Welcome to the beauty business! It’s one of the best industries to be in (no bias, of course), so you’ve made the right decision.
While working in this industry can include amazing perks, be immensely rewarding and come with some memorable experiences, making it can be tough, competitive and exhausting.
Like starting any new business, there is a multitude of things to consider. Product to market fit, investor backing, marketing strategy, cash flow…If you’re having trouble trying to figure out where to start, believe us, you’re not the only one!
To give you a bit more direction, the team at Professional Beauty have put together a list of the top 5 things you need to consider before starting a beauty business. We’ve also sat down with two beauty business experts – Anna Ross of Kester Black and Victoria Curtis of Curtis Collection – to get their first-hand experience on how be successful in the industry.
What’s going to set your business apart from the rest? There’s always room for a new salon and shelf space for a skincare line, but that doesn’t guarantee success. “Be original,” says Kester Black Founder Anna Ross. “Australia is a very small country and plagiarism is very obvious.” Established in 2012, Kester Black is now one of Australia’s leading manicure and skincare brands. Their point of difference is their water-permeable nail polishes that are breathable, high-shine and ethically sourced and made.
“Kester Black is the result of continual innovation, a tireless approach to ethical manufacturing, and a passion for creating a positive impact on the community and environment,” Anna tells us. “These company attributes make me very proud of the work we do. We have recently received external recognition of this by becoming the first cosmetics company in the world to attain the prestigious B Corp certification.”
2. Type of business
Will you be a sole trader or a limited company? Do you want to create your own brand or open a salon? Are you going to rent a commercial premise or work from home? Where your business is based and what variation it is will determine the considerations you’ll be privy to. For example, home-based salons need to register with the local council and apply for a license, while a mobile business has to consider car insurance costs and how far you’re willing to travel.
3. Costs and earnings
Do you need a loan? If so how can you afford to pay it back, are you aware of the terms of the loan, what will your interest payments be? What equipment do you already have? What do you need to buy? You will need to factor in any equipment costs and budget outlay when compiling a cash flow forecast.
4. Rules and regulations
This is where it can get tricky, but thanks to the Hair and Beauty Australian Industry Association, expert help is never far away. You’ll need to familiarise yourself with cosmetic regulation, the Packaging and Labelling of Cosmetic and Personal Care law, OHS, fair work laws, the Australian Inventory of Chemical Substances, workers compensation.
“The negatives of starting a beauty business are tax, BAS cash flow, international dangerous goods freight, labeling laws, audits and chasing lost parcels up with the post,” says Anna Ross.
“All the things you have to be on top of and very good at to keep your business afloat. People often never think of these things and I can guarantee that it’s 95% of the job. It’s never as glamorous as it sounds.”
Research can never be underestimated when starting a business. You need to gain an insight into your target market, analyse your competitors, identify potential opportunities, research locations, test new markets and much, much more. While it might seem pedantic, this strategy will ensure you’re as prepared as you possibly can be. Not only that, but doing your research can often uncover once hidden prospects.
“I created Curtis Collection Cosmetics after battling skin issues for most of my teenage years,” Victoria Curtis tells Professional Beauty. “After undergoing many skin treatments and seeing no visible results I became increasingly frustrated. Through my own research and experience in the industry, I soon realised that it was the make I was using that was holding me back.”
“Do your homework! Research your industry, your products and your market,” says Victoria. “Knowledge is power as they say and diving into the beauty industry head first is certainly not advised! Being prepared will benefit you and your business in the long run and thinking of something that does not already exist will be the key to your success.”