Start a hot tub garden by following these 10 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple guide to starting your hot tub garden. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
Check out our How to Start a Business page.
STEP 1: Plan your business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How much can you charge customers?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a hot tub garden?
The startup expenses associated with opening a hot tub garden business are significant. They include:
First and last month’s rent for a commercial space
Build-out costs to make a space suitable for a hot tub garden
Hot tub installation costs
Hot tub chemical and equipment costs
High-end and luxury spas can cost between $9,000 and $18,000 each. When tallied with the other expenses, opening a hot tub garden can cost tens of thousands of dollars. It may even be a six-figure sum.
What are the ongoing expenses for a hot tub garden?
The ongoing expenses for a hot tub garden business are significant but manageable. The largest expenses are:
Rent for the business’ space
Energy costs for heating water
Chemical and other supply costs
Who is the target market?
A hot tub garden business’ ideal customers are people who want a private atmosphere, enjoy hot tubs, and have some discretionary income. Such people may be willing to pay a premium for access to a private hot tub, and they have the income needed to rent one. Most of your customers will be seeking a relaxing experience that they can share with close friends or family.
How does a hot tub garden make money?
A hot tub garden business makes money by renting its private hot tubs. Hot tubs are usually rented by the hour.
How much can you charge customers?
weekday afternoon rentals cost between $20 and $34 per hour
evening rentals Sunday through Thursday cost between $30 and $44 per hour
weekend rentals cost between $30 and $54 per hour
All of these rates are based on two people. Most businesses charge a small fee around $5.00 for each additional person.
How much profit can a hot tub garden make?
A hot tub garden business can bring in a significant revenue. For example, The Oasis’ location in Ann Arbor has 16 different private hot tubs. When all of them are rented on the weekend, the location can bring in $864 per hour.
It’s possible for a hot tub garden business to make thousands of dollars in one day. In a year, a successful business could have a high six-figure revenue.
How can you make your business more profitable?
A hot tub garden business can increase its profitability and attract more customers by adding additional services. A spa or tanning salon would be an appropriate addition.
What will you name your business?
Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Hot Tub Garden Name Generator
When registering a business name, we recommend researching your business name by checking:
- Your state's business records
- Federal and state trademark records
- Social media platforms
- Web domain availability.
It's very important to secure your domain name before someone else does.
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your hot tub garden is sued.
Form Your LLC
Read our Guide to Form Your Own LLC
Recommended: You will need to elect a registered agent for your LLC. LLC formation packages usually include a free year of registered agent services. You can choose to hire a registered agent or act as your own.
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
Small Business Taxes
Depending on which business structure you choose, you might have different options for how your business will be taxed. For example, some LLCs could benefit from being taxed as an S corporation (S corp).
You can learn more about small business taxes in these guides:
There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Additionally, learning how to build business credit can help you get credit cards and other financing in your business's name (instead of yours), better interest rates, higher lines of credit, and more.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.
Open net-30 accounts
When it comes to establishing your business credit, net-30 vendors are considered the way to go. The term "net-30," which is popular among vendors, refers to a business credit arrangement where the company pays the vendor within 30 days of receiving goods or services.
Net-30 credit terms are often used for businesses that need to obtain inventory quickly but do not have the cash on hand.
Besides establishing business relationships with vendors, net-30 credit accounts get reported to the major business credit bureaus (Dun & Bradstreet, Experian Business, and Equifax Business Credit). This is how businesses build business credit so they can qualify for credit cards and other lines of credit.
Recommended: Read our guide on the best net-30 vendors so you can start building business credit now, so you never have to worry about cash flow in the future. Keep in mind that poor cash flow is the #1 reason businesses fail!
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a hot tub garden business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
For information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources.
Certificate of Occupancy
A hot tub garden business is generally run out of a large space. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a hot tub garden business.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a location:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your hot tub garden business will be in compliance and able to obtain a CO.
STEP 7: Get business insurance
Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.
There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.
Learn more about General Liability Insurance.
Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
If you aren't feeling confident about designing your small business logo, then check out our Design Guides for Beginners, we'll give you helpful tips and advice for creating the best unique logo for your business.
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How to promote & market a hot tub garden
Hot tub garden business’ marketing efforts should focus on reaching people in the surrounding area who might want to rent a hot tub. Placing brochures in local businesses, running radio advertisements and creating social media ad campaigns may all be effective ways to market a hot tub garden.
How to keep customers coming back
Hot tub garden businesses can keep customer returning by enrolling them in a loyalty program that provides access to exclusive discounts. Customers who have come once will likely be interested in coming again, and a discount or special package can be the incentive they need to rent a hot tub again.
STEP 9: Create your business website
After defining your brand and creating your logo the next step is to create a website for your business.
While creating a website is an essential step, some may fear that it’s out of their reach because they don’t have any website-building experience. While this may have been a reasonable fear back in 2015, web technology has seen huge advancements in the past few years that makes the lives of small business owners much simpler.
Here are the main reasons why you shouldn’t delay building your website:
- All legitimate businesses have websites - full stop. The size or industry of your business does not matter when it comes to getting your business online.
- Social media accounts like Facebook pages or LinkedIn business profiles are not a replacement for a business website that you own.
- Website builder tools like the GoDaddy Website Builder have made creating a basic website extremely simple. You don’t need to hire a web developer or designer to create a website that you can be proud of.
Using our website building guides, the process will be simple and painless and shouldn’t take you any longer than 2-3 hours to complete.
STEP 10: Set up your business phone system
Getting a phone set up for your business is one of the best ways to help keep your personal life and business life separate and private. That’s not the only benefit; it also helps you make your business more automated, gives your business legitimacy, and makes it easier for potential customers to find and contact you.
There are many services available to entrepreneurs who want to set up a business phone system. We’ve reviewed the top companies and rated them based on price, features, and ease of use.
Recommended: Find the best phone system for your business; check out our review of the Best Business Phone Systems 2021.
Start A Hot Tub Garden In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
The ideal hot tub garden owner will be a believer in the relaxing, therapeutic potential of spending time in hot tubs. These people will be better able to promote the business, and they will be able to provide an even more satisfying experience to customers. Having basic mechanical skills will make troubleshooting any problems that arise with hot tubs easier. Being able to connect with people will help a business owner put customers at ease, so they can relax and enjoy their time in a hot tub.
Want to know if you are cut out to be an entrepreneur?
Take our Entrepreneurship Quiz to find out!
What happens during a typical day at a hot tub garden?
Business owners’ time is largely divided between serving customers and cleaning hot tubs between customers. This involves welcoming customers, giving them towels, notifying customers their time has ended, cleaning towels, and sanitizing hot tubs. When not doing these things, business owners manage their employees, pay bills, and market their hot tub garden.
What are some skills and experiences that will help you build a successful hot tub garden?
A hot tub garden business owner must know how to clean, sanitize, and maintain hot tubs.
There are several organizations that offer training programs. The Association of Pool & Spa Professionals has online and regional training programs that cover hot tubs. The International Spa Association hosts several conferences each year, and there are several educational opportunities at these conferences. The National Swimming Pool Foundation’s Certified Pool/Spa Operator Program is a third option.
Whatever training businesses owners enroll in, they should make sure it specifically covers hot tubs. Working with hot tubs is different from maintaining pools.
In addition to taking a course on hot tubs, business owners may also want to buy a few books that cover hot tub cleaning, sanitization, and maintenance. Books serve as handy references when an issue arises. The Hot Tub Bible and The Ultimate Guide to Spas and Hot Tubs are two titles that cover these subjects.
What is the growth potential for a hot tub garden?
The hot tub garden business is a relatively new business model. For this reason, most businesses tend to be small. They have just one or no more than a few locations. For example, The Oasis Hot Tub Gardens has three locations in Michigan. Neptune’s Lagoons has one location in Anaheim, California.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
What are some insider tips for jump starting a hot tub garden?
Many customers will be highly concerned with cleanliness. They’ll want to know that hot tubs are cleaned and sanitized in between each customer’s time in a tub.
Thus, hot tub garden businesses don’t just need to have a system in place for cleaning and sanitizing hot tubs between customers. They also need to communicate their system to customers so customers are confident in a business’ cleanliness standards.
The Oasis communicates this information well on their website. They explain how water is purified, what checks are in place and what inspections they go through. Business owners can follow a similar pattern by sharing this information on their business’ websites, over the phone with anyone who calls, and in person when guests ask.
How and when to build a team
Hot tub garden businesses need a team of employees from the outset. It’s not necessary to have lots of employees. At least a few employees should always be working, though. There are a few reasons to have several people available:
Hot tubs can be cleaned faster between customers
Employees are available to handle special requests from customers
An employee is able to address any problems that arise with hot tubs