Do you want to open a beauty supply store business? Find here a guide on how to start and plan a retail beauty supply store business with tips on operational processes, resources, promotion, marketing, etc.
A retail beauty supply store or cosmetic store is a lucrative business to start from any location across the globe. Even this business is profitable in small towns and suburban areas. Broadly, you have three options to start the business.
The global Cosmetic market was 460 billion USD in 2014 and is estimated to reach 675 billion USD by 2020 growing at a rate of 6.4%. Of the cosmetic products, Skincare has the highest market share while oral cosmetics would be the fasted growing market during this period. The sale of cosmetics is seeing a shift from being traditionally purchased to buying online. Moreover, an increase in spending income, especially in developing countries is driving the market.
Firstly, you can launch your own brand. Secondly, you can start as a franchisee of a reputed beauty retail brand. And finally, you can start an online retail beauty supply store with comparatively small capital investment.
However, each and every approach has its own advantages and disadvantages. An online beauty supply store eliminates the retail infrastructure cost. A franchise opportunity allows you to enjoy a brand value and proven operating procedure of the parent company. However, your profit margin is less.
Launching your own brand allows you to access better profit margins and future possibilities of offering franchises. However, you must create a profit-making business model and a popular brand. In this post, we have detailed about how to start a profitable beauty supply store business for your ready reference.
Steps to Start a Profitable Beauty Supply Store Retail Business
1. Understand The Demand
First of all, you must understand how cosmetic and makeup works. It is better if you have previous experience in the cosmetics line. Furthermore, education background in cosmetology is always a plus. Conduct detailed market research and collect information regarding the demand and trends of the local community. However, You can also gather knowledge from books or online tutorials.
2. Decide The Beauty Products Line
This is an important aspect of this business. You will find a lot of beauty brands on the market. Also, some of them have specialization in herbal, organic or ayurvedic. Furthermore, cosmetics cater to a broad segment. It includes makeup range, hair products, skin products, and several other beauty and wellness products.
When you are starting your own product line, it is advisable to start with a concentration of a niche audience. Such as only makeup range or only hair care products. Even you can start a small kiosk with only lipstick or eyeshadow. As your business grows you can add new lines to your existing product range.
3. Craft A Business Plan for Your Beauty Supply Store
This is the most important step in launching a successful business. Furthermore, a business helps in achieving the short-term and long-term goals in the business. According to your product line and business model craft a detailed business plan. Determine how much space you will acquire.
Determine your target demographic. Whether your products are for girls or teens or men or a solution to an aging problem. What are your marketing and product promotion strategy? How will you compete with other cosmetics store? Finally, craft financial planning with capital investment, cash flow and expected rate of return.
4. Apply For Registration & Licenses for Your Beauty Supply Store
This is crucial. However, it hugely depends on your location where you want to start the business. It is advisable to talk with a local attorney about the statutory formalities. Furthermore, if you are starting your own product line get insured. Cosmetics can cause irritation, allergies and can provide an environment for growing bacteria. Definitely, you don’t want to be at the receiving end of a lawsuit without coverage for potential liability.
5. Secure Finance
There are a lot of options to get finance for a beauty supply store. However, you can apply for a loan for the working capital purpose. In this business, working capital includes the inventory, manpower cost, and other utility costs. Cash credit or overdraft facility is the best option for this type of capital requirement.
Related: How To Raise Small Business Capital From Investors
6. Acquire A Location
Other than an online beauty supply store, you must acquire a store location. Location does matter in this business. However, a shop-in-shop location is also a great option. You must generate the footfalls of your target audience. It is advisable to get the location on the lease. It will eliminate the initial cost investment of purchasing a retail space.
7. Setup Your Store
In any retail store business, it is important. First of all, it is better to have a floor plan. Talk to an interior designer who has experience in retail store designing. Identify the space for product display, cash counter, and small storage. Furthermore, concentrating on in-store branding. Maintain a clean, attractive and well-decorated store.
8. Operational Aspects
Choose a catchy and memorable name. A name that relates to your target demographic. Consider protecting your intellectual property. Talk to the vendors. Furthermore, you must procure quality products at a competitive price. In addition, you must have a retail point of sale (POS) software for daily operation and accounting solutions. Also, it helps in tracking store inventory.
Related: 15 Best Business Management Tools For Small Business
9. Hire Employees
Hire professionals and experienced employees. However, it is advisable to employ male and female employees. Sometimes female customers are more willing to interact with female executives. Ensure, proper product training is provided. It is crucial.
10. Promote Your Beauty Supply Store
For a niche beauty supply store, you must have the key selling points. Why your product is better. However, people are now showing more confidence in organic and herbal cosmetics products. Promote your business in local newspapers and fashion magazines.
Give the effort to build a long-term relationship with your clients. Offer launching discounts. In addition, outdoor advertising works well for beauty supply store promotion.