Beauty supply stores are physical retail establishments that mainly carry and sell cosmetics, beauty supplies, toiletries, and perfume. According to reports, the US cosmetics, beauty supply, and perfume stores industry includes about 17,000 establishments (single-location companies and units of multi-location companies) with total annual revenue of about $23 billion.
When looking to start a beauty supply store, you must put together a detailed business plan. Putting together a detailed business plan will help you figure out the costs associated with starting and running your business, it will also explain how you intend to stand out in this massively competitive industry.
Steps to Write a Beauty Supply Store Business Plan
Table of Content
1. Executive Summary
Purebred Beauty Stores is a standard distributor of professional beauty products in Reno, Nevada. This beauty supply store has everything to become the top beauty destination for cosmetics, fragrance, skincare products, hair care products, and beauty services. We are prepared to redefine how neighborhood-based beauty supply stores should be run, not only in our location but also in the whole of the United States of America.
2. Company Profile
a. Our Products and Services
At Purebred Beauty Stores, we intend to sell and supply only premium beauty products from well-established brands that deal in hair care, bath & body, fragrances, make-up, and skincare products, tools, and brushes. Our intention at Purebred Beauty Supply Store is to maximize profit and we intend to do all that is permitted by the law in the US to reach our business aim and objective. Below are the products we intend to sell at Purebred Beauty Stores;
- Wigs and Extensions
- Haircare products
- Bath products
- Fragrances
- Make-up
- Skincare and lotion
- Tools and Brushes
b. Nature of the Business (Business Model)
At Purebred Beauty Stores, we will be involved in retailing cosmetics, perfumes, toiletries, and personal grooming products. We are committed to offering our customers the best shopping experience with the most sought-after brands and products in the Beauty Industry.
c. The Industry
The industry we intend to focus on at Purebred Beauty Stores is the Beauty Supply industry.
d. Mission Statement
At Purebred Beauty Store, our mission is to establish a well-renowned, successful, and profitable beauty supply business that will grow from one store to chains of stores in various locations across Nevada and the United States of America.
e. Vision Statement
At Purebred Beauty Store, our vision is to become the number one beauty supply store in the whole of Reno City and also gradually grow to become one of the most renowned suppliers of beauty products in the State of Nevada and the United States.
f. Tagline or Slogan
Purebred Beauty Store – It is a Pleasure!
g. Legal Structure of the Business (LLC, C Corp, S Corp, LLP)
Purebred Beauty Store will be established as an LLC, fully registered in the State of Nevada. Our reasons for choosing the LLC as our ideal business structure include;
- Protect the personal assets of our owners, stakeholder, and employees
- Have tax choices that benefit our bottom line
- Grow our business
- Gain credibility with customers
h. Organizational Structure
- Chief Executive Officer (Owner)
- Store Manager
- Human Resources and Admin Manager
- Merchandise Manager
- Sales and Marketing Manager
- Accountants Cashiers
- Customer Services Executive
- Cleaners
i. Ownership/Shareholder Structure and Board Members
- Sarah Goshen (Chief Executive Officer/Owner) 49 Percent Shares
- Alfred Vance (Board Chairman) 21 Percent Shares
- Martins Winston (Board Member) 17 Percent Shares
- Kyra Moor (Board Member) 13 Percent Shares
SWOT Analysis
a. Strength
At Purebred Beauty Store, our business strength involves our choice of location, our business model that involves “selling franchise and opening chains of stores in various locations, a good number of payment options, a vast range of beauty products from well-renowned manufacturers both from the United States of America and from other countries, and also our exemplary customer service culture.
b. Weakness
We understand that being a new beauty supply store in Reno will count as a weakness for us, precisely within our first year in business. In addition, we also do not boast of the financial capacity to compete with multi-million dollar cosmetics, beauty, and fragrance stores in the United States, especially in terms of retailing cosmetics products at rock bottom prices.
c. Opportunities
Since our first shop will be located in one of the busiest streets in Reno City, Nevada, we believe it offers our supply store unlimited opportunities to market our beauty products to a larger group of people. Owing to the extensive feasibility studies and market survey we’ve carried out at Purebred Beauty Stores, we also know what our potential clients will be looking for when they visit our beauty stores, and we are ready to leverage all the opportunities that will come our way.
i. How Big is the Industry?
The beauty supply stores industry in the United States is very massive. According to industry reports, the market size of the industry in the US increased faster than the economy overall. The industry includes about 17,000 establishments (single-location companies and units of multi-location companies), and measured by revenue, they generated about $18.9bn in 2023.
ii. Is the Industry Growing or Declining?
According to reports, the beauty supply stores industry in the United States has grown 0.8% per year on average between 2016 and 2022, and it is still expected to increase 2.8% in 2023.
iii. What are the Future Trends in the Industry
Beauty supply stores have been in existence for as long as humans started trading goods, and that is why you can easily find mom and pop shops scattered all around the world. However, the industry has turned online and the advent of technology means that the future of any beauty store will be dependent on exciting technologies and the use of social media to boost customer engagement.
In addition, businesses in this industry always strive to meet customers where they are, some also respond by either acquiring their independent counterparts, partnering with them, or launching private-label alternatives.
iv. Are There Existing Niches in the Industry?
Truth be told, most successful beauty supply stores sell a vast range of beauty products. However, have it in mind that a niche can exist within those sprawling products.
- Professionals Only Beauty Supply Store
- Online Beauty Supply Store
- Hair Care and Shower Products Store
- Cosmetic Store
- Skin Care Product Store
- Fragrances and Deodorant Only Store
- Baby Care Store
v. Can You Sell a Franchise of your Business in the Future?
Yes, we at Purebred Beauty Store intend to launch our first beauty supply store in Reno City, before opening our store outlets cum franchise in strategic locations all around Nevada and other key cities in the United State of America
d. Threats
Just like any other business, we at Purebred Beauty Store believe that one primary threat we are likely going to face is an economic downturn. Truth be told, an economic downturn affects customers’ purchasing/spending power. In addition, the arrival of a new beauty supply store or even a supermarket that retails cosmetics in our business location will also count as a threat to our business.
i. Who are the Major Competitors?
- Sally Beauty Supply
- Bath & Body Works
- ULTA Beauty
- Sephora
- Merle Norman Cosmetics
ii. Is There a Franchise for Beauty Supply Store Business
- Beauty Supply Outlet: $15,000 – $25,000
- 4Ever Young Anti-Aging Solutions: $257,900 – $418,400
- The Lash Lounge®: $178,471 – $495,152
- Beauty Brands: $594,500-$936,000
- Armstrong McCall: $75,000 – $500,000
- SAHAR&VOSK: $5,600 – $30,000
- Noah: $8,000
- Buff City Soap: $235,000 – $320,000.
iii. Are There Policies, Regulations, or Zoning Laws Affecting Beauty Supply Store Business?
Yes, State rules govern the registration and licensing of businesses, as well as zoning laws. The rules will surely vary depending on the state your store is located, the type of legal structure you choose for the company, and other business laws. Some states have rules that apply to the zoning of business premises, therefore endeavor to check what the requirements are for a beauty supply store in your state before you buy business premises.
Marketing Plan
a. Who is Your Target Audience?
i. Age Range
At Purebred Beauty Store, our target customers fall within the ages range of 18 to 54.
ii. Level of Educational
At Purebred Beauty Store, our stores will be open to the general public, irrespective of class and level of education.
iii. Income Level
The area we serve at Purebred Beauty Store is populated mostly by the upper-middle class. They have the means to pay for higher quality service and are eager for beauty products and services.
iv. Ethnicity
At Purebred Beauty Store, there will be no restriction in terms of ethnicity. We are looking forward to fulfilling the varying needs of a vast range of clients.
v. Language
Our stores will be accessible to everyone, irrespective of language and accent. By leveraging Google Translator software, we also intend to welcome and sell to foreigners and every other client in our stores.
vi. Geographical Location
Anybody from any geographical location will be welcome to shop at Purebred Beauty Store
vii. Lifestyle
We expect our target market to be individuals working and/or living within a 5-mile radius of our business location in Reno City, Nevada. They should be people who are conscious of their looks and always strive to look and smell nice.
b. Advertising and Promotion Strategies
- Our regular advertisements will run to maintain exposure to relevant markets.
- Advertisements with major publications will be used selectively, depending on cost-effectiveness. These ads will include discount coupons so that responses to the ads can be tracked.
- Purebred Beauty Store will promote itself by distributing marketing materials and participating in local community events, such as school fairs, local festivals, homeowner associations, or sporting events.
- When not actively providing services to customers in the store, our professionals and other employees will make periodic, regular phone calls to customers. These phone calls will (a) ensure that customers are satisfied with their beauty products, and (b) remind customers after a certain period has passed that they might want to check out the latest products.
i. Traditional Marketing Strategies
- Collaborate with Spas and Venues
- Collaborate with Organizations for Good Causes
- Driving Traffic to our Business Website
- Offer Promotions and Discounts
- Use Creative Packaging for our Products
- Marketing through Direct Mail
ii. Digital Marketing Strategies
- Create a community to build brand advocacy
- Add testimonials to our product web pages
- Powerful content marketing
- Make use of Micro-influencers
- Find customers through social listening
- Collaborate with hotels and spas
iii. Social Media Marketing Plan
- Post Content That Will Intrigue Your Target Customer
- Use Facebook as a Key Communication Tool
- Use Twitter As An Information Source
- Provide Incentives For Instagram Word-Of-Mouth
- Provide Group Deals
- Use Twitter hashtags
c. Pricing Strategy
Our pricing at Purebred Beauty Stores will remain moderate to enable customers to feel that they received great value when patronizing our beauty supply store. Note that our customers can expect to speak with beauty experts for a more personalized and affordable price range of products.
Sales and Distribution Plan
a. Sales Channels
Purebred Beauty Store is an offline and online distributor of professional beauty products located in a major street in Reno City. Purebred Beauty Store is a one-stop shop for all your beauty needs. With our clients at the center of the experience, we plan to ensure that our beauty experts can effectively educate and assist customers.
b. Inventory Strategy
At Purebred Beauty Stores, we intend to source our inventories from top manufacturers and suppliers; we also intend to leverage inventory software to efficiently manage our supply chain operations. After extensive research, we decided to leverage Acctivate beauty supply inventory software.
Accitivate beauty supply inventory software is an effective system with real-time inventory control, robust EDI capabilities, and multi-channel order fulfillment. It offers Purebred Beauty Stores the following benefits;
- Track inventory in real-time
- Create stocking level alerts
- Input detailed product descriptions
- Trace goods throughout the supply chain from the manufacturing point
- Forecast future inventory purchasing needs
- Access a centralized data system of customer order history
c. Payment Options for Customers
At Purebred Beauty Stores, we intend to make available the following payment options to our clients;
- Payment via bank transfer
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via mobile money transfer
d. Return Policy, Incentives, and Guarantees
- At Purebred Beauty Stores, we will gladly accept returns and exchanges, as long they are returned within 7 days of the delivery date.
- At Purebred Beauty Stores, all returned items are subject to a 20% restocking fee.
- Customers are expected to contact us for their R.A. (return authorization) number before shipping an item back.
- Original shipping charges are non-refundable. We will not refund any used items or items without the original packaging.
- Note that to qualify for a refund, all items are expected to be returned unused and in their original condition, including the original packaging and containers, documentation, warranty cards, manuals, all accessories.
- We plan to refund the cash to the credit card or PayPal account the customer used to buy the item.
- We will refund shipping costs only if the return is a result of our own mistakes.
- Owing to Health Department Regulations, Purebred Beauty Stores will not accept returns on the following products: hair brushes, nail polish, make-up/cosmetics, hair extensions, hairpieces, wigs, or any item that touches the hair, skin, or scalp.
e. Customer Support Strategy
At Purebred Beauty Stores, we understand the importance of repeat customers to the success of our stores. Therefore, as our customer support strategy, we intend to award bonus cards to returning customers. The more they spend, the more points they receive.
These points can be converted to free products and extra discounts off bulk buy when the points build up. We also intend to offer a good number of personal delivery options. We also intend to make sure friendly staff and advisors are always available for our clients online and in-store.
Operational Plan
- Convenient location
- In-house, experienced beauty experts
- Significant personal attention
- Moderate price point
- Comfortable, customer-focused environment
a. What Happens During a Typical Day at a Beauty Supply Store Business?
- Test new products and gather feedback from customers
- Fill product orders and ship to destination
- Advise customers on personal beauty and skincare needs, helping them achieve their desired look
- Network within community/industry and market your business
- Meet up with manufacturers and suppliers
- Conduct detailed research and keep up with the latest trends
- Regular sales team meetings to discuss current business trends and ongoing needs
- Administrative duties
b. Production Process (If Any)
Currently, there are no production plans and processes in place at Purebred Beauty Stores.
c. Service Procedure (If Any)
- Extensive planning
- Hard work
- Target our marketing efforts
- Adequate attention to details and the needs of clients
- Research continuously to remain on top of the latest trends.
- Network, network, network.
d. The Supply Chain
At Purebred Beauty Store, we will rely on trusted and well-established businesses to supply our stores with inventories and products. Currently, we have been able to establish business relationships with wholesale supplies like;
- Novopac Laboratories
- CassCo Bio Labs
- Vigon International
- Johnson & Johnson
- Procter & Gamble
- RNA Corporation
- ABS Corporation
- Healthy Solutions
- Estée Lauder
e. Sources of Income
- Individual sale of beauty products
- Wholesale distribution of beauty products.
Financial Plan
a. Amount Needed to Start your Beauty Supply Store Business?
Owing to our choice of location, rent/lease of property/outlet, the cost of initial stock, staffing costs, delivery import, and export costs, we will need about $435,500 to open a shop at Reno City, Nevada.
b. What are the Cost Involved?
- Legal expenses: $72,500
- Startup consultants (Business experts, attorney, insurance agent): $53,000
- Insurance: $32,750
- Rent: $78,500
- Research and development: $32,750
- Equipment (lighting, display cases, POS, and Business Management System): $62,750
- Signs: $12,250
- Payroll:$129,800
- Advertising and marketing material: $46,210
c. Do You Need to Build a Facility?
At Purebred Beauty Store, we do not intend to build a new facility, but rather to start with a long-term lease.
d. What are the Ongoing Expenses of Running a Beauty Supply Store Business?
- Stocking inventory
- Marketing strategy and related advertising investments
- Insurance
- Education, travel, and market research
e. What is the Average Salary of your Staff? List the Job Position and their proposed salary based on industry rate and your startup capital
- Chief Executive Officer (Owner) – $74,460/year
- Store Manager – $54,567/year
- Human Resources and Admin Manager: $66,870/year
- Merchandise Manager – $50,256/year
- Sales and Marketing Manager: $69,689/year
- Cashiers: $48,000/year
- Customer Services Executive: $29,406/year
- Cleaners: $25,836/year
f. How Do You Get Funding to Start a Beauty Supply Store Business
- Funds from personal savings and sale of personal stocks and properties
- Funds from investors and business partners
- Sell shares to investors
- Seeking business loans from banks
- Obtain soft loans from family members and friends.
Financial Projection
a. How Much Should You Charge for your product/Service?
All our products at Purebred Beauty Store are sold by the unit and vary in price; however, they sell for upwards of $50. The area we serve is populated mostly by the upper-middle class. We believe they have the means to pay for high-quality service and are in search of beauty products somewhere between deep discounters and top-end luxury brands.
b. Sales Forecast
Truth be told, we know that our store may not reach the profitability baseline in the first month, but it will become fully profitable by the first quarter of the first year. We also expect that Purebred Beauty Stores will reach its full potential of sales in the first year.
- First Fiscal Year (FY1): $670,000
- Second Fiscal Year (FY2): $1,310,000
- Third Fiscal Year (FY3): $3 million
c. Estimated Profit You Will Make a Year? (First year)
Just like it was noted above, we understand that our store might not pick up the profitability baseline in the first month, but we have put in place advertising and management strategies to easily mitigate that possibility. In terms of sales, we expect an exponential increment in the first four weeks of the store. With a full-blown store, we expect to make around $350,000 to $700,000 annually within the first few years of business.
d. Profit Margin of a Beauty Supply Store Business
According to reports, profit margins in this industry average 40%, with some running as high as 80%, depending on factors like location, class of inventory, advertising strategies, and management style.
Growth Plan
a. How do you intend to grow and expand? By opening more retail outlets/offices or selling a franchise?
At Purebred Beauty Store, we aim to establish a well-renowned, successful, and profitable beauty supply store that will grow from one store in Reno City to chains of Purebred Supply Stores in various locations across Nevada and the United States of America, franchised to handpicked entrepreneurs who must have undergone extensive business training to acclimate with our business culture.
b. Where do you intend to expand to and why? (Geographical locations)
Within our first 10 years in business, we intend to expand into top urban cities in Nevada. We intend to expand our business lines and offerings in Las Vegas, Henderson, North Las Vegas, Paradise, Spring Valley, among others.
Exit Plan
For so many good reasons, at Purebred Beauty Stores, we strongly believe that acquisition and mergers will suit our business interests. According to reports, investor enthusiasm in the industry has grown massively over the years and isn’t likely to dim. Venture capital firms like Female Founders Fund and AN8 are always on the lookout for viable businesses to partner with, and we will definitely reach out to them when the time is right.