Hair no more….

Regis to close 160 salons in effort to shave operating costs

Edina MN-based Regis Corp. said Wednesday it will close about 160 underperforming salons in the United States, Canada and United Kingdom in the next six months as it tries to cut costs. Four of the stores will be in Minnesota, though a company official declined to offer specific locations.

The stores make up less than 2 percent of the chain’s 8,500 company-owned salons, which operate under the names Regis Salons, MasterCuts, Cost Cutters, Supercuts and Trade Secret, among others.
The closings come in addition to the 200 or so low-performers that Regis typically shuts down each year when leases run out, Regis CEO Paul Finkelstein said. The company said it would offer employees jobs in nearby salons.

“Every store that opens isn’t a home run,” said Stan Pohmer, a Twin Cities retail consultant. “At some point you have to identify your chances of turning them around. … It’s just good business management to go in and cut out the low-hanging fruit that’s sucking all your resources out. It’s not something that hints at problems endemic with the company.”

Regis expects to shutter 100 stores at regional malls, 40 at strip malls and 20 in the United Kingdom. About a third of the closings will come from the struggling Trade Secret stores, the rest from a “myriad of brands,” Finkelstein said. Many of the stores were located in malls that were struggling or in strip centers that had lost major tenants.

None of the 2,178 SmartStyle salons that operate in Wal-Mart SuperCenters will be closed, Finkelstein said.
Regis expects to record a pretax charge of $20 million to $25 million to close the stores before the end of their lease terms, a cost Finkelstein said will ultimately boost profits by reducing the drain on time and resources.

Regis said it will write down $4.5 million, or 6 to 7 cents a share, in the fourth quarter, which ended June 30. The remainder of the charges will be recorded in the first half of the fiscal year.
Shares on Wednesday closed at $26.81, down almost 2 percent, in a day most of the market’s major indexes closed down by a similar amount.

Regis has spent the past 18 months focusing on internal efforts to reduce costs, including consolidating contracts for janitorial services and office supply vendors and reducing the number of small parcel posts.
Combined with price increases across nearly 6,000 locations, Finkelstein said, the measures helped boost third-quarter net income.

Meanwhile, Regis is pushing forward with new concepts despite cutting its new-store construction in half as consumers make fewer visits to the salon for haircuts, products and other services.
On Aug. 8, Regis plans to open what Finkelstein describes as a “quality, high-end barbershop” called Raze, located off of Hwy. 62 and Shady Oak Road in Minnetonka. Haircuts will run $25 to $30, and come complete with hot towels, Internet access, bottled water and other amenities.
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Spa Closing, Spa Closings

BANKRUPTCY FILING

As the economy slows, the nationwide Solana chain of 50-plus franchised medical spas has locked its Irvine headquarters, filed for Chapter 7 bankruptcy, shut down its Web site, and disconnected its phone.  Their website indicates that another site is being developed by Higher Images.  Higher Images is a SEO and Internet Marketing and web design company.

The following is from a Medspa Blog:

Solana Medspas is out of business?

Neither the company’s chief executive, William Maya, nor its bankruptcy attorney could be reached for comment.

The company founder, John Buckingham of Mission Viejo, said he sold Solana on Nov. 20 to a private equity company in San Clemente and could not speak in detail about its current status.
Buckingham remained a director of the company, which helped entrepreneurs set up medical spas that provided spa services plus non-invasive cosmetic medical procedures such as Botox injections.

As recently as March, Buckingham predicted that the nation’s economic slowdown would help Solana MedSpas by freeing up new retail locations for its medical spas.
In an interview with CNN/Money, he said he was “excited about taking advantage of this year’s store vacancies to open another 20 locations in malls.”

At that point, he said Solana had 50 spas “located in upscale strip centers and lifestyle centers, which are typically open-air malls.”
In May, Solana struck a deal with cosmetic-laser company Cutera Inc. of Brisbane, Calif., which declared Solana the “preferred provider” for its products at medspas nationwide.
That announcement said Solana “has sold over 70 stand-alone retail med spas with others scheduled to be opened in 2008” and had established a new division, Solana MD, to open aesthetic spas in doctors’ offices.
Solana’s filing said it had $370,028 in liabilities but assets of only $11,713.

FRANCHISE ADS

Solana MedSpa franchises are still listed as for sale on franchising Web sites, with a total investment of $400,000 to $780,000.

The Franchise.com site, for example, says:
Solana MedSpas has forged a new medical spa model by combining cutting-edge aesthetics and wellness technologies with traditional spa therapies in a retail environment.
In a short period of time, Solana MedSpas has become a nationwide leader in medical spa development with a growing network of uniquely branded medical spas. With an emphasis on regulatory compliance, healthcare innovation, education, marketing and customer service, Solana MedSpas has emerged as the fastest growing developer of MedSpas in the US.

The Chapter 7 bankruptcy filing means that the company will be liquidated, not reorganized.

BANKRUPTCY DETAILS
Solana’s current owner is Strategic Connections L.P., which is listed in the July 7 bankruptcy filing as “c/o WEM Management Company, 422 Avenida Salvador, San Clemente.”
The company’s largest listed creditor is its owner, which had floated it a $160,000 loan.
Solana said it had income of $456,989 so far this year from its consulting services to owners and operators of spas.
It paid Maya $161,112 in salary from Nov. 24, 2007, through June 24, the bankruptcy filing said. Buckingham’s salary for that period was $148,918.
The one company-owned medical spa, Resolutions, A Solana Medspa, also filed for bankruptcy under its legal name, Solana Medspa Development LLC.
The Resolutions medspa, located in a Rancho Santa Margarita shopping center, closed suddenly two weeks ago without explanation, said a hairdresser working in the adjoining hair salon.
The medspa listed assets of $11,713 and liabilities of $121,329. It cited $0 as the value of its unsold inventory of cosmetics, cosmeceuticals and Botox, which were purchased for $51,388.
Irvine-based Allergan, the maker of Botox, is its largest creditor. The medspa owes Allergan $49,260, the filing said.
The Resolutions spa had income of $225,555 so far this year, its filing said.

MedSpa, Medical Spa, Spa Bankruptcy, Spa Closing, Spa Closings

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Customers of former spa will get money back

When Spa 151 on the River closed without warning in late January, hundreds of customers were left holding worthless gift certificates and gift cards.

Good Example of Why you should only purchase Spavelous Spa Gift Cards and Spa Gift Certificates!

On Tuesday, after almost four months of investigation and negotiation, Missouri Attorney General Jay Nixon announced those consumers will get their money back. Ashli and Scott Rowland, owners of the spa, and Brent Wills, a one-time business partner of the Rowlands, agreed to pay up to $103,000 in restitution.

The agreement will be enforced by the Cole County Circuit Court, where Nixon’s office filed a copy of the settlement. In addition, the Rowlands and Wills will pay $4,000 to the state to cover the cost of the investigation.

Since the spa closed, 358 consumers have filed complaints with the attorney general’s consumer affairs hot line, said John Fougere, press secretary to Nixon.

The voluntary agreement requires the Rowlands to pay $15,000 each and Wills to pay $30,000 into a restitution fund that will be managed by Nixon’s office. Should claims for restitution exceed $60,000, the Rowlands and Wills will be liable to cover up to $43,000 in additional claims, Nixon’s office said in a news release.

Spa 151’s troubles began during the divorce proceedings between Scott and Ashli Rowland. Late in January, Scott Rowland came to the spa, announced he was taking over from his estranged wife and changed the locks, according to several employee accounts. He told employees they could not honor the gift cards or certificates or accept credit cards. The employees, who as contract workers received a share of each sale as part of their pay, refused those terms, did not return to work, and the spa closed.

In an interview with the Southeast Missourian a week later, Ashli Rowland promised to make full restitution to all gift card and gift certificate holders. She promised at that time to set up a post office box to receive the cards and certificates.

But as complaints mounted, Rowland became impossible to reach and Nixon’s office promised to make her keep the promise.

“Consumers who paid up front for Spa 151 gift certificates did in good faith and had no reason to believe that the business was about to close,” Nixon said in the prepared statement announcing the refund deal. “Businesses that accept full payment up front for services to be delivered to consumers in the future have an obligation to deliver those services or provide refunds, regardless if they’re going out of business or experiencing financial problems.”

Neither Ashli nor Scott Rowland, both of whom have moved to Ashland, Mo., according to court records, could be reached for comment Tuesday. Neither could Wills, who operates an insurance brokerage in Jackson.

When Spa 151 closed, Wills said he had no responsibility for the operation of the business or the actions that forced it to close. He did acknowledge he was originally a partner in the spa and held a continuing interest in the property.

Putting it behind him

Investigators with Nixon’s office also found that Wills was not involved in the business when it closed.

“During our investigation it became fairly obvious that Mr. Wills hadn’t been involved in the business for some time,” Fougere said. “But he was willing to pay $30,000 to put this behind him.”

A new spa with no connection to the Rowlands or Wills, eDen Spa & Boutique, has opened at 151 S. Spanish St. The owner is Kristina Schumer.

Spa 151 operated at 151 S. Spanish St. for a little more than two years.

The refunds will be sent by the attorney general’s office from funds deposited by the Rowlands and Wills, Fougere said. Many of the complaints focused on gift cards sold in the periods immediately before Christmas and Valentine’s Day.

Of the initial $60,000, $7,392 will be used to reimburse credit-card companies that have already charged back the gift certificate purchases.

The additional $43,000 will be paid if claims exceed $60,000. Each of the Rowlands and Wills are liable for the amount, and Wills has opened a letter of credit with First Midwest Bank in Jackson with the attorney general’s office as the beneficiary to guarantee the payments.

Consumers who have already filed complaints with Nixon’s office and those who file complaints within the next 90 days are eligible for the refunds. Consumers seeking refunds will be required to provide proof of their purchase, Fougere said.

To file a complaint, call the consumer affairs hot line at 800-392-8222 or go to the attorney general’s Web site at www.ago.mo.gov.

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Day Spa, MO Day Spa, Spa Closing, Spa Gift Cards, Spa Gift Certificates

Companies facing closure must plan ahead

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It’s a truism of business that some fail — especially when the economy turns down — but companies can soften the blow to clients, employees and investors with planning and communication, experts say.

The issue moved to the forefront this week when O’Neys Salon & Spa closed after 35 years in business, leaving some clients with unredeemed gift certificates and unanswered questions about what to do with them.

A sign on a window at O’Neys Salon & Spa on Rahn Road reads ‘Closed permanently. Thank you for 35 years of business.

When it becomes clear that a company is facing its own demise, owners and senior executives have a moral obligation to alert customers, lenders, community leaders and others that the business will close, said Joseph Petrick, director of the Institute for Business Integrity at Wright State University’s Raj Soin College of Business.

Giving customers advance notice allows them to take advantage of gift certificates, Petrick said. And a heads up to employees gives them ample time to track down other work, especially in a tight labor market, and to make other preparations, he said. Companies that need to retain workers until the end can use bonuses and other incentives to keep them on board, he said.

Under certain circumstances, an abrupt closure makes sense, said Jay Janney, an associate professor of management and marketing at the University of Dayton.

A shutdown can be appropriate when prompted by such things as an owner falling seriously ill, a firm not having the money to pay bills or a fire or natural disaster striking a business, Janney said.

In some cases, a competitor can become an ailing business’ ally.

Janney said the owner of a foundering business can strike deals with competitors to have them honor coupons or gift certificates, and then clue customers into the arrangement. Giving customers somewhere to go when you close the doors keeps bitter feelings to a minimum, he said. And sometimes companies step up without prompting and agree to accept the gift certificates.

In the case of pharmacies and professional firms such as veterinarians, dentists and accountants, the owner often sells her customer list to a competitor who then can offer their services to the client.

Petrick said that business owners have an ethical responsibility to settle their bills before they close. One option, he said, is for a company to contact suppliers and see whether they can take back inventory rather than demanding payment for it. If that doesn’t work, Petrick said, a business also can try selling inventory to a competitor to generate cash to pay debts.

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Many spas incorporate ingredients like chocolate, champagne, honey and herbs into their treatments. Some guests enjoy these over the top treatments while others prefer a more simple approach. Even the most down to earth tomboy can enjoy a few hours at a day spa. There’s no better place to relax and de-stress. The trained professionals will attend to your every need and whisk away your cares. Many spas offer refreshing beverages and gourmet snacks for guests to nibble on. They are soothing environments created to be an oasis from the everyday world down to the last luxurious detail.

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Spa Business, Spa Business Plan, Spa Closing, Spa Gift Cards, Spa Gift Certificates

 

 

 

 

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O’Neys Salon and Spa, the second largest day spa in the Dayton area, has closed. The Kettering salon, which had more than 100 employees, shuttered for good on Saturday, according to a phone message at the spa.

Owners, sisters Judy O’Ney Roberts and Shirley O’Ney Barnhart, could not be reached for comment.

Located at 30 W. Rahn Road on the site that was previously a medical and dental center, the sisters bought the location for $1.2 million more than eight years ago. The 20,000 square-foot salon featured 40 hair stylists as well as massage therapists, aetheticians and manicurists.

Gregg Gorsuch, Kettering economic and development manager, said the city was not informed of the closing and he is uncertain what company may fill the vacancy.

O’Neys Galleria, the neighboring shop selling various items from women’s apparel, jewelry and soaps to sculptures, outdoor garden accessories and furniture, is currently closed, but will reopen on May 31.

The spa’s phone message did not offer details for the closing but did relay some sentiment.

“We appreciate your business for the past 35 years and we apologize for any inconvenience,” the message said.

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Day Spa, Dayton Ohio Day Spa, Spa Closing

Customers are greeted by this sign outside Thrillz Salon & Spa in PittsfordSquare

 

UPDATE 

UPDATE: Thrillz Customers Can Redeem Gift Certificates

 

The former owner of Thrillz Salon & Spa on Monroe Avenue now tells 13WHAM News that he’s made arrangements to honor gift certificates of past customers.

 

James Scibilia says he’s worked out a deal with “Made You Look Salon & Day Spa” at 2150 Monroe Avenue (244-5644) that will allow customers to redeem Thrillz gift certificates.  The owner of “Made You Look,” Kim Casciani, says she’ll discount services by 25% until the full value of each Thrillz gift certificate is redeemed.  Meaning it may take a few visits, but you will get your money’s worth in the end.

 

Scibilia also says he will personally honor the full value of any gift certificate for hair services alone at the “K Salon” at 1462 Monroe Avenue.  (271-3610)

3254 Monroe Ave Rochester NY 14618 (Pittsford Square) — Customers of a popular Pittsford salon aren’t thrilled to learn there’s no more “Thrillz.” With no warning to customers or workers, the Thrillz Salon and Spa shutdown suddenly on Sunday and disconnected its phones.

The salon/spa was open for nearly seven years and did a good business according to many former workers and customers. Now, customers with appointments are greeted with a makeshift sign outside of the door that reads, “Salon is closed, no info at this time.”

“I know nothing,” Elizabeth Francescotti said when she showed up for her Thursday evening appointment. “I had no idea there was no more spa left!” Ellen Breakfield was also not informed that her appointment would not be kept.“I have to figure out what to do…I have to get my hair cut before graduation,” she said.

Some of those Thrillz customers showed up for appointments with gift certificates in hand, wondering how they could be redeemed if the phones don’t work and nobody’s inside. “I bought two, $200 gift certificates and I was going to share them with my good friend Janis here,” Bernie Maurer said. “They could’ve at least given us the courtesy of calling and saying that they were closing,” Bernie’s friend, Janis Tomei, said. Employees were also left in the dark about the closing. Many workers said Saturday’s full day of business seemed absolutely normal.

Sandy Kesel, a former Thrillz worker said, “It was just a regular Saturday, we were selling gift certificates; we were doing services. People were coming in and buying product. We had no idea that they were going to be closing the doors on Sunday, we had no idea.” According to Kesel and some other Thrillz workers, they learned of the sudden Sunday closure only by chance.

“One employee happened to be driving down Monroe Avenue and saw a big U-Haul truck in front of a salon,” Kesel said. “That’s how we all found out.” The New York State Attorney General’s Office said closing without warning isn’t just bad business; it could be against the law, especially if employees are unpaid or customers are left with gift certificates or credit that can’t be redeemed. “Owners are still responsible to reimburse consumers who pay for something that they didn’t receive,” Assistant Attorney General Carlos Rodriguez said.

For now, customers waiting for answers as proms, graduations, and weddings approach are left with just one option–make another appointment elsewhere.

13WHAM News contacted the Thrillz owner and he said financial reasons forced him to close. He also said he wants customers to know they’ll be reimbursed, and that he hopes to provide 13WHAM News with a contact phone number or email address in the coming days.

In the meantime, representatives from the Attorney General’s Office are asking customers with complaints or salon credit to contact the Rochester Regional Office at (585) 327-3240, or, go to the Attorney General’s Web site and fill out the online complaint forms

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Spa Business, Spa Closing

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eDen Salon & Boutique to take Spa 151 location

97 N. Kingshighway
Cape Girardeau, MO 63701
(573) 335-3500
(573) 335-3379 fax

REVIEW THIS SPA NOW

The lodgings of the defunct Spa 151 on the River at 151 S. Spanish St. will soon be occupied by eDen Salon & Boutique, which currently resides at 97 N. Kings Highway.

Kristina Schumer was issued a business license recently to open her business at the new location. According to the paperwork at city hall, she expects to be open there by May 1.

For those of you who may have forgotten, Spa 151 closed in January during a messy divorce case between the owners Ashli Rowland and Scott Rowland. When the spa closed, it left employees grumbling that they had not been paid and irate customers holding apparently worthless gift cards and certificates.

Ashli Rowland promised to refund the outstanding gift cards and certificates, but she has been unavailable since that interview. I reached Scott Rowland a few minutes ago, but as soon as I identified myself, he hung up on me — again.

Customers have responded to Rowland’s lack of follow-up by filing consumer complaints with the Missouri Attorney General’s office. I’ve got a call in to the AG’s press secretary, John Fougere, but I counted 330 complaints on the AG’s Web site, almost triple the number of one month ago.

Schumer has no apparent connection to Spa 151. I’m waiting to hear from her as well.

Meanwhile, the divorce is moving forward, with a trial setting scheduled for June 10 before Judge Benjamin Lewis.

And the looming divorce and investigation by the Missouri Attorney General aren’t the only legal issues dogging the Rowlands. They were partners in a statewide chain of Check Please locations prior to last October, and in February they were sued by The Great Eight LLC, a land company owned by the Buchheit family, for failure to pay rent on a Perryville, Mo., building leased by Check Please. Eric Bohl, attorney for the the Great Eight LLC, said the lawsuit alleges that the Rowlands stopped paying rent after closing the Check Please branch.

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Missouri Medical Spas • Missouri Day Spas

 

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Aveda Spa, Day Spa, Spa Closing, Spa Opening

 

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FAIRMONT MN— What began as an elite salon in Fairmont has closed its doors.

Essence Salon and Spa on Downtown Plaza has a “Closed” sign taped on the door. An empty room and empty display cases are visible from the door.

Attempts to reach proprietor Melanie Harder were unsuccessful Monday.

Essence originally opened as an Aveda Salon in 2005. The building was remodeled as a day spa, offering hairstyling, skin care, facials, manicures, pedicures, hair removal, body treatments and massage.

Rumors swirled about Essence closing in December, after the loss of some employees and dwindling stock on the shelves. But Harder insisted the salon would stay open, while no longer carrying the Aveda line of products. She said then that the Aveda affiliation ended because of strict sales requirements.

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Day Spa, Spa Closing

 

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Georgette Klinger Employees File Class Action Lawsuit in Federal Court

A Class Action Lawsuit on behalf of over 300 Georgette Klinger Spa employees was filed in U.S. Bankruptcy Court, New Jersey, Case No. 07-20464(RG). Klinger filed for bankruptcy in about July, 2007 in the District of New Jersey because their principal office was located there. The Complaint demands Klinger pay hundreds of thousands in unpaid wages and benefits due employees. The suit, filed by attorney Susan Chana Lask (www.appellate-brief.com), on behalf of the employees seeks class action status to represent each of the over 300 employees affected. Should they prevail, each employee who was summarily fired would benefit.

Klinger abruptly closed its doors to employees and customers without warning on December 18, 2007, despite knowing they allegedly filed a July, 2007 bankruptcy and would close. The lawsuit holds Klinger liable for never notifying its employees 60 days before closing as mandated by federal law called the Worker Adjustment and Retraining Notification Act, or WARN. WARN mandates employers with over 100 employees to give 60 days notice of a closing. “All those dedicated employees who provided massages, facials and skin care that kept Klinger going for years will now have their day at the spa in Federal Court. They must be paid,” said Susan Chana Lask, attorney for the employees. WARN includes back pay and benefits for up to the entire 60-day period during which employees and the community should have been notified. In addition, the WARN Act provides for payment of additional penalties to the community through a civil penalty of up to $500 for each day of violation, up to the full 60-days, that notice was not given.

The Complaint alleges Klinger used the employees to work for the company up to the day of closing then shut their doors without warning and never paid them for two weeks wages. The employees lost wages and their family health insurance benefits without warning. The massive layoff violated employee rights under federal law according to the Complaint. Plaintiff Eugenia Sakharny, representing the class, wants her wages, “We thought something was wrong when they started taking supplies off the shelves and there were no more towels for customers, but management told us everything was ok.” Presently, the Georgette Klinger case is a Chapter 7 filing in the New Jersey Bankruptcy Court. In Bankruptcy proceedings, secured creditors are first in priority to be paid, then employees are to be paid.

Day Spa, Spa Closing