How to Start a Beauty Supply Business

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Image of makeup

How to Start a Beauty Supply Business

Overview:

Some of the oldest products made and sold all over the world revolve around beauty.

Beauty supplies and products are as old as Cleopatra and the return to natural products continues to increase for many reasons: allergies and opposition to animal testing being two.

While highly competitive, the beauty industry continues to flourish in various sectors and all over the world. Thus, the industry grows as well.

There are basically four types of beauty supply:

  1. Franchise home sales: such as Mary Kay, Avon, etc.
  2. Retail store franchises: such as Sally’s
  3. Manufacture and sale of your own product line to retail outlets
  4. Sale of imported beauty products online and offline

The two keys to a success are a passion for beauty products and finding a niche that fills a particular need or demand.

Skill Set:
  • Cosmetology
  • Biology
  • Knowledge of chemicals as well as herbs and botanicals
  • Marketing and promotion
  • Applied sciences such as reactions of combined chemical or natural bases
  • Inventory management skills
  • Sales and marketing to retail outlets
  • Advertising
  • Labeling and packaging of products
  • Taking and delivering of orders
  • Strong customer service skills
  • Checking store displays, making sure stock is sufficient in retail outlets
  • List of Common Business Skills
Employee & Job Consideration During The Start-Up Phase Or In The Future:
Approximate Daily Hours Needed:

If you have a brick and mortar establishment, your hours will generally be retailer’s hours of 10 a.m. to 6 p.m. If you are an affiliate or home party franchise, your hours will vary according to schedule.

Hours to prepare depends on the distribution method you are using, but overall you will be spending a minimum of an hour to prepare and set up for opening or showing products. Plan to spend the same amount or more to close, do inventory, and submit orders.

Equipment, Supplies, & Services During Start-up OR In The Future:
Monthly Expenses To Consider:

List of Common Monthly Expenses

Licenses:

There are many recipes for creating your own cosmetics but make sure your products pass FDA approval. This is a safety issue and one that you will want to be fully aware of to avoid costly lawsuits.

If you are starting your own line of products, bear in mind:

The U.S. Food and Drug Administration (FDA) which regulates cosmetics in the United States defines cosmetics as: “intended to be applied to the human body for cleansing, beautifying, promoting attractiveness, or altering the appearance without affecting the body’s structure or functions.” This broad definition includes, as well, any material intended for use as a component of a cosmetic product.

The FDA specifically excludes soap from this category.

In addition, the FDA requires strict adherence to the labeling of all ingredients in beauty products.

If you are a distributor of beauty supplies, you can expect to have an agreement with the supplier, including franchises. Some suppliers and importers will not sell products made by people who do not have cosmetology licensing.

If you are a home based distributor, you will not need licensing as the company you work with has the licensing, conforms with the law, and will give you a distributor’s agreement.

To make a brick and mortar business legitimate, you will need a business license and tax ID number along with any zoning and other retail permits.

See Our Page On Licenses and Permit

Approximate Minimum Startup Cost:

Bare essential – If the business is home-based, you can expect to pay under $500 to start selling and making commissions. On the other end of the spectrum, a brick and mortar store will cost about $2,500 to $5,000 for the initial overhead, licensing, and products.

Special Requirements for This Business:
  • You may need additional licensing, depending on your niche and whether you are applying beauty products on a customer’s hair, nails, or skin.
  • Ongoing beauty courses for you and your staff.
  • Conscious of FDA approvals and bans of certain chemicals and other bases in beauty products.
  • Renewal of specific licensing and permits.
Pros and Cons:

The Pros:

  • Easy to start
  • You have the advantage of being your own boss and setting your own hours
  • You get to work with many different kinds of people
  • You may get to travel
  • Expandable
  • Can be highly lucrative

The Cons:

  • At risk of customer complaints; especially in case of allergic reactions to products
  • At risk of lawsuits as a result of consumer complaints
  • Depending on the services you provide, you may have to handle toxic substances
  • Highly competitive
  • The cheapest wholesalers may carry products that are not FDA-approved or contain chemicals that cause adverse reactions.
Type of Customers You Need to Attract:

The target market of the is varied and wide for both men and women.

Once you decide on your niche, you will be able to determine if you need a storefront or website or will appeal one-on-one in home settings.

You can concentrate on a specialty such as luxury/spa, new/trendy, and hard-to-find products that will appeal to a specific group or age-range.

Statistics:

To see specific data and statistics on the many facets of the industry, please see Valuation Resources

Resources:

Wholesale:

Wholesale Health & Beauty

Jinny

Marlo Beauty

TM Trading

Courses:

Beauty Schools Directory

Franchises:

Franchisesales.com

Associations:

Pro Beauty
Black Beauty Association

Books:

The Business of Beauty

Beauty Imagined: A History of the Global Beauty Business

Other:

Skin Deep: The Business of Beauty DVD