How to Start a Makeup Line: Everything You Need to Know
To figure out how to start a makeup line, you'll have to create a detailed business plan and determine what will set your cosmetics line apart. 7 min read
Updated June 26, 2020:
To figure out how to start a makeup line you'll have to create a detailed business plan and determine what will set your cosmetics line apart. There's a lot of competition in the makeup industry, so carving out your unique niche is important for being successful.
Women and the Makeup Industry
Makeup is very important to many girls and women. Sometimes, they just don't feel as “complete” without some kind of makeup on. It can be a confidence-builder since some women feel more attractive when they wear makeup. Makeup is more than pretty packaging, and consumers are always looking for quality cosmetics that make them feel good about themselves.
The global cosmetics industry is valued at over $170 billion per year. About $40 billion is in the Americas, while the other $130 billion is spread across Asia, Europe, Australia, and Africa. Customers in the Western part of the world spend more on makeup, although those in Asia and India are starting to catch up. This industry, also referred to as the personal care industry, has five main segments:
- Makeup (20 percent)
- Hair care (20 percent)
- Fragrance (10 percent)
- Skincare (27 percent)
- Other (23 percent)
The makeup segment includes lipstick, nail polish, blush, foundation, eyeshadow, and other cosmetic products used for beautification. According to data from the NPD Group, Inc., the luxury cosmetic industry has seen substantial growth over the last 14 years, increasing by 6 percent between 2004 and 2018. The annual growth rate since 2002 has been between 4 and 7 percent on a global scale, although the North American market dropped from 31 percent of the global sales to 27 percent between 2002 and 2004.
The majority of the psychographic and demographic compositions of those using makeup products are women, although the group is diverse. Women are generally more inclined to use these products. Additionally, actors, actresses, broadcasters, and celebrities use makeup, as well as many others.
Makeup and the Economy
Economic shifts and downturns impact the cosmetics industry less than other industries, such as automobiles. During the recession in 2008-2009, the growth of this industry grew moderately in comparison with the global GDP growth rate's drop. The demand for makeup tends to fall more slowly in recessions, while it increases drastically during recovery.
What Will Your Makeup Line Focus On?
Cosmetics doesn't only refer to makeup products; it also covers skin, facial, and hair products. When deciding to create a makeup line, think about which area you want to focus on. Niche areas in makeup include the following:
- Face powder
- False eyelashes
- Setting spray
- Nail polish production
How to Get Started
Before starting a makeup line, it's important to invest money and time into researching what people want and need. You need to work with others in the industry when performing research. It's critical to be as well-informed as possible, so take some time to speak with cosmetologists and others in the makeup and beauty industry to know where to start.
As you do your research, make sure to understand the trends and the details of how makeup works and is used. If you want to be in this industry, you must know how and why makeup works for people. You have to do more than just use it yourself. Spend the time to learn more about the methods for maximizing facial features, how to use cosmetics for certain skin problems, such as acne and dandruff, and the chemistry behind makeup products.
You can further your knowledge of the industry by:
- Learning more about alternative ingredients, especially since green products are growing in popularity in the makeup industry.
- Obtaining a degree in cosmetology.
- Reading biographies about famous people or companies that started successful cosmetic lines, such as Estee Lauder or Helena Rubenstein.
- Understanding the ingredients that go into various types of makeup, such as foundation, lipstick, and other products.
Continue to learn about the industry and how cosmetics are made. Doing hands-on experiments can also help you gain more knowledge while getting a better feel for how certain ingredients work with each other and what they can do to benefit those looking for these products. For example, you might experiment to figure out what ingredients can produce a brighter hair color or softer skin.
You can find books and other resources about cosmetic manufacturing at the local library or bookstores. Using online resources should be done cautiously as not all suggestions are safe or will work as described. Don't believe every piece of information you find. Instead, take the time to do your own experiments to make sure the results are what you want. You can also ask your friends and family to help test your products.
You'll likely be more successful if you focus on a niche from the beginning. For example, Poppy's Lipsticks is well-known around the globe for focusing on lipsticks instead of also trying to be Poppy's Eyeliner and Poppy's Hair Potion.
Choose a niche based on what you're most interested in and what you know you'll be good at. You also need to consider if the market is open for your particular product niche. You can always add new products to your makeup line as your business grows. Until that time, perfect your existing line and build your reputation in the industry.
Because the cosmetics industry already has lots of competition, the one thing that sets most successful companies apart is marketing. This includes the packaging and the promises they make of benefits such as glowing, youthful skin. Find the hook that will entice your potential customers.
You'll need to ask yourself some tough questions, such as the following:
- What makes my product special or different from what's already out there?
- Why should a customer take a chance on my product and stop using something they already like?
- What type of packaging will make my brand stand out and have that “wow” factor, while also looking trustworthy and reliable?
- What's my special factor or buzzword, such as “natural,” “shea butter-infused,” or “organic”? If you make certain claims about what your product will do, you need to have scientific facts to back them up.
How to Create a Business Plan
Makeup lines often require a lot of start-up capital and detailed planning, so you need a solid business plan. You may want to consult with some experts in your field when drafting your plan. When you have a workable business plan, you can cut down on the trial-and-error aspect of running a business. You'll have a purpose, and you'll be prepared to meet challenges and handle growth and expansion.
A solid business plan is a detailed guide that shows you how to manage your business effectively. It should outline strategies on how you intend to grow your business.
You have to be realistic when drawing up a plan. Don't over-project numbers like income and profits. You may want to underestimate in those areas so you're not surprised or disappointed when the real numbers come in.
When planning your business, consider the following:
- The concept of your business
- A description of your business
- Your business' vision statement
- Your mission statement
- Your business location
- Your plans to franchise, if any
- Your expansion plans in the U.S. or internationally, if any Key components of a business plan include the following:
- Startup generation
- Competitive analysis
- Products and services
- SWOT analysis
- Target market
- Marketing and sales
To create any business, including one in such a competitive field like a makeup brand, you'll have to do a lot of homework and research to figure out where you're most likely to be successful. Consulting with experts in the field is key. You need to set your line apart from everything that's already out there. A solid, workable business plan is the first step toward creating a successful business.
Legal Business Formation
After you have done your research and you're ready to get started, you will need to select a business name. Review existing names to make sure yours isn't too similar. The name you select is critical as it will impact the public perception of your business in the marketplace. Choose a name that fits the line you plan to be in when selling makeup. You should also create a logo that is compelling and aligns with your business goals and the name you select.
From there, the next step is discussing the business formation process with an experienced attorney who can help you decide what formation to choose and how to incorporate. You might want to start your business as a home-based option before expanding to a separate location, or you could elect to lease a shop. Finding the right facility from which to sell your product is expensive and can take a lot of time.
One of the benefits of this industry is the fact that it doesn't always require a massive production facility in the middle of the city. If you can save money by choosing a production facility location that is on the outskirts of the city, it is worthwhile to consider this option. It is more important to select a facility that allows you to have the lab equipment and other necessities for manufacturing your makeup. If you need a location to display products, it's easier to lease a small space in the middle of the city.
Selling the Product
After you have created your product(s), it's important to get it in front of as many people as possible. Visit department stores to discuss carrying your makeup, sell your product online, and consider hosting parties to get the word out about the makeup options you provide. Come up with several key selling points that will help encourage potential customers to buy your product and understand what sets your makeup apart from the many other options in the industry. Tell your background story and be upfront about why you chose to start the business.
If you need help starting a makeup line, you can post your job on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.