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Top 10 Tips For Starting Your Own Cosmetic Business


Last Updated on February 23, 2024 by Kanakkupillai

The cosmetics sector is rapidly expanding. The requirement for all forms of beauty and cosmetics products is steadily expanding among various segments of the population. Luxury and Higher end cosmetics are becoming highly popular among the world’s middle classes, even those in low developed and underdeveloped countries.
The cosmetics sector encompasses a diverse range of enterprises, including anti-aging clinics, beauty salons,aromatherapy, spas, hair salons,cosmetic stores, and even the bridal and other makeup artists. If you’re thinking about starting a cosmetics products-based company, there’s a lot of room for growth if you go about, it the right way and with the right products.
Indian market is one of the biggest markets in the world and with good amount of women population in the country, opening and owning cosmetic company would be good business idea.With most of the men also getting an increase in inclination to take care of their beauty and skin health the market is getting even more bigger and strong with respect to the number of buyers and requirements. This means that the prospect for opening and making a big successful business out of this particular industry, market and consumers is getting high.
This article is discussing the 10 major tips which can be referred to when you are starting your own Cosmetic Business.

  1. Know the Regulations to Comply With

Cosmetic industry, like any other industry, is regulated by various rules and regulations which are implied by the law. FDA is one such regulation which should be adhered to by the business. FDA stands for Food and Drug Administration and in India there are also variouslocalauthorities and local laws which should be complied with by the companies belonging to the cosmetic and beauty industryprior to setting the business or even after setting the business.
Also, it is important that the entity and its management ensure the proper compliance and assurance of the adherence to these laws as it or the products produced and sold should be labelled on the basis of these laws. the ingredients used in the product also should be based on such laws and regulations which otherwise will fetchLegal actions, thereby increasing thelegal cost and affecting the credibility of the entity within the market and the consumers. Hiring expert who are having good knowledge, bothpractical or theoretical, on these rules and regulations would help you deal with such legal issues. Setting up a proper administrative and legal department who can take care and handle such issues therefore should be seen as a primary and vital element while setting up the business.

  1. Set a good Location

Setting a location for your business is a vital element when you are starting a business within the cosmetic industry or any other industry. This applies not only to the geographical or physical place or location of your business, but also the rental or lease or owning of the location of your business.
The geographical location of the business is important as this will determine the ease with which you can attract consumers for buying your product or visiting your store. And even if it is in an online platform, it is important to set the area or limit to which you can deliver the products according to the orders placed and received from the consumers. If you are having a focused niche, it is vital that you ensure the setting of the business location in accordance with the targeted consumers presence in such area.
And in accordance to the fund availability and the expense which can be incurred by the entity it is also important that you are taking the location or space for the business on a rental basis, lease basis or taking it on the basis of ownership, that is already owned by you or any other investor or partner associated with the business. Determining the location of the business, in fact will help you determine the future and the success of your business.

  1. Choose a Niche Existing in the Market

Choose a specialisation in which you have previous expertise either manufacturing or marketing cosmetics. You might be familiar with selling organic makeup, eye care products, mineral cosmetics, special effect makeup,and lip care products, for example.
Concentrate on the cosmetics sector that you are familiar with in order to properly organise and manage your business. Focus on a certain area of cosmetics expertise or passion. In the early days of your business, don’t try to sell or make too many goods at once which might make it difficult to set, manage and grow your business.
As a business, when you are concentrating or focusing on a niche, another advantage or benefit which will be enjoyed by you would be that you can design the brochure, the branding and everything in accordance with the niche or the consumers which you are basically focusing or concentrating on. This will help you get an easy access to this niche and woo or even influence them to buying or even trying your product and becoming a loyal group of consumers.
Choosing an issue will also help you design the products in accordance with the needs of this niche or the consumers belonging to this niche will be requiring and set the prices, and the cost or quality of the products in accordance with the requirements and aspirations of the consumers who are belonging to the niche that you are focusing on. You can also develop, produce and launch new products which are in greatest demand within the niche which will also help you ensure that there will be good turnover of the products helping you earn more revenue and profit.

  1. Set an Online Store

Today with people or the consumers turning to the online or ecommerce portal for completing their purchase requirements entities or organisations are also forced to set a business platform online or make their products availableonline. To reach the consumers and make it easier for them to purchase the product without going or turning to the rival companies and their products.
This is majorly because people are busy on their schedules and does not have much time to physically visit a brick-and-mortar business or a store and buy the products that are required by them. They easily depend on the e commerce platform, make their orders online and get the product delivered at their door step within a matter of days. Ensuring that your business entity is having a digital phase and on online presence is important in the technology and internet driven world. So,
while setting your own business in the cosmetics or the beauty industry, it is desirable that you understand the online and ecommerce platform, set one for your business and provide your consumers with ease and less sophistication which would provide them a way to order online and get it delivered at their doorsteps.

  1. Develop a good Marketing Plan

A marketing plan is a document which helps in planning and outlining a company’s marketing and attempts efforts for a specific time period, generally a year. It labels the period’s promotional, marketing strategy, and advertising attempts and efforts. It will also directyou on how to proceed in a planned manner when selling your items to the general public. Your well-thought-out strategy for costs, pricing, and an effective way to supply your beauty and cosmetics items will guide you as you work to expand your niche market reach.
Having a marketing plan is again very important that it will help you focus your resource and all the elements working for your entity towards a common goal rather than putting them doing their own things. It will get everyone on the same page and help you to streamline the business and your product along with the practices and operations in an efficient and effective manner within the target consumers and the market. As anticipated, this will give you not only the ability to fetch the sales targets as it was forecasted but also increase the revenue and the customer base which would help you increase the earning of a good profit as well.

  1. Generate a Publicity Plan

Along with the quality of the product, publicity is equally important. People or the consumers generally go behind the trends which are running in the market and this trend is set on the basis of the publicity which is provided for the product by the company or the consumers or the market for that matter.
For creating publicity stunts, the entity can utilise theCelebrities or influencers who are currently trending on the social media platforms. Associating with these celebrities and social media influencers will help you get the view and attraction of number of consumers who are looking to them for adopting products in fashion and cosmetic industry as they blindly believe what areadvertised and promoted by them.
Along with this, if your products are having the quality which is assured by these celebrities and social media influencers, you will get a good and a strong consumer base where there will be number of loyal consumers. With the advancement of social media, Internet, and technology driven devices we can say that the consumers are inclined to align themselves with the trends.
Companies also set promotional campaigns where they bundle products and get sales more than they anticipated which again helps them create publicity.

  1. Design a Good Logo

For any business, identity is important and people or the consumers will recognise an entity from its name and the logo which is representing its name and the reputation or the brand identity. So, while we’re setting a business in the cosmetics industry or the beauty industry, it is vital that you have a good and memorable logo which is designed and developed by experts.
This will help you fetch not only business but also brand reputation and credibility that will be remembered and memorised by people. It is only when they remember the name that they will approach your brand when they are buying the products as there are a lot more players in the industry and within the market competing for the same consumers with similar products.
So, you can only get them by creating a difference and launching with a logo and name which will stay close to their heart. The logo should have a unique concept and an extraordinary use of the designing elements like the typeface and colours which will help you draw the attention of your potential and targeted consumers. It is important that you have designer expert who could design or develop a logo that will do justice to your business and the products sold by you.

  1. Raise and Generate the Funds

For any business starting or expanding or running, we would need funds. Generating funds for your cosmetics business is no different. As an entrepreneur you will need the funds for not just setting up the factory or entity but also for procuring the raw materials required for producing the cosmetics, or running and also hiring the Staffs or human resources and acquiring other resources which are important for running the business.
As a first step, you can take funds on loans basis i.e., small loans from your family and friends. On the basis of the. Study and the success ratio of your business and the size you will size of the business you would like to set you can use the funds available on your hand and also approach banks or financial institutions from which you can take loans or funds or on a credit basis.
While generating funds through this loan or credit basis, you will have to ensure the interest rate which is applicable on such funds and the monthly instalments or payments that you will have to make for paying back the same in instalments. This is important as it should be equated with the income generating capacity of the business or the product that you are setting up such that there is no or there is a lower risk applicable. You can also approach persons with similar business interest, or proven business entrepreneurs for funding your business and joining you as a partner or an investor to whom you will be providing a decent return on their investment on the basis of the development and growth of the business.

  1. Test the Products Developed and Produced

Prior to the mass production of your cosmetics or the products developed or designed by your entity, it is important that you take certain samples and provide the same to the people belonging to your neighbourhood, familycircle and friends circle such that they can be tested. And you have to take reviews from these people who have used your samples for getting an idea about how the consumers might feel about your product.
Once you get positive feedback from your consumers or these sample, you can start the mass production of the cosmetics or the product’s designed by your entity. Else you can take the valuable feedback from these samples and make the definite differences or improvement that might help you design a better product which will be accepted by the probable consumers.
If you fail to take such a test of your product, this might lead to a designing, development, production, and launching of product which might not be able to reach the expectations of the consumers in the bigger market. Another benefit of conducting this type of sample test with the sample would be that you will also get an idea or hint about the star product of your product list which should be produced on a mass or higher basis. This is to ensure that this is available in the inventory and are expected to have a higher turnover. This will help you plan the operations and the production of your products according to the expectations of the market.

  1. Take Reviews from Consumers and Improve the Product

Mere designing, developing, producing and launching of the cosmetic products will not do the job and fetch you the revenue or profit that you want. Once the products are being launched the entity and its management should talk with the customers or the consumers and get to know more about their feelings and reviews after using the product. On the basis of receiving these reviews the management can improve the product and increase the features or the content of the product to meet the requirements and desires of the consumers.
Only with this the entity can keep on improving their performance and the product quality which will help them stay with in the market and find or win more consumers. If the company fails to understand their consumers and their needs or feelings about their product the company cannot survive in the market for long and will have to even exit the market or liquidate the business. Taking reviews and staying with the consumers will also help the entity develop new products and embrace the new business opportunities which will get them more consumers and help them expand or even survive in the market or the industry.
Thus, we can now conclude that the cosmetics industry is one good industry to set your business in and earn not only revenue and profit but also consumers. But it is important that good quality is ensured for your products such that you are able to beat the rivals the competition is high or cut-throat.


Kanakkupillai is your reliable partner for every step of your business journey in India. We offer reasonable and expert assistance to ensure legal compliance, covering business registration, tax compliance, accounting and bookkeeping, and intellectual property protection. Let us help you navigate the complex legal and regulatory requirements so you can focus on growing your business. Contact us today to learn more.