How to Start an Online Beauty Supply Store - A Stepwise Guide

Online beauty is booming, and it's not just big brands entering the $532 billion industry. Smaller brands that focus on a single product -- handmade soaps or niche cosmetics -- are a growing part of the beauty industry.

If you want to sell beauty-related products like beauty supply online and to be a beauty entrepreneur, you need a significant plan to follow to get your online beauty shop involved in this action.

Why Sell Beauty Supply Online

Online beauty supply shops sell all kinds of beauty products, from cosmetics to skincare products. Skincare, cosmetics, and hair care products are the most retailed products in the industry.

It's not difficult to open a beauty, cosmetics, and perfume - beauty supply - shop, and it's not capital intensive, especially if you choose to set up the shop on a small scale online. Getting the right brands that people want to buy is the secret to running a beauty supply store.

The beauty supply store industry is indeed big business, which is very active in countries such as the US, UK, France, Italy, The Netherlands, Switzerland, Japan, China, Germany, and Canada.

A close look at industry activity shows that skincare, which includes lotions and creams, accounts for the largest share of the industry's revenue, estimated at 27%. Most of these goods are considered less discretionary than cosmetics and perfumes, allowing the segment to grow even during periods of weak consumer spending, as it did during recessions.

In fact, innovative skincare products designed specifically to fight age have increased the industry's bottom line. Similarly, a wide selection of products has driven revenues in the beauty supply store industry over the past five years.

Sell Beauty Suppliers Online: A Stepwise Guide

If you want to know how to start an online beauty supply shop, ask for nothing more. This guide breaks the process down into five simple steps. Once you've taken these steps, your beauty supply store business is ready to start.

1. Conduct the Market Research

Economists say the beauty industry is more likely to weather the economic storm because the beauty target market values quality beauty products. While they may forgo other luxuries, they continue to indulge in beauty products to boost their mood during tough times.

When conducting beauty supply market research, you will need to refer to the primary and secondary research for information and incorporate them into your findings, as both types of research are required for overall market research activities.

The combination of these two sources of research can yield powerful insights to help shape your product & brand and find out which niche market you want to join.

Primary Market Research

Primary market research in the beauty industry usually involves direct interaction with existing or potential customers. It mainly collects information about the target market and can segment the market.

The overall customer base is then divided into smaller, more unique, and more precise market segments. Some entrepreneurs choose to do their own primary market research, while others outsource it to research specialists.

Secondary Market Research

Secondary market research refers to the process of gathering data from open sources. This process can be accelerated by purchasing high-quality market research reports that provide data, statistics, and results in an in-depth format. Secondary market research can power your research project and help you identify areas that should be further explored through primary research.

In addition, the primary market research helps you know more about your target market. Meanwhile, the secondary research allows you, from all other areas related to the beauty industry, to collect key data and insights, such as the industry status, niche market, and competitors.

To brainstorm, create, customize, deploy, and reach target markets, you can ask online survey platforms to provide the software and technologies to conduct professional market research.

In turn, it becomes easy to create surveys that help you collect highly specific information about your target market's needs, beauty inspirations, dislikes, shopping behaviors, and more.

This will give your brand the competitive edge that your online beauty supply business needs to be and keep profitable in the industry. With this form of beauty supply market research, you'll be ready for everything to come.

2. Decide the Distribution Model

Some beauty supply retailers could forgo physical stores altogether and sell only online. Your beauty supply shop can follow a variety of online business models:

Dropshipping

In this type of model, businesses sell products online without inventory. Shoppers place orders at checkout, and sellers send those orders to the third-party suppliers, who then send the products ordered to the customer directly.

In this model, stores do not need warehouses and complicated logistics, making it perfect for small businesses. Revenue and profit depend on the difference between the price of products sourcing from suppliers and the price sold to customers.

White Labeling

Under the white labeling (also known as the private label) business model, products are made by one company, without labeling, and then sold to numerous dealers. For example, a white-label manufacturer will sell shampoo to seven different retailers.

Each retailer can put its own brand on the shampoo, customize the package in its own branded container, and then sell the shampoo to customers. The white-label model is a great way to quickly move from idea to final product.

Manufacturing

Using this model, your product is specially manufactured and you have the legal right to sell the product under your brand name.

However, finding trustworthy manufacturers to work with can be challenging, expensive & time-consuming. So this is always the choice for big companies rather than the small online businesses.

Wholesale Warehousing

With this model, you buy products, store them in a warehouse, and then sell them through your online store. This is the most challenging model because you should invest in warehouse space and inventory management tools. However, you can monitor product quality, compliance, and shipping.

▪ Don’t Need Inventory

The biggest reason many online sellers choose the dropshipping model is that there is no direct inventory cost. By not holding an inventory, the seller gives up inventory holding costs, including storage facility costs, labor costs, investment risk costs, pre-capital investment, etc.

▪ Handy Dropshipping Tools

Dropshipping is a well-established distribution model now, so there are many dropshipping tools like DSers that can help optimize margins for your online beauty business and ease the process of order fulfillment.

▪ Get Paid Before Delivery

Dropshipping does not require you to pay for inventory upfront, which is very friendly to businesses with low cash flow. Without the burden of pre-invested inventory, it’s financially risk-free for merchants to offer a wider range of beauty supply products.

3. Get License for Your Store

Depending on your location and the nature of your work, you may need to obtain licenses and permits at the federal, state, county, and city levels to open and operate an online business. These include registered small business taxes.

Seller’s Permits

In most cases, you can register online or by mail for e-commerce sales tax at little or no charge. Registration requires submitting an application to the state tax department and providing basic information about your business, such as your federal tax number, business address, state of residence, and income.

Once your application is approved, the state will provide you with a state sales tax identification number. Many states have specific rules for third-party sellers (also known as "marketplace facilitators"), such as Etsy and Amazon.

Typically, the marketplace facilitator is responsible for collecting sales tax on behalf of the seller. If you're selling through a third party, be sure to check each state's rules for market promoters.

Reseller’s Permits

If you purchase materials or products for resale to your customers while avoiding paying sales tax on those purchases, you will also need to obtain a reseller's license, also known as a resale certificate,

When making resale purchases, you present the reseller’s license to the supplier to allow tax-free sales, and the supplier reports the sale to the tax authority.

States issue resale certificates to avoid taxing the same item twice, so they may only be used for items you plan to sell and collect sales tax.

If your state issues a resale license, you can apply through your Revenue Department. Some states do not issue separate dealer licenses, relying instead on your sales tax identification number. Check your Revenue Department website for application instructions.

4. Build an Online Store

Selling beauty products online is not as difficult as it used to be. There are a variety of e-commerce platforms and tools that allow you to set up an online store at a low cost.

When creating an e-commerce site, you need to consider many factors, such as site functionality, performance, scalability, security, ease of use, SEO (search engine optimization), payment solutions, etc.

Use Shopify to create an online beauty supply shop is a wise choice. Shopify is the leading e-commerce platform that allows you to handle heavy web traffic.

If you are looking for a highly scalable and flexible solution with plenty of off-the-shelf functionality, then this is your best bet.

▪ Multi-platform sales: It sells through multiple channels, including Facebook, Instagram, Amazon, and eBay.

▪ Great design: Choose from some free and paid templates, or make your own from scratch if you can't find a match. And ensure that you have a high-quality memorable logo design that matches your online shop's visual elements.

▪ 3,000 + Apps: Shopify has an incredible library of apps like DSers and third-party extensions that can help you take your store to the next level.

▪ Multiple payment methods: Shopify supports over 100 payment methods and offers its own gateway Shopify Payments.

It provides all the functionality needed to manage the store and build the brand. In addition, it provides integration with analytical reporting tools to help you effectively manage your business performance and direct sales applications to help you fulfill orders. You control your site, but you need a solid marketing strategy to attract customers.

5. Promote Your Store

The marketing of beauty supply emphasizes visual advertising. The product is used to improve the appearance; Naturally, their effects require visual demonstration. This photogenic element is more of an advertising focus than many other industries and maybe more resource-intensive.

Professional models and photography may be required, and social media plays an important role in all marketing efforts.

The prominence of "influencer advertising" to best reach your target demographic will determine the typical structure of most beauty products marketing campaigns.

Your marketing plan should utilize the social media platforms that best promote photography and other related topics. These include Instagram, Pinterest, and TikTok.

Also, when your business is growing and you earn more profits, you can be prepared to hire experienced photographers and videographers to capture your subject in the best light -- figuratively and literally.

DSers - Take Your Beauty Supplies Business to Next Level

To dropship beauty supply, you just need to do some research. From the above discussion, you have probably extracted the central idea of your store. Therefore, you know the products that need to be sold.

An easy way to find the best dropshipping beauty supply suppliers is through dropshipping tools. As mentioned above, DSers is the best tool to utilize when you use Shopify to set up your online beauty supply store.

With DSers, you can easily find suppliers with its Supplier Optimizer feature, place large orders through its Bulk Order feature, and using Auto-update Order Status to keep track of order details.

Final Word

Given that most online beauty supply stores can barely survive on about $5,000 to $10,000, it can be profitable to run such business if taken seriously and marketed effectively.

It's clear why the industry is so prominent and why owning your beauty supply store is a good idea with the right determination and effort. Are you ready to launch your beauty supply brand? If done well, selling these products online can now be a lucrative business idea.