The cosmetics industry is worth billions of dollars a year. And the figures can only grow bigger. Before now it used to be a dominated by multinationals and global brands. But today many independent and artisan cosmetic companies are also doing well as market players.
Do you have a strong wish to own your own cosmetics retail store? You can achieve it, even if you are not a makeup artist or savvy professional. All you need is time, effort, commitment, right information, and planning.
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 start small and make it big. Read on to learn the steps involved in starting a successful cosmetics retail store.
Starting a Cosmetics Retail Boutique – Sample Business Plan Template
1. Decide what brands to sell-: When starting a retail cosmetic store, you need to figure out what exactly you want to sell. You sure cannot sell every brand under the sun, so you need to choose carefully based on demand in your locality and other criteria.
Remember that many of the major brands have very large minimum orders or exclusive agreements that may limit you, so check out for these first. For example, some brands sell their products only in their own stores or in selected authorized dealers, so you can’t sell such products unless you buy from deals with excess supplies. And 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 each 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 just won’t be able to sell some, no matter what.
2. Create a business plan-: As with most other businesses, starting a successful cosmetics retail store requires adequate planning. And the best way to ensure this is to write a detailed business plan. Your cosmetics store business plan will include the mission and objectives of your store, your target market, startup cost estimates, financial projections, competition analysis, marketing plan, plans for expansion, and so on.
Your business plan will play two major roles. First, it will serve as your step-by-step guide towards launching your business successfully and running it effectively afterwards. Second, it will come in handy when you need to present your business to third party funders, such as investors and loan issuers.
3. Register your business and complete other necessary paperwork-: Visit your local business registration office to register the name of your business. Choose a name that is short and easy to remember, and that reflects what your business is all about. It is recommended that you register your business as an LLC, as this will protect your personal assets. But if you are unable to do that, you can register as a sole proprietorship.
In addition, you should contact the appropriate local agency to find out the licensing requirements for starting a retail cosmetics store in your state or country. Typically, you will need to obtain licenses, business permits, tax ID, and trademarks, as needed. If you will be employing other people to work with you, you will also need to get an employer ID. Aside that these are proofs that that your business is state-approved, they are also necessary for obtaining wholesale discounts, bank accounts, and mark protection.
4. Choose a location and acquire property-: Since the success of your business hinges largely on its location, you need to 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 also be high traffic area and one that is easy to get, too. And it must have lots of parking space. Once you have found a good property within a suitable location, buy it or lease it, depending on how much funds you have.
5. Set up your store-: Design the inside of your store to suit your target market. Are you selling to younger people or more 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, so avoid materials that are difficult to disinfect and maintain.
6. Hire employees-: You will most likely need to hire employees to work with you. Their number depends on how big your store will be and other factors. Regardless of how many people you are hiring, ensure that are highly experienced and skilled in their respective positions.
7. Market your business and start operations-: After you have stocked your store with products, your next step is to start advertising it. No one will know your business exists if you don’t market it aggressively, especially when you are just starting. So, adopt multiple advertising techniques: free and paid, online and offline, direct and 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.
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