Fashion Business
How To Start A Cosmetics Shop?

How To Start A Cosmetics Shop?

How to start a Cosmetics shop in a world where appearance matters and makes a difference? Cosmetics are products that are always in demand and the market for cosmetic products is expected to expand owing to the growth in global economies, changing lifestyles, rising demands of skin and sun care products due to varying climatic conditions.

Cosmetics are the products used to clean, change or improve one’s external beauty which includes the skin, complexion, hair, nails and teeth. Cosmetics can thus be defined as “substances or products used to enhance or alter the appearance of the face or fragrance and texture of the body”. These products are usually made with a mixture of certain chemicals or even using naturally found ingredients. The cosmetics business is a broad category consisting of a variety of products which are sought after by a large and diverse customer base.

The demand for cosmetics is constantly on the rise, and with rising double incomes, the market for it is expected to grow further. This is one of the reasons why starting a fashion business, especially a shop, in the cosmetic products field is a good idea. So if you are wondering how to start a Cosmetics shop then this is a must-read.

 Other advantages of the cosmetics business include-

Variety Of Products

The cosmetics business encompasses a large number of diverse products catering to customers from all age groups, genders, ethnicities, all over the globe. Those aspiring to start a cosmetic business can choose from a wide variety of product ranges to venture into and create a niche for themselves by choosing to deal in selected products, choosing from skin care products such as lotions, creams, serums, oils and cosmetic products like lipsticks, blushers, tints, eyeshadows, nail paints, highlighters, kohl, mascaras and several more. Similarly haircare and nail care products are also included under the cosmetic products category, thus making the product range huge and diverse in the business.

Large Audience

The cosmetics industry is one of the biggest industries in the world and the audience it caters to is also large and diverse. It is estimated that on an average every woman in the world has a minimum of 5 cosmetic products with them, this itself is proof of the large reach and extensive customer base of cosmetic products.

Repeat Customers

Cosmetics have a shelf life but once customers start using certain products they repeated opt for the same or similar product on a regular basis. This means that the cosmetic business has a number of repeat customers, which is another advantage while starting the business as it guarantees a fixed customer base, which is a must for every business.

Scope For Niche Products

The cosmetics industry is so large and diverse that aspiring entrepreneurs can select any specific cosmetic products such as nail paints or haircare products or skin oils or facial cosmetics only and specialise in that particular field thus creating a niche market that attracts a targeted audience. Dealing in niche cosmetic products helps create a recall value for the business and also allows the business to grow and expand in the particular sector itself, thus creating a demand for the products and the business.

Experience Not Required

The cosmetics business is such that it does not require any prior training or experience to start the business. This is a helpful factor that encourages budding entrepreneurs to take the plunge without hesitation to start a cosmetics business.

Additionally, while setting up a cosmetic business, such as a shop, there is no need for special equipment or machinery, thus saving on resources and capital which can be utilised elsewhere in the business. 

How To Start A Cosmetics Shop?

The first step to a successful business is a viable business plan. Create a cosmetics business plan which will provide you with the guidelines for running your business smoothly. It will keep a track of finance, management and marketing of your business. A business plan is like a road map which will help you set long term goals and stay focused on them.

how to start a cosmetic shop

While starting a cosmetic shop, the following pointers will help ease the process- 

Consider The Nature Of The Business

    • Business Type

When starting a cosmetic shop the business owner can select whether to have a retail counter that houses products of all brands and of all types, including skincare and makeup products or deal in the products of a particular brand only thus acting as a standalone flagship store or the business owner can supply only to salons and beauty parlors and operate as a shop selling products in wholesale. The business model must be decided upon while considering to start the business.

    • Business Entity

The type and structure of the business is also equally important and must be decided by the business owner before physically starting the cosmetic shop. Entrepreneurs can choose from a sole proprietorship or a partnership or even a one person company or a limited liability partnership. Each business entity has its own advantages and thus entrepreneurs must choose the structure most suitable for the business and appropriate for the cosmetic shop. 

Research About Required Licences And Permits

The cosmetics business and shop requires certain licences and permits in order to operate the store. Often these permits and licences are mandatory, such as the Shop Act, GST registration, trade license as well as regulations from FDA which need to be followed. These licences and registrations require submission of documents and paperwork while applying for them and also most of the licences are granted after a few days. It is therefore necessary for entrepreneurs to know of these regulations and apply for and procure these necessary licences and permits before starting the cosmetic shop. 

For example, to obtain Shop Act in Pune,  Shop Act In Mumbai or any other city in Maharashtra, the applicant will have to first register with MAITRI (Maharashtra Industry, Trade And Investment Facilitation Cell) website ( For other states, the process would change.

Or, to get GST registration in Pune, GST registration in Mumbai or anywhere in India, the applicant can use the online registration link – the need for visiting the local office arises, you can check out the local contact number or address using the link mentioned.

Select Location For The Business

Location is one of the most important factors to consider while starting the cosmetic business. A shop that is centrally located and easily accessible will definitely attract more customers as compared to a place that is hidden in a by-lane or not reachable easily. Also, while choosing the location the competition present in the area must also be considered. Ideally a location where there is a need for a cosmetic shop will be more suitable owing to the demand. The cost of renting the space or purchasing it must also be taken into account while choosing the location. Thus, location for the setting up the cosmetic shop must be chosen carefully.

Develop Marketing Plan

For a business such as cosmetic products, there are a number of products and an equally high number of retailers selling the various products. Cosmetic products are in demand and that is why there are a number of providers supplying to the demand. In order to stand out against the competition and to ensure higher footfall at the shop, business owners need to plan marketing strategies and market their business. Some strategies under this service include considering a brand name for the business and also a logo which customers can associate with the shop and which has a recall value. Apart from branding, publicity campaigns can be designed using marketing services including digital advertising mediums such as advertising about the business on social media platforms or having informative blogs and videos about using the cosmetic products. Vlogs on how to apply makeup or how to get ready for a party in a jiffy or different looks for day and night occasions can help advertise the products and the business too. In the age of Instagram, influencers too can be approached to talk about the products, thus helping reach a wider audience. These marketing strategies help provide a digital presence to the business. Additionally, feedback is also an important aspect to consider regarding the products, it’s use and effectiveness and also feedback of the marketing strategies.

A marketing plan must be decided beforehand to ensure the success of the business.

how to start a cosmetics shop

Consider Capital Requirements

Cosmetic shop, like every other business, requires capital investment and these must be calculated before starting the business. The costs for the business include leasing a shop, equipping it with basic essential furniture for display and sale, procuring the cosmetic products and also the mandatory licences, and other miscellaneous expenses such as electricity, repair and maintenance, wages of sales staff, etc. All these costs must be considered before starting the business and the next step involves considering options from where to procure funding for these expenditures. Bank loans, or loans from non banking financial institutions is the recommended option. Apart from these borrowings from friends and family or savings can help start the business too. These options and their requirements must be known while learning how to start a cosmetics shop.

These are some of the basic essential factors that are vital and need to be considered when learning how to start a cosmetics shop. Further struggling entrepreneurs can benefit from the services of deAsra for starting the entrepreneurial venture and for assistance in marketing strategies and licencing requirements, etc when they consider opening a cosmetic shop. 

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