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Are you interested in starting a successful business in the beauty sector but are unsure of where to begin? Following the challenging Covid-19 years, the beauty market experienced a significant uptick in 2022, and by 2026, it is predicted to have reached a value of about $130 billion. So, saying that starting a beauty supply store can be profitable might even be an understatement.
However, proper planning and execution are required to ensure that you can keep up with thousands of competitors. This guide will show you how to open a beauty supply store and profit from it, taking you through each step of the process and providing relevant examples and ideas.
A beauty supply store is a type of business that sells cosmetics and personal care items like hair, nail, and skincare products, makeup, and different accessories.
If that’s what you are planning to do, let's go through the exact process you will need to handle to start a beauty supply store as your own business.
Before you take any steps toward opening a beauty supply store, you should do a lot of research on the market. This means looking at the different niches and brands in the industry, figuring out who your target audience is, and figuring out how your competitors stack up. This will give you the information you need to make good decisions and get rid of many risks, like choosing the wrong positioning, pricing, or locations.
Here’s exactly what you will need to do:
For a beauty supply store, this means learning about your future customers and gathering all the necessary information, such as their ages, genders, income levels, cultures, personal habits, and preferences, in order to understand what beauty products they might be looking for.
For example, young professionals in an urban area might be looking for high-end and innovative beauty products, as well as men's grooming products. If the target audience is older individuals in rural areas, they might be more interested in traditional and familiar products with a focus on affordability and value.
Choosing a niche will help you stand out, focus your efforts, compete more effectively, and increase your business’s profitability.
To make it work, your niche choice should be aligned with your choice of beauty brand, as well as your own policies and company values. For example, a store that specializes in luxury organic products will have different policies and values compared to another store that specializes in cheap and affordable products.
To do that, you can check out existing beauty supply store websites and web reviews, visit their physical stores, or both. You can go even further and make purchases to see the whole process. All of this will help you figure out what other companies on the market do well and what they could do better, find untapped markets, and improve your strategy and positioning.
For example, you may find out that two stores in the area provide a wide variety of cheap and middle-priced products, but none focus on expensive luxury brands. If there’s a match with your existing target audience, it might be a nice potential niche to fill in.
For example, if you specialize in organic skin care products, something like "Organic Oasis" or “Naturals Beauty” would be a good fit. Likewise, “Hair Haven” or “Lush Locks” would go well for a store that offers a variety of hair care products.
After you have performed all the research, summarize your findings. Write down your niche, name, and insights after your target audience and competitive research.
It may appear that spending several months creating a large pile of documentation is necessary, but business planning is more than just endless pages of information. It’s more about thinking through your business idea and how it will be implemented.
In fact, a business plan doesn't even have to be a lengthy white paper. It can be a simple presentation that answers all the core questions in concise sections, such as:
As a result, you will have a comprehensive understanding of what your business is going to be about, how you will promote it, and how it is going to pay off. It will not only give you a better understanding of the next steps but also help you increase your chances of success.
Depending on the state where you are going to register your business, you may need licensing and permits before starting any professional activity, such as
You can go to your local SBA (Small Business Administration) office and the Department of Revenue in your state to find out at which agencies you need to apply for the permits and licenses.
After you have your license, but before you finalize the documents, you should choose the location of your business.
The choice of location may totally make it or break it, and it’s not only about visibility (which can be partly fixed by pointers, signboards, or online geo-targeting). It’s also important to match your location with:
For example, if you specialize in luxury beauty products, you may want to open your store in an upscale neighborhood. If you offer budget-friendly supplies, look for a location in a more affordable area with high foot traffic.
This diagram made by Public Spaces gives an overview of all the important parameters for a location, and they are also pretty relevant for any other kind of business.
Now that all the prep is done, let’s get closer to the point. Several types of legal structures are typically applicable to a beauty supply store business:
You can read about all the other types of business entities on the U.S. Small Business Administration website.
To actually register your beauty supply store business, you can do everything on your own or hire a lawyer. Let’s quickly go through both options with their main pros and cons:
For instance, lawyers are aware of the due dates for submitting different forms and finishing the registration process's steps. Without their assistance, you may run into additional fees and legal consequences. Another frequent occurrence is when a business registers under a name that is already protected by a trademark owned by another business, which may result in a legal dispute and possible fines.
If you co-own a business, it’s even more important to use professional legal support to avoid future conflicts that may turn into huge losses and negative experiences.
On the other hand, it’s not only much more expensive to hire a lawyer; often, it also means a certain level of dependence on the lawyer. Once the business is registered, you may still need a lawyer for legal advice and representation, which can be costly.
So, there’s no simple answer to whether you should choose a lawyer or not. It depends on your own legal expertise, the time you possess, and, of course, your available budget.
Now, let's talk about how to start a beauty supply business officially. Here is the registration scheme, including both general and specific steps that depend on the exact business structure:
After you finish these steps, your business will be officially registered and ready to go.
If you are a sole proprietorship and will work entirely on your own, you can use your Social Security number to open the bank account, but it will be harder to separate business and personal finances and track your business’s cash flow. For all other legal structures, it’s required to open a business bank account.
In general, opening a business account is not much different from opening a personal one. The only difference is that you might need to show more paperwork, like proof that your business was set up or licenses.
You can do it at any bank, but it’s always better to choose one with a convenient location, good services (online and mobile banking, merchant services, etc.), and low fees while avoiding other conditions that might cause a hassle, such as minimum deposit amounts or credit checks.
Business insurance is not always required by law, but it is highly recommended for any type of business, including a beauty supply store. It can protect the business and its owners from fines. There are several types of insurance policies you can apply for at beauty stores:
When choosing a business insurance provider, consider their policies and coverage options, prices, claim processes, and customer reviews to make sure you will get what you expect rather than another legal issue.
After you are done with all the boring strategic and legal matters, it’s time to turn your attention to the various types of products and equipment you will need. So, what will you fill your beauty supply store with?
You are almost all set, but there are still a few more important things to set up.
Even a small business may plunge into chaos if it tries to manage all of its supplies manually. If you don't have good inventory management, you'll have shortages, products that have gone bad, and all sorts of other problems.
You need to know all of your stock and quantities. You need to know if something is about to end or expire. Instead of manually checking every position, you should ideally receive automatic notifications when it's time to buy something. You need to order the required products as easily as possible.
This is where Suplery will come in handy to maneuver through all of these issues and tasks at once. Suplery is an online platform designed specifically for beauty businesses, where you can:
Suplery simplifies inventory list management and allows you to manage all of your inventory on a single easy-to-use platform.
It’s finally time to hire the all-star team that will be the heart of your business.
First of all, think about the exact positions you will need to fill. You will probably need a store manager, sales associates, a cashier, an inventory specialist, and a customer service representative. In addition, you might want an accountant, beauty advisor, marketer, HR manager, or other professionals relevant to your specific store.
Calculate how many hours each of them will need to work to ensure there is no overload or free time that you will have to pay for. When you open, try to hire only the necessary staff.
A classic hiring process includes:
It’s very useful to have written criteria for every position and make notes after every interview. In this way, you’ll be able to compare candidates objectively and not miss important details.
When you handle interviews, consider not only their experience and skills but also their certificates, customer service attitude, and cultural fit. Your team members should align with the concept of your beauty supply store and share your values.
Along with the hiring process, it’s also time to give the right spirit to your beauty supply store. Its interior and exterior should both align with your niche and target audience and help customers remember this exact store in a good way.
Here are some tips on how you can achieve all that:
Let your customers feel comfortable in your space and find what they need easily.
Ideally, you should start thinking about marketing at the very first stage, when you perform your research. Who is your target audience? How can you appeal to their needs? How will you set your store apart from the competition? All of these inquiries have a direct bearing on marketing, so you ought to have given them some thought.
When you're almost ready to open up, you'll need a specific action plan so you can start acting right away and don't get off to a shaky start. Instead, you’ll attract a steady stream of customers from the very beginning.
Here’s how you can do it:
Additionally, it's a good idea to establish an opening event with a festive and welcoming atmosphere to help set the tone for your business and make customers feel welcome.
However, all of these efforts will be for nothing if you don't have a plan in place to effectively reach and attract potential customers. That's why it's important to start implementing a marketing strategy early on, even before your business is officially open.
The exact cost of opening a beauty supply store will depend on a number of things, such as your location, the size of your store, the products you choose to sell, your marketing budget, the level of expertise of your employees, and so on.
As a rough estimate, you should plan on spending around $50,000 to $60,000 for the first three months of the operation. The total cost may reach $200,000 or more if you hire a lawyer and top-level staff, create a luxurious interior, etc.
This money will mostly be spent on registrations, rent, decorations, employee salaries, and the products you will be selling.
While this may seem like a significant investment upfront, a well-run beauty supply store has the potential to bring in more than this amount in annual profits. In other words, the effort and investment you put in at the beginning will be well worth it in the long run.
So, is it possible to open a beauty supply store with no money? Unfortunately, the answer is no, because you will at least need to buy the products you are going to resell and pay rent.
But don't worry! There are a few ways you can try to cut costs. For example:
If it’s still over your budget, try negotiating trade credit with your suppliers or using installment payments to ease the burden on your cash flow.
If those options don't work, you could look into financing options, like bank loans or government grants, to help you get the necessary funds for your inventory.
Don't give up! With a little effort and creativity, you might be able to make it happen.
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If you take the time to get ready, opening a beauty supply store can be a profitable and fun way to start a business.
First and foremost, you need to find out who your target audience is and where your store should be. You'll also need to get all the licenses and fill out any paperwork that's needed. Once you have everything in place, it's time to start ordering products for your store.
But where do you even begin? With so many beauty suppliers out there, it can be overwhelming to try and find the best ones. That's where Suplery comes in. They make it easy to connect with top beauty suppliers, so you can get the products you need to stock your store and start selling.
Remember, starting a beauty supply store takes time and effort, but with the right preparation and resources, you can turn your dream into reality. Get started today and take the first step towards building a successful business.
What is the step-by-step process of opening a beauty supply store?
Opening a beauty supply store includes the following steps:
How much does it cost to start a beauty supply store?
The cost of starting a beauty supply store can range from $50,000 to $200,000 or more, depending on factors such as the location, size of the store, inventory, and marketing expenses. Costs can vary widely based on the specific business model, so it's important to do thorough research and budget planning before starting a beauty supply store.
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