications Co., Inc., February 2005). Market indicators point to the consumers preference for non-surgical treatments. 2,000 Americans will turn 50 every day (1 every 8 seconds) for the next 20 years. Studies show the number of Americans over 55 will grow by 60% in the next 20 years and their buying power will exceed $2 trillion by 2007.
Demographic and Economic Trends
The MedSpa revolution has been closely linked to the growing baby boomer generation in the US. Baby boomers are generally considered to be persons born during the post-World War II birth rate boom, lasting from 1946 through about 1964. As a group, they are well educated, with 87 percent being high school graduates and one in four a college graduate. They are the wealthiest, most sophisticated purchasers. At approximately 75 million, baby boomers are the single largest buying group in the US today.
* The baby-boomers now make up 51% of the total U.S. population and they control 75% of the country’s wealth
* 12,000 Americans turn 50 every day (1 every 8 seconds) and this will continue for the next 20 years
* Americans over 55 will grow by 60% in the next 20 years and their buying power will exceed $2 trillion by 2007
However, while baby boomers are largely considered the main target medspa consumers, the variety of treatments and services available in medspas expand this consumer base even further. Procedures like Laser Hair Removal, Acne Programs, Deep Tissue Facials and non-surgical Cellulite Treatments attract men and women well outside the baby boomer bracket.
Other Economic Data
* 80 million people in the U.S. spend $500 million annually in hair removal procedures like waxing, shaving, and accessories.
* Over 1 million women spend over $1 billion each year on electrolysis and lasers.
* Ethnic markets in the U.S. spent $1.5 billion in health and beauty products in 2003.
Lifestyle Trends
In a society highly influenced by Hollywood, looking younger has become the best way to FEEL younger. Consumers are enthralled by the many affordable and ingenious way to re-live their youth.
A survey by the New American Academy of Dermatology found that 69% of women are bothered by signs of aging, particularly fine lines, wrinkles, uneven skin tone, facial hair and dryness. In the above 45 category, women feel their facial skin makes them look older than they feel inside.
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