Colorful Wigs

How to Start a Wig Business

by

Colorful Wigs.

Main Sections In This Post
Steps To Starting A Wig Business
Point to Consideration
Resources
Knowledge Is Power
Featured Video

With a passion for beauty and an entrepreneurial spirit, starting your own wig business is rewarding. In order to succeed, you need to understand market trends, provide excellent customer service, and build a strong brand.

It involves selecting quality wigs, building a clientele, and managing logistics. This post will review the steps to start your own wig business.

We will also review some points to consider and a collection of resources to use now and when your business is fully operational. We’ll review the steps now. Let’s get started!

Steps to Starting a Wig Business

1. Make Sure Running a Business Is Right for You

Before establishing your own business, find out if entrepreneurship is your calling and if you possess the ideal skills for it. Entrepreneurship is not for everyone. Even though you may have a passion for wigs, operating a wig business may not suit you.

Business Startup Considerations gives you more information:

2. Research

Business Research

You’ll have a high chance of success if you are well-versed in the wig industry.

View detailed information from people in the industry on the link below. You’ll also see how to contact them for guidance or advice.

Also, you will have a first-hand glance at a wig business.

Read An Inside Look Into the Business You Want to Start.

Target Market

Establishing your business to get customers becomes easy if you know your target market.

By knowing your target audience, you can understand what they want or need and thus connect easily with them. This information will come in handy when creating and running advertising campaigns once you open the business.

The article How to Understand Your Target Market provides more information.

3. Setup Considerations

Visualizing the setup type you want for your wig business is essential. Try answering the questions below when creating your vision.

You can adjust your vision throughout your research. But what you need right now is a vision to start with. You can fine-tune it as you progress.

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Ask yourself the following questions:

  • Are you looking to set up a commercially located wig design or retail entity, or a home-based one?
  • How many locations do you aspire to have? One or multiple?
  • What is your operation schedule? Part-time or full-time?
  • Will you be the one managing the entity, or do you plan to hire staff to do that?
  • Does your business have a unique selling point or competitive edge?

4. Selecting the Right Location

Location can make or break your business. A poor one will hinder sales and growth, while a good one will make your entity more successful.

The best area to select is one where the demand for wig design is high, and the market is unsaturated.

Learn more by reading Choosing the Best Location for Your Business.

5. Pick a Business Name

Your business name should be simple to pronounce, easy to remember, catchy, and available. Also, you want a name you can use for your website’s domain name. Remember to choose a name that aligns with your brand identity and target audience. Conducting a thorough trademark search is also essential to ensure the chosen name is available for use.

Below are 20 ideas that can spark your creativity and get you started.

    1. GlamStrands
    2. TressTrends
    3. ManeMakers
    4. WigWhiz
    5. Locks & Co.
    6. HairVibe
    7. WigWonderland
    8. ManeMarvels
    9. TressTreasure
    10. GlamourWigs
    11. StrandStyle
    12. WigFusion
    13. HairCharm
    14. LocksLuxe
    15. WigCouture
    16. StrandSensation
    17. WigMagic
    18. HairEnvy
    19. GlamLocks
    20. ManeMuse

Explore the links below for more:

6. Registering Your Business

Every business needs to operate legally. Doing so starts with selecting the ideal business structure, registering the entity, and seeking the necessary permits.

The business structure you pick will depend on factors like the size of operations and your financial muscle.

The article How to Register Your Business offers more details.

7. Create Your Corporate ID

Corporate IDs comprise a logo, promotional items, business cards, brochures, and stationery. Try creating the business cards and logo first, then add the other elements later.

Remember to keep the design professional so that it is appealing to customers.

Check out A Complete Introduction to Corporate Identity Packages.

8. Exploring  Startup and Operating Cost

Startup Cost:

Estimate the money you need for setup and operations in the first few months. The best way to estimate is by noting down all items you need, research costs, and any other expenses that may appear.

Starting a wig business involves a number of initial expenses. Below is a rough sample list of these startup costs with estimates based on 2023 averages in the United States. Note that actual costs may vary significantly depending on the size and nature of the business, location, and other factors.

  1. Business Plan Development: $500-$2,000. While you can create a business plan yourself, you might consider hiring a professional or using business plan software to help.
  2. Legal Expenses (including business registration, licenses, and permits): $1,000-$3,000.
  3. Inventory: $5,000-$25,000. This includes the cost of purchasing the wigs to sell in your store, and depending on the amount of stock, size, and colors you plan to carry will determine your cost of inventory. With a business model like this, you may want to consider offering samples for your inventory and ordering the wig from your supplier with overnight shipping.
  4. Location Lease: $2,000-$7,000 per month. This will depend on the size and location of the store.
  5. Store Build-Out (fixtures, signage, furniture): $10,000-$50,000.
  6. Equipment and Supplies: $1,000-$5,000. This includes items like wig stands, mannequin heads, cash registers, POS systems, etc.
  7. Website Development: $2,000-$10,000. This can vary widely depending on the complexity of the website.
  8. Marketing and Advertising: $1,000-$5,000 per month. This includes costs for initial and ongoing promotion such as online ads, print ads, social media, etc.
  9. Insurance: $500-$2,000 per year. This would include liability insurance and other types of coverage that a retail business might need.
  10. Utilities: $100-$500 per month. This includes electricity, internet, phone, etc.
  11. Staff Wages: Depends on how many employees you have, their roles, and the local wage rates. For a small business, this might be $2,000-$10,000 per month.
  12. Miscellaneous Expenses: $500-$2,000. This covers any unforeseen costs or additional necessities for the business.

So, a rough estimate of the total startup costs for a wig business might be in the range of $23,600 to $115,500. This does not include ongoing monthly costs such as leases, utilities, wages, and marketing. Remember, these figures are approximate and can vary significantly based on many factors.

Explore the posts below for more information:

Operating Costs:

Below is a sample list of monthly expenses for a wig business. Please remember that these are general figures, and actual costs can greatly vary depending on factors like location, size of the business, quality of products, and specific business strategies.

  1. Rent: $2000 – This can vary greatly depending on the location of the shop. Prime locations will have higher rent.
  2. Utilities: $300 includes electricity, water, heating, and internet services.
  3. Salaries/Wages: $5000 – This is assuming you have a few employees.
  4. Equipment and Maintenance: $500 – Includes the cost of fixtures, displays, cleaning supplies, and any necessary maintenance.
  5. Insurance: $200 – The cost of insurance will depend on your provider, but it’s an important aspect of protecting your business.
  6. Marketing and Advertising: $1000 – This is crucial for attracting customers to your business and includes costs for creating and distributing ads, maintaining a website, and managing social media accounts.
  7. Professional services: $500 includes fees for accountants, lawyers, or consultants.
  8. Licenses and Permits: $100 – This average figure could be higher or lower depending on your local requirements.
  9. Shipping and Delivery Costs: $300 – There will be shipping costs if you ship products to customers or order inventory from afar.
  10. Miscellaneous Expenses: $200 – For any unexpected costs that may arise.

The total monthly expenses in this sample list would be $10,100. It’s always important to overestimate a bit in case of unexpected costs. Plus, this doesn’t include the cost of starting the business, such as the cost of renovating your space, buying initial equipment, or purchasing your opening inventory.

Equipment:

Wig businesses sell various styles of wigs, hair extensions, and related products. Here are some equipment and supplies you will need to start a wig business:

    1. Wigs: This is your primary product. You’ll need a variety of wigs in different styles, lengths, colors, and materials (synthetic and human hair).
    2. Hair Extensions: In addition to full wigs, you might also want to offer hair extensions, which are popular for adding length and volume to natural hair.
    3. Wig Stands: These are essential for displaying wigs in your store. Customers like to see what they’re buying, and well-displayed wigs will attract more attention.
    4. Mannequin Heads: These are useful for displaying wigs and making them look as realistic as possible.
    5. Wig Caps: Wig caps are worn under the wig to protect the natural hair and keep the wig secure.
    6. Wig Brushes and Combs: These special brushes and combs are designed to prevent damage to wigs.
    7. Wig Care Products: This might include special shampoos, conditioners, and styling products designed for synthetic and human hair wigs.
    8. Styling Tools: You might need various hair styling tools, like curling irons, flat irons, and hair dryers that can be used on wigs.
    9. Hair Clips and Accessories: These are useful for styling and personalizing wigs.
    10. Wig Adhesives: Some customers may need special adhesives to help secure their wigs.
    11. Storage Boxes or Bags: These are useful for customers to store their wigs when not in use.
    12. Measurement Tools: You’ll need measurement tapes to help customers find the right wig size.
    13. Lighting Equipment: Good lighting is essential for customers to accurately see the color and style of the wigs.
    14. Mirrors: Customers will need mirrors to see how the wigs look on them.
    15. POS System: A point-of-sale system for handling sales transactions, returns, and inventory management.
    16. Packaging Supplies: This includes bags, boxes, and tissue paper for packaging wigs for your customers.
    17. Cleaning Supplies: You’ll need supplies to keep your store clean and hygienic.
    18. Office Equipment: This includes items like computers, printers, phones, and other office supplies you may need to handle orders, customer service, and other business tasks.

Remember, the specific needs may vary depending on whether you are opening a physical store, an online store, or both.

New and better equipment can help increase productivity and save time in operations. Check out up-to-date search results for Wig Design Equipment. 
As a rule, search for high-quality yet affordable supplies that will not affect product quality. Here is a link to search results for Wig Design Supplies.

9. Write a Business Plan

Create a business plan to understand your business and track your progress. This document will also come in handy when seeking investors and lenders.

The following is a comprehensive guide on How to Write a Business Plan.

A Sample Business Plan for a Wig Business

I. Executive Summary

Name of Business: Wigs Unlimited

Purpose of Business: Wigs Unlimited aims to provide high-quality, customizable wigs for individuals suffering from hair loss, those undergoing medical treatments, fashion enthusiasts, and professionals in the entertainment industry.

Vision: To become a leading wig manufacturer and supplier in the global beauty industry, known for our product quality, customization capabilities, and excellent customer service.

Location: Online (global) and physical storefront in New York City, USA

II. Company Description

Legal Structure: Wigs Unlimited is a Limited Liability Company (LLC)

Owners: Jane Doe, a licensed cosmetologist with over 10 years of experience in the beauty industry, and John Doe, a business professional with a background in entrepreneurship and e-commerce.

III. Products and Services

Wigs Unlimited will offer a wide variety of products and services:

    • Ready-to-wear synthetic and human hair wigs in various styles and colors
    • Custom-made wigs tailored to the client’s specifications
    • Wig maintenance and repair services
    • Wig accessories like stands, caps, and combs

IV. Market Analysis

Industry Overview: The global wig and hair extension market is expected to grow significantly in the coming years, driven by increasing fashion consciousness, growing disposable income, and increasing demand from the entertainment industry.

Target Market: Our primary target markets are individuals experiencing hair loss, cancer patients, fashion enthusiasts, and professionals in the entertainment industry.

Competitor Analysis: Our main competitors have established wig manufacturers and retailers. We plan to differentiate ourselves through our customization services and focus on an excellent customer experience.

V. Marketing and Sales Strategy

Marketing: We will leverage social media platforms, SEO optimization, collaborations with influencers, and targeted ad campaigns. We will also attend industry trade shows and events.

Sales Strategy: We will offer products online for global reach and in our physical store in NYC. We will focus on customer service, providing consultations to help customers choose or design the perfect wig.

VI. Operational Plan

Our operations will revolve around wig manufacturing, order fulfillment, and customer service. We will source high-quality synthetic and human hair from reliable suppliers. Custom orders will be created in-house, while standard wigs will be produced both in-house and outsourced to trusted manufacturers.

VII. Management and Organization

The business will be managed by the owners, Jane and John Doe, with Jane overseeing product development and quality control and John handling business operations and marketing. We will hire additional production, sales, and customer service staff as the business grows.

VIII. Financial Projections

Our startup costs will include the cost of initial inventory, website development, setting up our physical store, and marketing expenses. We expect to reach break-even in the second year and start making a profit by the third year. Detailed financial projections and cash flow statements will be provided separately.

IX. Funding Request

We are seeking $150,000 in startup funding, which will be used for initial inventory purchase, setting up the physical store, and marketing activities. In return, we offer a 10% equity stake in Wigs Unlimited.

X. Exit Strategy

In case of a necessary exit, the business may be sold to a larger beauty company or a private investor interested in the hair and beauty industry.

This business plan offers a solid foundation for Wigs Unlimited. Our next steps include securing funding, finalizing our product range, and starting our marketing activities. We are excited about the potential of Wigs Unlimited and look forward to its successful launch.

10. Set Up Your Banking

You want your business finances to be separate from your personal. Do this by setting up a business checking account. Consider also opening a merchant account if your business accepts credit and debit cards.

To learn more about business banking, explore the articles below:

11. Get Capital for Your Operations

Obtaining a loan may be difficult since most lenders consider startups high-risk.

Successful and already established entities have a better chance of getting a loan than startups.

This is not to say your chances of getting a business loan are nil. Some lenders may approve your request if you approach them with a good business plan and collateral.

Below is a sample list of documents that may be required when applying for a business loan for a wig business:

  1. Business Plan: A comprehensive document outlining your business goals, marketing strategies, financial projections, and the overall viability of your wig business.
  2. Personal Identification: A valid government-issued identification document (such as a passport or driver’s license) for all business owners or partners involved in the loan application.
  3. Business Registration Documents: Proof of business registration, such as a certificate of incorporation, partnership agreement, or articles of organization, depending on your business structure.
  4. Financial Statements: Financial statements for your wig business, including profit and loss statements, balance sheets, and cash flow statements. These documents should provide a clear picture of your business’s financial performance.
  5. Tax Returns: Personal and business tax returns for the past two to three years, including both federal and state returns.
  6. Bank Statements: Recent bank statements for your business accounts, typically covering the last three to six months. This helps the lender assess your business’s cash flow and financial stability.
  7. Collateral Documentation: If you plan to provide collateral for the loan, such as equipment, inventory, or property, you’ll need to provide relevant documentation to establish ownership and value.
  8. Business Licenses and Permits: Any required licenses or permits specific to the wig industry or your location. This ensures your business operates legally and complies with local regulations.
  9. Industry and Market Research: Supporting documents that demonstrate your understanding of the wig industry, including market research, competitor analysis, and industry trends.
  10. Resumes: Resumes of key team members involved in the wig business, highlighting their experience, skills, and relevant qualifications.
  11. Credit History: Personal and business credit reports to assess your creditworthiness. This includes providing authorization for the lender to check your credit history.
  12. Debt Obligations: A list of existing debts and obligations, such as loans or credit lines, to give the lender a complete picture of your financial responsibilities.

Please note that this list is a general guide, and the specific documents required may vary depending on the lender’s policies and the nature of your business. It’s always a good idea to consult with the lender or financial institution directly to confirm the exact documentation needed for your business loan application.

For more information, read Getting a Small Business Loan.

12. Software Setup

Consider setting up software to help you organize and efficiently operate your business. You can check out software options on the links below.

Read customer reviews to see what others think of the ones you’re considering.

13. Get the Right Business Insurance

Obtain the right insurance coverage before beginning business operations to protect your employees, assets, and customers.

Consulting a competent insurance broker is a great way to guarantee you get the right insurance.

The following articles will provide more information on business insurance:

14. Select Suppliers

The right supplier helps your operations occur seamlessly.

The wrong supplier hampers operations. Choose one you can rely on and can build a professional relationship with.

Explore How to Choose a Supplier for more tips.

15. Physical Setup

In this stage, emphasize your layout. You want your operations organized to enable you and your team to easily store, locate and retrieve things.

Aim for an attractive layout that presents your business in the best light to customers.

You also want to have an appealing office layout since this is where you will manage your business. You need an organized office that is fully equipped.

This step is also your cue to place business signage to show customers you are open for business.

Check out the following posts:

16. Creating a Website

Create a website to communicate with customers and market your entity online. The best websites are fast, mobile-friendly, and have a design appealing to users.

When creating your website, you’ll also need to apply for a domain name and get hosting from a dependable provider. This way, you’ll get total control over your site.

Explore the following articles for more:

17. Create an External Support Team

Your external support team is the people you bring to your business for professional advice or consultancy.

It can take months, at times years, to build this team, but you don’t need to gather the whole team to begin using their services. Start with the ones you have.

Note down the experts you want on your team and set up a meeting with them.

Your support team can include a financial advisor, banker, IT expert, marketing guru, lawyer, and financial expert.

Read Building a Team of Professional Advisors.

18. Hiring Employees

When ready to get employees, avoid hiring more than necessary. Having excess staff increases your operation costs. It also affects your bottom line.

Ensure you hire the right person for each available post. Hiring mistakes are costly since they lead to lost productivity, time, and money, and you’ll have to start the hiring process again once you learn the person you hired was not the right fit.

Explore the following articles for more information:

Points to Consider

Business Model

Whether people need a wig because they lost their hair, want a different look that they can gain instantaneously, or want a change in color without dying their own hair, then a wig is a choice open to them.

This type of business has low competition, and it’s one you may be able to operate part-time if you wish. If you plan to locate in a busy city, your chances of gaining more customers increase.

If you are located in a rural area, then you may not see a lot of customers. Although, you could take your business online and ship wigs to customers rather than have a physical storefront.

With this type of business, you’ll need to carry a variety of sizes and colors. 

Keep in mind there are a variety of materials, such as synthetic hair as well as real hair from people and animals. Synthetic is cheaper than human hair and would be easier to obtain.

You may be better off ordering your wigs as needed because if you consider one style in different sizes and different colors, you could have 30 variations of that style.

Multiply that by an average of $170. You could be looking at over $5,000 to stock one wig style. Multiply that by 50 styles, and you’re looking at over a quarter of a million dollars just for inventory.

You may also consider creating a blog all about wigs and joining an affiliate program where you refer people to other sites that offer wigs for sale.

Any sale made through your affiliate link will earn you a commission. This way, you don’t worry about a storefront, inventory shipping, or returns. You just focus on creating web content and giving advice, then sending people to the right sites for the right wig.

Marketing

Marketing is always underway in any business. Entrepreneurs are always on top of it. Focus on the marketing types and strategies that will help bring customers to your business.

Simple marketing tactics like issuing business cards are great for creating awareness. Therefore, always carry copies of business cards with you to hand out when an opportunity arises.

A critical key to gaining any success in this type of business is to focus strongly on targeting the right people.

Once you have your target customer, you can concentrate on marketing your wigs to them. Once you understand your customer base, you start to develop creative ideas on how to serve them better.

For example, an idea off the top of my head, you may come up with a subscription-based model and create a look of the month club, where you rent out wigs for one month at a time.

The wigs are washed and sanitized after they are returned. They could even have an inner liner that’s replaced after each rental.

Our marketing section has more tips and ideas to help you find creative ways to market your business.

Also, read our post How to Get Customers Through the Door.

Profit

No business has similar operating costs and expenses. Therefore, no individual can accurately tell you how much you will make. You can, however, estimate your profit margin per sale.

To calculate net profit, deduct total expenses from gross revenue. Do this calculation after the month or year ends.

Keep your costs low enough without affecting your team’s productivity and product quality.

Check out Factors Affecting Business Profit.

Pricing

Pricing your products too high could make you lose business. Setting them too low, by contrast, can make customers doubt your operations.

Choose a price within the market rate. If you prefer having higher prices, increase value, too.

Click the following links for more information:

Challenges

No industry is void of challenges. Learn the ones that affect your industry to help you prepare to face them.

The link below provides more information on the challenges you may encounter in your business.

See Wig Business Challenges.

Resources

This section provides resources where you can find more information on the wig industry. Most of the links highlighted will lead you to up-to-date search results.

Trends and Statistics

Trends and statistics are great resources for gathering information on your industry’s performance.

You get to see whether your industry has risen or declined in popularity.

For the latest information, see Wig Design Trends and Statistics.

Top Wig Businesses

Looking at the top wig businesses lets you know who you will compete against. You may also find similarities or discover an idea unexplored in your industry.

See Top Wig Businesses.

The Future of the Wig Industry

When you learn about the future developments that may occur in your industry, you put yourself in a position to prepare for them. You never know – these enhancements might be your competitive edge.

Check out The Future of the Wig Industry.

Professional Wig Design Tips

It’s advisable to search for wig design tips regardless of your expertise in this industry. It doesn’t matter your experience level. You can refresh your knowledge and skill.

Also, check out published tips since some customers might know and enquire about them. Knowing these tips will also enable you to discredit them or give a varying perspective.

See the latest search results for Professional Wig Design Tips.

Terminology

Every business owner needs to know their industry’s terminology. You don’t need to know them in one go. You will eventually learn as you progress.

Check out the search result link below. It highlights glossaries and terminologies in your industry.

See Wig Industry Terminology.

A Day in the Life

Chances are, other entrepreneurs started wig businesses before you. You can learn about their experiences by reading “A Day in the Life” posts.

Your experience may differ from theirs, but you’ll learn something new.

For more information, see search results for A Day in the Life of a Wig Business Owner.

Businesses for Sale

Search to see if there are any wig businesses listed for sale. When you buy an already established business, you have a head start since the entity has an established customer base.

This means you can start operations from the moment you assume control.

The article Buy a Business or Build One gives more information on this topic. You can also explore the latest search results for Wig Businesses Listed for Sale.

Franchise Opportunities

As you check out businesses for sale, consider also looking at franchising opportunities. You may find a good one that comes with brand marketing and a working business model.

Owning and operating a franchise has its benefits and drawbacks. See the article What to Know About Owning a Franchise.

You can also explore the latest search results for franchise opportunities for hair and wig businesses.

Knowledge Is Power When You Use It!

Plenty of information is available on the wig industry. You can decide whether to use it or not. Check out the sources below.

Forums

Forums are great sources to get insights into people’s thoughts and opinions about your industry. You get to learn a thing or two as you contribute.

See up-to-date search results on Top Wig Industry Forums.

Courses

Courses provide you with more information about your industry. You can learn through self-study courses or enroll in a local educational institution.

Blogs

Another way to acquire more knowledge is by subscribing to authority blogs related to your industry. Once the information is sent to your email, you can unsubscribe from those offering little to no value. Doing so will leave you with those giving valuable information.

Books

If you are a voracious reader, you may enjoy reading books on wig design. You don’t have to read them from the first page to the last.

You can check the table of contents and jump to the chapters offering the knowledge you need.

News

Sites such as Google News feature the latest media stories on your industry.

Adding a notification alert is one way to ensure you know when a news story or post gets published.

Featured Video

YouTube is another excellent resource for learning about your industry. It is fast and contains endless videos and tutorials.

YouTube also offers suggestions related to what you are watching. Check out the links below for videos on your industry.