Why Many Beauty & Wellness Businesses in Singapore Struggled or Closed in 2025
A gentle, honest look at what’s really happening in the industry
Over the past few years, Singapore’s beauty and wellness landscape has evolved rapidly. While many salons, spas, and studios continue to thrive, it’s also true some operators faced closures during 2024–2025.
This reality can feel worrying for practitioners and clients alike — but the reasons behind these changes are more complex and systemic than they may appear.
Below is a clear, compassionate breakdown of the key factors shaping the industry today.
1. Rising Operating Costs Are Putting Pressure on Small Businesses
Singapore has always had a high cost of doing business, but in recent years several factors have intensified this:
Higher commercial rentals, especially in malls or high-traffic neighbourhoods
Increased labour costs, with rising salary expectations and adjustments for inflation
Higher product and equipment costs, especially for imported items
Utilities and operational overheads continuing to trend upward
For beauty businesses—which often operate on thinner margins—these rising costs can make sustainability difficult unless revenue scales in tandem.
2. Ongoing Manpower Shortages Across the Industry
Manpower challenges have long been a reality for beauty and wellness operators, and these pressures have become more pronounced:
Many roles are hard to fill with local manpower
Foreign hiring rules have gradually tightened over the years
Employers must meet salary benchmarks and quota requirements
Training new staff takes time and investment
A salon with too few therapists, stylists, or specialists cannot operate at full capacity, directly impacting revenue and customer satisfaction.
3. A Highly Competitive and Saturated Market
The beauty and wellness sector is vibrant — but also very crowded.
In many areas of Singapore, consumers have dozens of options within a short radius.
This leads to:
Price competition
Difficulty standing out without strong branding
Marketing costs that smaller businesses struggle to keep up with
Consumers spreading their spending across multiple salons instead of staying loyal to one
In a saturated market, even well-run businesses can feel the pressure.
4. Shifting Consumer Behaviours and Expectations
Clients today are more informed, more selective, and more cautious. Patterns we’re seeing include:
Desire for transparent, no-hard-sell pricing
A shift away from large prepaid packages
Preference for results-driven or medically supervised treatments
Demand for on-demand, flexible, or home-based convenience (when applicable)
Expectation of excellent service, hygiene, and modern techniques
When customers’ expectations change faster than businesses adapt, some fall behind.
5. Greater Emphasis on Compliance and Industry Oversight
Singapore has progressively tightened oversight over recent years in areas such as:
Employment regulations
Treatment safety standards
Sales practices
Licensing requirements for certain services
Health and sanitation
These are positive developments for the industry’s long-term reputation — but they also bring administrative and financial demands that some small operators struggle to meet consistently.
6. Internal Business Challenges Play a Role Too
Not every closure is due to external factors.
Some businesses face internal issues such as:
Poor cashflow management
Insufficient marketing or digital presence
Lack of differentiation in services
Inconsistent service delivery or training gaps
Rapid expansion without stable footing
These are common small-business challenges across all industries, not just beauty and wellness.
A Balanced Perspective: The Industry Is Changing, Not Dying
Despite the challenges, the beauty and wellness sector in Singapore remains active and full of opportunity.
Many businesses continue to grow because they:
Focus on quality and trust
Adopt transparent pricing models
Invest in staff training and client experience
Embrace digital tools and social media
Offer modern, results-oriented services
Stay compliant and adapt proactively
The salons that are thriving today are those that evolve with consumer expectations and economic realities.
Final Thoughts
The closures seen in 2024–2025 are not a sign of an industry collapse — they are a reflection of an industry in transition. Rising costs, manpower issues, and evolving client behaviour are reshaping how beauty and wellness services are delivered in Singapore.
For practitioners, entrepreneurs, and clients, understanding these dynamics makes it easier to plan wisely, adapt confidently, and support sustainable businesses.