How many times have you turned and twist your neck, each time a beautiful model walk pass you? How often and long do you stay glued to your favourite magazine, flipping through the pages, admiring beautiful model? Have you ever wondered why the models look so beautiful?
If you guess right, you will probably know that makeup is a contributing factor to such breathe taking beauties been displayed. In this practical guide, we will be looking beyond the joys and smiles, derived from flipping through pages of magazines, but rather, we will be looking at how you can start your own makeup business in 2021 and beyond.
Beauty like fashion is always in a constant flux, as the trends and fads changes faster daily, than the speed of light. There are always new trends when it comes to beauty, cosmetics and makeup business, which is creating more and more opportunities. But if we may ask again, how willing are you to take advantage of this opportunities?
According to research, the beauty industry contributed £28.4 billion and 590,500 jobs to the UK economy in 2018 for instance. In December the same year, the UK cosmetics sector was worth around £9.68 billion and was considered as one of the EU’s top five cosmetics markets.
You may have been interested in starting your own makeup business, but may not have known how to go about it, and the above facts has further stimulated your interest more and you are now all pumped up and ready to go and take a slice of the pie in the makeup business world.
The massive value we will create here will help you decide if you want to either create a product to sell in a store or sell online as you start your makeup business journey. In this practical guide, you will discover what it will take to start your own makeup business, how to market it, how to scale it and become very profitable.
But before we begin to dish out the values, we will want to ask, why do you want to start a makeup business? Your heart beat may be pumping so fast now, as you think of the answer, but you don’t have to worry, as we have listed the likely reasons why you would want to start your makeup business.
- The ability to start your own brand
- Fulfil the high demand for cosmetics
- Pursue your passion for beauty
- Set your own prices and scale your income
- Sell products in-store or online
The above reasons might not be your own reasons, why then do you want to start your own makeup business? But using the above as your why, will serve as your motivation that will carry you through the process of starting and scaling your makeup business.
Before you get started in your makeup business, it is important to know the different types of businesses in the cosmetic industry, as the makeup business has different product lines, ranging from Blushes, Lashes, lipsticks, eyeliners, mascaras, foundation and eye-shadows products.
Each of these products comes with a wide range of variations. For example, when it comes to lipsticks, you have glosses, crayons, mattes, metallics and more. And if your goal is to create any of these products, you will need to put your own personal touch on them and create a themed collection, so as to make you stand out from the rest of the products out there.
Please note that creating products like these may take several rounds of testing formulas and measuring qualitative aspects since you cannot release a cosmetic product that will not be safe to use or harsh to the skin.
Starting your own business is exciting, but it can also be confusing if you don’t have the right information, on how to go about it, but gladly, that is the purpose of this guide to provide you with every information you need on how to start and profit from a makeup business.
We have outlined the best steps you need to help you get started on the right track. With this guide, you will have an established beauty brand in no time. So let us cut to the chase
- CHOOSE A PRODUCT
We have highlighted earlier that the cosmetic industry has different product lines, so an important step before getting started with your makeup business is to choose a product that you can create with your own special touch that will differentiate you from the competition. It is advised that you choose a product that is of interest to you, as you would not want to create a product that you do not have interest in, but interest should not be the only factor, as there will be no need creating a product for instance, without a demand for the product.
Aside your interest and demand for the product you decide to choose, you should consider the cost to produce the product. Knowing the cost of production and everything else in between, will serve as a guide in anticipating the profit margin you will make from the product.
We recommend starting with only one or two cosmetic products before growing your business. By choosing one or two beauty products, you can perfect the process and start to build your customer base, so as to help you scale your makeup business, without so much financial strain on your part.
- CREATE A BUSINESS PLAN
The place of planning, whether it is in business or in life cannot be overemphasised. It is therefore imperative to have a business plan for your makeup business before you set up. Though your business plan was meant to be for your own reference, but you will need it to pitch to lenders, investors, partners etc., your business plan should also detail what your makeup business is all about, what you sell and how you intend to reach your customers.
Generally speaking, your business plan should include:
- A company overview
- Market research analysis
- The legal structure and general organisation of your business
- A breakdown of your beauty products
- An overview of your marketing and sales strategy
- A detailed financial outlook
- Your niche
- Your target market
- Your competitors
- Your financial forecast and funding
- Your product range
- Your beauty brand vision
- Your suppliers
- Your manufacturing and retail strategy
- Any and all files related to your business (contracts, legal documentation, tax information, etc.)
Your business plan as a compass and road map for your makeup business, and should be able to help you plan how much inventory you will hold for instance, what your ordering and shipping process will be, how to send invoice etc. basically, your business plan is your operational manual.
Your business plan should also help you identify your target audience, take a deeper look at your competition and also figure out how you can make your brand stand out.
- REGISTER YOUR COMPANY
Your makeup business should be treated as a professional business, hence it is required that you get it registered. You have the option of registering as either a sole proprietor, limited liability partnership or limited liability company. You may decide to seek the advice of a lawyer, so as to guide you on what the best legal structure for your business should be.
We will however, recommend that you register a limited liability company, as doing otherwise, will lead to personal losses, if the business fails in the future. For instance, in the event that an accident occurs due to one of your cosmetic products, with a limited liability company, you will be protected as an individual.
You will also need to get a tax identification number for your business from the revenue board, so that you can pay taxes, as you would not want your lovely business to be shut down in the future by the authorities, because your business failed to remit taxes. The tax ID is called an employer identification number (EIN).
Makeup business, like food business is a regulated business, and as such, some cosmetic and beauty products require approval by the Food and Drug Administration (FDA). We encourage you to check out the cosmetics page of the FDA website or other relevant agencies in your state or country, for specific guidelines on developing and labelling your product.
SOURCE FOR FUNDING
Your makeup business like every other business venture requires funds. We are not sure if you have already accumulated piles of cash to start your business with, but if not so, you will have to figure out a way to raise capital for your makeup business.
You could decide to take out a loan or seek for investors, if you don’t have your personal savings to start the business with.
If you are taking the route of a loan, you can reach out to a bank in your locality, but it is important to look out for best interest rates from the banks, before settling with one. Aside the banks, you should also check out the Small Business Administration, to see if you qualify for any of their offerings.
If the bank loan is not your thing and you decided to look for an investor, again your business plan will play a role here, and you should however be in the position to decide what type of partner will be best fit for your business. Will you prefer a silent or active partner?
Investors could be family members, friends or business associates, venture capitalists, etc., so long as the terms are favourable or the investor you choose will not be one to have any trust issues with in the future.
Additionally, some local organisations have grants available for new business owners. This money is often free, meaning you don’t have to pay it back, but grant application process is very detailed, so you must be willing to meet up with all grants application requirements, before you can be considered.
You can check out this post on how to get a grant for your business. https://freemoneydomain.com/how-to-get-a-grant-for-your-start-up-in-2021/
Startup costs for a makeup business will vary depending on the product you decide to create/sell and how large of an operation you are looking to run, but there are some basic costs that are pretty much standard across the board.
Here are some basic things you will investment in as a guide:
- Limited liability company
- Branding and website:
- Product photography or camera equipment: depends on state or country
- Product development:
- Warehouse: size and location is a factor here
- Marketing and ads: depends
- Packaging: depends
- Storefront and/or factory locations and lighting
- Creating a well-structured website
- Make-up accessories, for example, sponges, blenders, brushes and mirrors
- Logo and trademark design
- Display cases
- POS and business management system/software
- Staff wages
- Logo design
- Security systems
- Make-up products
There are cheaper alternatives to some of these investments, but going so cheap may affect your product quality and branding. As we stated earlier, you can start small with one or two products, learn fast, scale up and become profitable and expand to more products.
- BUILD YOUR BRAND
Your brand should have a touch of your personality, as this is what your business will eventually become. You should then expected that you build a strong brand that should connect with the audience.
Makeup business dwells in the realm of creativity and beauty, so you should be able to build some aesthetic into your brand, as should be represented and seen in your logo and color palette.
Every strong brand has a voice, the question is, with which voice will your brand speak? The voice should be seen in your packaging, social media campaigns and every marketing activities.
- DEVELOP YOUR PRODUCT
By this stage you have got almost everything figured out. You have already got your business model and have also secured funding, it is now time to develop your product.
Now is the time to take a bird’s eye view on size, packaging, colour and texture of your products, as these will be what will represent your brand.
Pay close attention to the materials and ingredients you use when you manufacture your product.
Finally, make sure your product is worth what you plan to charge for it. Overcharging customers will not bring them back.
- TEST YOUR PRODUCTS
We have stated that cosmetics are regulated products, as you would not want to have a product that is very harmful to the skin for instance. So before your products hit the shelves, you should order samples of your products so that you can test them.
Testing them will enable you ensure that they are the quality you expected them to be, in terms of size, colour and texture, as anything short of this will tell that the products are not ready for the market yet. You should check other qualitative measures as well, such as how waterproof the product is, or products durability.
You may have to go through several rounds of testing before you get it right.
- DESIGN A DIGITAL STOREFRONT
Makeup businesses is such that excels in the eCommerce world, so even if you want to sell your products in stores, you should consider setting up an online store. Your makeup business should not just be dependent on the brick and mortal business model, but more so, an eCommerce model (website).
Your website should include a home page, an ‘about us’ page, a contact page and product order page. The order/product pages should be easily searched, sorted and filtered so that your customers can find what they are looking for with ease.
Having a secured website will ensure that your customers’ sensitive information are never compromised. Adding payment features like PayPal or other payment gateways will help enrich the user experience.
You have two options when it comes to building your online storefront. You can either create it yourself, if you have the technical skills, but if not, you should hire a professional to build it for you.
Whether you built it yourself or hired a professional, the end product should fit in perfectly with your brand and the site should offer a seamless user experience for your customers.
- CREATE A MARKETING STRATEGY
Even if we all know that makeup is all about enhancing beauty, and no matter how beautifully created your products are, they will not sell, if they are not marketed effectively.
Here are a few approaches you can take when creating your marketing strategy:
- Paid ads: Run targeted ads on Google ads, Facebook, Twitter and Instagram
- Social media marketing: Create engaging content to build a community of followers who could be potential customers
- Search engine optimisation: Use SEO to target keywords that your potential customers would be searching for.
- Influencer marketing: Hire people with large social media followings to talk about using your products and encouraging their followers to purchase the products.
Your marketing strategy should depend greatly on your target audience.
Your marketing efforts should target specific demographics and you should learn who would benefit most from your products, their specific needs, and work to define what sets you apart from the competition.
A few demographics to consider:
- Actors and actresses
- Local broadcasters
- Cheerleaders and gymnasts
- Makeup artists and consultants
With your identified demographics, go ahead and design your marketing strategy so that it speaks with your target audience. This goes for both messaging and the delivery of the message. Speak to them in a language that resonates with them, and make sure you are delivering the message on a platform that they spend time on.
The marketing plan you developed in your business plan, would have given detailed information about your target audience, and the channels they spend time and money on, you should then target your messages on those channels.
- LAUNCH YOUR PRODUCTS
Since you have gotten everything ready to go, now is time to launch. You should get your followers and supporters excited for the big day and start generating sales.
If you have followed the steps in this guide, hopefully you will have a list of customers waiting at your physical or virtual storefront to pick up your products on launch day.
Every entrepreneurial journey is unique, especially in the cosmetics industry where there are so many ways to go when starting a cosmetics business. However, there are some business practices that are universal. Here are a few tips to get customers and grow your makeup business.
MASTER SOCIAL MEDIA
You have to learn and master social media marketing, especially Instagram, as there are lots of models there, so you can market your products using the channels. You will also find models on Instagram, who are influencers, that will help you market your products, either you can pay them a fee or you can give them product samples. It all depends on the deals you were able to reach with them.
This process will likely look different for you. But studying the process, learning about the journeys of makeup artists and influencers, will help you in creating makeup collections, which will give you some ideas for your own brand strategy.
PRIORITISE CUSTOMER APPRECIATION
Let your customers know you appreciate them in a few ways. Use referral systems and giveaways to send free or discounted products to loyal customers.
These small things show your customers how grateful you are for their loyalty to your cosmetics business.
SEND PUBLIC RELATIONS BOXES
Investing in influencer marketing and sending our public relations (PR) boxes whenever you launch a new collection is a strategy that many successful makeup businesses use.
Seeing all of your new products laid out in an on-brand PR box will really get people excited about your collection. And people will be more likely to buy your products when an influencer they know and trust talks about them.
Many beauty brands create products that are centred on certain consumers with particular shades of skin. They fail to create shades of their products that work for people with other shades of skin, and this usually results in their brands not embracing diversity. So create as many shades of your products as possible for all shades of skin.
We have through this practical guide on how to start a makeup business, distilled and detailed on the information you need for you to start and profit from your business. The key point remains, that without taking action, no amount of pages of guide will make any difference.
Are you the person we can trust that will take action today? So why waste another minute, do it now.
What are your thoughts with regards to this guide on how to start a makeup business and do you have any business idea, you want us to write about? Let us know in the comment section.