How to Start a Cosmetics Business
How to Start a Cosmetics Business : The cosmetics industry, according to estimates is valued at and churns in on a yearly basis, billions of dollars.
Of course, it is undoubted that the figures can only continue to increase, and increase the more.
But, prior to this time, the cosmetics industry used to be dominated by whole lot of multinationals as well as global brands. Today, however, there is an offspring of independent as well as artisan cosmetic companies who are equally performing excellently as market players.
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If you have a desire to own your cosmetics retail store? It can be achieved, even if you are not a makeup artist or savvy professional. All that you need is effort, time, right information, planning and commitment.
With these, you can even grow your small business into a big brand. Many great lines like Make-Up Forever and M.A.C. started as small boutique lines, so you can expand it. In the sections that follow, I take a rundown of all what you need to put in place so as to start and run your cosmetics business successfully.
How to Start a Cosmetics Business in Nigeria: Sample Business Plan Template
- Decide what brands to sell-: When starting a retail cosmetic store, you need to know what exactly you want to sell. You cannot sell every brand under the sun, so your brand choice should be based on demand in your locality and other criteria.
Remember that many major brands, have very large minimum orders or exclusive agreements that might pose limitation.
For example, some brands sell their products only in their own stores or in selected authorized dealers, so these products can’t be sold, unless you buy from dealers with excess supplies. Even at that, you cannot advertise such products because you are not an authorized dealer.
So, start by making a list of the brands you would like to sell. Then check for the terms and conditions that must be met before you can sell them in your retail store. You would find some that you can work your way around, while you can’t sell some, no matter what.
- Create a business plan-: As with most businesses, adequate plan is vital to successfully start a cosmetics retail store. The best way to ensure this is to write a detailed business plan. Unavoidable components of your cosmetics store business plan are, the mission as well as objectives of your store, your startup cost estimates, expansion plans, competition analysis, marketing plan, your target market, financial projections etc.
Your business plan will play two major roles;
- It will serve as a step-by-step guide towards launching your business successfully and running it effectively afterwards.
- It will come in handy when you need to present your business to third party funders, like investors and loan issuers.
3. Get your business Registered and Ensure you complete all the necessary paperwork-: Visit your local business registration office to register your business name. Choose a short name and easy to remember, that reflects your business idea. Registering your business as an LLC is recommended, as this will protect your personal assets. But if you are unable, you can register as a sole proprietorship.
Also, you should contact appropriate local agency to find out the licensing requirements for starting a retail cosmetics store in your locality. Typically, you will need to obtain licenses, business permits, tax ID, and trademarks, as needed. If you are employing other people to work with you, you will also need to get an employer ID. Aside that these are proofs that your business is state-approved, they are also necessary for obtaining wholesale discounts, bank accounts, and mark protection.
- Choose a location and acquire property-: Since the success of your business hinges largely on its location, choose your location carefully. The ideal location for your cosmetic retail store is an affluent area, since boutique cosmetics are aimed towards a higher-paying clientele.
The location must be a high traffic area, easy to get and must have lots of parking space. Once you have found a good property within a suitable location, buy it or lease it, depending on your financial strength.
- Set up your store-: Design the interior of your store so as to fulfil the expectations of your target market. Are you selling to younger or matured consumers? Think about this when picking out your decor. If you are in doubt as to what is most appropriate, go sparse and elegant with artistic touches to add personality. Remember that your store must be clean at all times, avoiding materials that are difficult to disinfect and maintain.
- Hire employees-: You will most likely need to hire employees to work with you. The number of workers you hire will depends to some extent, the size of your store, present and future, as well as other factors.
- Regardless of how many people you are hiring, ensure they are highly experienced and skilled in their respective positions.
- Advertise your Enterprise and Begin operations-: Soon After your store has been stocked with products, your next step is to start advertising it. Nobody will know your business exists if you don’t market it aggressively, especially when you are just starting. So, adopt multiple advertising techniques: free or paid, online or offline, direct or indirect.
Don’t forget to plan a big opening to get that first rush of customers. A good idea is to offer huge discounts or attractive bonuses to your first set of customers. This will attract more customers.
I am much sure you want to know how profitable this business is before starting up this business, I’m glad to let you know that it is highly profitable, you can make profit as high as N500,000 monthly or more depending on your investment level.
If you start small, you can make profit of N50,000 or more. So if you have enough fund to finance this business, you can decide to start in a big way.
If you directly buy products like the hair extension from the manufacturers, once you meet up with their target monthly you will definitely be rewarded with some cash, the exact amount depends on the company and what they produce.
I believe you have read this article through, please don’t hesitate to leave a comment, share your success story and if you have some challenges, feel free to ask question.