How to start a start-up in the cosmetic sector

How to start a start-up in the cosmetic sector 900 900 admin

Selling cosmetics today is a business that can be very profitable. According to estimates published by ANSA, the total turnover of the cosmetics sector in 2021 (currently being calculated) will exceed 11.7 billion euros, increasing by + 10.4% compared to 2020. And by the end of the year in course, 2022, global turnover is expected to exceed the pre-Covid period.
More and more brands are entering the market. And if you too have thought of starting a start-up in the cosmetics sector, then you know that you will have to deal with fierce competition. This is why it is vital to start on the right foot and start your cosmetic sale most correctly, setting the basis for achieving your commercial goals.

Market analysis and marketing for the cosmetics start-up

To get started with your business, you can start getting an idea of ??the latest market trends to understand which ones may be right for you. If you collaborate with a scientific laboratory you can think of products with original formulae, and active ingredients studied ad hoc. If, on the other hand, you have experience in herbal medicine, you can aim for natural products, which are increasingly in demand.

Laws and bureaucracy for the cosmetics start-up

The cosmetics sector is one of the most regulated in Italy. This is why the products on sale are safe for health. So let’s make the best of a bad situation in the face of the bureaucratic process to follow. For your company you will need to have a VAT number, then register with the Business Register. Ask for advice from a consultant or directly from the public offices of INPS and INAIL to understand if there are other charges against you, as surely happens if you have staff who work with you). Do not be discouraged and continue with your head down, the beginning is always the most complex moment. You will need to notify your municipality of the start of the activity at least 30 days in advance. The municipality will notify the Fire Brigade to inspect the premises dedicated to working. And if you produce the formulae directly, control of the Local Health Authority will also be triggered. In this case, you will also have to appoint a technical manager, a role that you can also support if you have the skills.

Create a cosmetics line with products to sell online

Also according to ANSA, e-commerce in the cosmetics sector is growing by almost 30% for a total value of 900 million. And if sales go well, you won’t have to risk being out of stock. Yes, because one of the fundamental calculations is precisely to establish how much to produce to respond in real-time (or in any case shortly) to the customer who has chosen you. If you use the service of a contract manufacturer you certainly have greater security. If you have chosen the online channel, try to highjack your choices according to this type of sale. Always think about shipping and the fact that the product arrives by itself, without being presented by the staff as in perfumery. Two things already come to mind: opt for lightweight containers that will not get ruined during the journey and insert a card with a communication and your brand in each package.

Cosmetic marketing techniques and strategies

The brand: It doesn’t matter if you plan to sell a few products or if you have a huge range to offer. In any case, you will have to work on your brand, creating a recognisable, contemporary, and above all distinctive brand of your product. The brand is present in every moment, so it must be a name that convinces you and that speaks to your world, to the benefit you offer to your customers. Also, think of a phrase that can be an inspiration for all your communications. You can be inspired by the reasons that prompted you to open a cosmetics company or imagine the feeling of your customer using your products.
Empathy: It is a word “stolen” from the psychology sector and indicates the ability to understand the interlocutor in this way and to share feelings. Today it is more important than ever to give customers this impression. When we browse social networks or go to various sites, we appreciate this pleasant sensation. Speaking (and above all writing) in an empathic way cannot be improvised. For this, you can think of the service of copywriters specialised in the sector. Thanks to the “package” formula proposed by some structures it could have a lower cost than you think.
Fidelity: All the contacts you have on the internet are a real asset to keep alive. Try to organise, communication tools that involve people who have shown interest. After asking for the necessary permissions, you can think of sending a newsletter or starting a loyalty programme with a sort of collection of points or growing discounts, inviting your customers to repeat their purchases on your e-commerce.
The sharing: The interactive relationship is the winning one to sell your cosmetics more. So, use social media to share your content and never leave a question unanswered. Rewards users’ interventions with a quick reaction. Remember, this is your brand page and not a personal page. Insert your image or personal content only in extra cases where there is a link with your brand. And that’s not all. Always in the name of sharing, prepare your packaged products so that they are pleasant to share, perhaps in an “unboxing” video that reveals the contents of a package received. A nice pack is gladly photographed and posted on social networks.
Sustainability: Today it is no longer a choice, but a highway. Even if you’re not a brand that focuses on sustainability, consider how to incorporate sustainable actions into your marketing decisions. This could constitute reassurance and a reason why that gives more confidence to the undecided. Once you have thought of the sustainable action that you can take, remember to tell it thru social media, which will act as an amplifier, for example cleaning the beach or the forest near your office.

How much does it cost to start a business in the cosmetics sector?

Before starting your cosmetics sales business, it is essential to create an income statement. It is better to predict costs by a large margin. The costs are different according to your setup. If you have thought of producing independently, you will have to support the purchase of the machinery, as well as renting a suitable space for cosmetic production and packaging. You will also have to take care of the costs of raw materials, which can be very different, depending on the quality. And if you have devised an innovative formula, you should also patent it to protect it and keep it yours. If, on the other hand, you plan to sell cosmetics made by third parties, you will have to agree on a fee for the products. And if you want the security of your brand, you will need to register the trademark so that no one can copy it. Finally, there will be the costs for communication and for making your product known. Do you want a reference figure to start your cosmetics company? A truly indicative figure is around 100,000 euros, but there are many points on which you can save while still obtaining high quality, for example with communication packages that guaranty you a limited and tailor-made investment.