How to start a cosmetic business in Nigeria
The majority of working and business class Nigerian women spend a part of their monthly income on products that will improve their beauty, both short-term and long-term. Aside from making them more attractive to peers and strangers, it boosts their confidence as women.
Now that you know this, you can make a great deal of profit just by selling cosmetics and other skin products. In this post, you will learn how to start a cosmetic business in Nigeria.
How to start a successful cosmetic business in Nigeria
Follow these steps to start a successful cosmetic business in Nigeria:
1. Do a market research
Let’s make this simple. You will be researching 3 parameters here:
- Your ideal customers
- Purchase cycle
Market research on your ideal customers
The first thing is your ideal buyers. These are people that will be most probably interested in buying your cosmetics and skin care products. You can’t possibly sell cosmetic products to 80-year-olds, at least not in a proportion that will bring substantial profit.
Most of your customers will be females, ranging from 18 to older ages, probably around 40+.
Market research on the purchase cycle
Now, this part focuses on consistency. How many times will a customer buy back from you in a year?
If you only sell cosmetic and skin care products that help to remove certain blemishes and disorders from the skin, many of your customers won’t come back in a long time (unless the problem persists or occurs a second time).
This means that many of your target customers will only buy from you 1 to 4 times a year. Some won’t even come back. This means you have to make a substantial profit on each sale.
Now let’s look at another instance. If you sell beauty products alongside your skin care cosmetics, you can make a great deal of profit. Both men and women want to look good, so they will always come back at intervals to buy.
Market research on products
This part is pretty straightforward. You should identify which products will sell in your region. Some customers will rather buy Vaseline instead of Nivea because of one reason or the other.
2. Draft a business plan for your cosmetic business
Now, this part is optional, depending on the type of business you want to run. If you grew up in Nigeria, you will know that business owners can be categorized into two.
- Professional business owners
Professional business owners
Funny, right? A professional business owner is the type that has something really tangible in mind and he/she sees the business as an investment. Aside from making a profit, these business owners want to grow their brand, become recognized in the market, and dominate their industry.
They care about details, such as having a business plan, having a business name and logo, registering their business, getting investors, and the like. Some of these business owners are also willing to be acquired by larger businesses.
If your cosmetic business falls in this category, then you have to draft a business plan. It is the map of your business, it outlines everything you need to move on. This includes your business aims and objectives, marketing goals, startup costs, required equipment, and lots more.
You may want to read: How to write a business plan
Being a hustler is pretty simple. A customer buys something and you spend the profit immediately. You created the cosmetic business as your primary means of livelihood and you have no prospect of running it for long. Just for the time being until another opportunity comes knocking.
If your cosmetic business falls into this category, then you might not need a business plan. However, you should keep track of your inventory, sales, profit margin, etc.
3. Raise the needed startup capital for your cosmetic business
There are many ways you can get capital to start a cosmetic business in Nigeria. You can start with your own savings, get money from family and friends or visit microfinance banks.
If your cosmetic business is a professional one, then you have more funding opportunities aside from the ones above. You can prepare and submit business proposals to angel investors, venture capitalists, business accelerators, and commercial banks.
Suggested for you: How to get funding for a new business in Nigeria
4. Secure a good location
The next thing to do is to find a great spot for your cosmetic business. Whenever you’re looking for a place to site your store, you should consider:
- Target customers
Your target customers are those likely to patronize you. Although males also buy cosmetic products, they’re not as frequent as females.
You should site your cosmetic business in an area where there are many females between the ages of 18 to 45.
Another important thing to consider is the competition. If there are already more than two cosmetic stores in the area, kindly consider another location. You don’t want to run out of business before starting.
5. Brand and register your cosmetic business
The next step is to pick a business name. Make sure it’s related to your business, easy to remember, and also visually appealing.
From there, you should get a business logo, register your business with the Corporate Affairs Commission and obtain permits that apply to your region.
You might be interested in: How to create a business name from scratch
6. Stock your cosmetics store
Since you don’t have your own cosmetic manufacturing brand, you have to buy from wholesalers and resell them to your customers. The difference between the purchase and selling price (minus your capital) is your return on investment.
You have to take note of a few things while stocking your cosmetics store.
- Ensure the products are properly packaged before being transported to your store
- Take note of the expiry date
- Your cosmetic store should have a cool and dry environment
7. Hire some help (if needed)
While this may not be required at the beginning, you may need to hire some staff as your cosmetic business expands. If you will hire anyone, it should be a female.
The reason why is that most of your buyers are also females, and they might not be comfortable discussing their beauty preferences/problems with males. Your staff should be neat, polite, and above all others, trustworthy.
A large number of Nigerians, especially females spend a great deal on beauty and skin products every month. These products include body and hair creams, facial powder, bathing soaps, skin lightening creams, black spot removers, and many more.
The cosmetic business is becoming more profitable by the day, as many youths now want to look good. With enough skills and capital, you can start a cosmetic business in Nigeria and make lots of money by selling cosmetics and skin care products.
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