Business Featured

How to Start a Cosmetic Business with Low Investment

By Shreya Durgan

Starting a cosmetic business in India is a tough task, but with the right knowledge, you can achieve anything. In fact, there are many aspects to consider and keeping up with the latest trends can be difficult.

This guide provides an overview of the process you should follow to start your own cosmetic business in India and also shares some tips and tricks on how to stay afloat.

Step 1: Research and Find out the Market Demand

Step 2: Find a Supplier

Step 3: Prepare a Business Plan

Step 4: Register your Business and Apply for the Necessary Licenses

Step 5: Open a Business Account and Enable Online Payments

Step 6: Set up an Office Space and Display your Products

Step 1: Research and Find out the Market Demand

India is one of the fastest-growing markets for cosmetics, and the industry is projected to grow at a CAGR of 5.4% from 2018-2024.

In addition, India's population of young people, who are the main consumers of cosmetics, will continue to grow over the next few years.

The Indian government has also been taking steps in recent years to promote entrepreneurship and improve access to finance for entrepreneurs like you.

Cosmetic products have been used for centuries by women to enhance their natural beauty.

In recent years, men have also started using them for grooming purposes.

As a result, now you have a much wider customer base to target.

Moreover, there are many factors that have encouraged the growth of the cosmetic industry in India, such as rising disposable income, changing lifestyles and the increasing number of women entering the workforce.

There are various ways to find out the market demand, but the most important and effective way is through surveys.

Surveys are one of the best ways to get an objective opinion about what people think about your product or service. It is a very simple, inexpensive and quick way of getting feedback.

Step 2: Find a Supplier

The world of beauty and cosmetics is one of the fastest-growing industries in the world. It is also a very competitive industry.

In order to be successful, you need to develop a strong supplier network that can provide you with the products that your customers want at a reasonable price.

Moreover, they must be able to meet your production and delivery deadlines.

There are three ways to find suppliers for your cosmetic business in India.

Local Wholesalers:

You will be able to identify the local wholesalers by having a word with your competitors in the market.

For this purpose, you cannot go directly. Thus, disguise yourself as a surveyor or researcher to know about all their suppliers.

Social Media:

Social media platforms such as Facebook, Instagram, and LinkedIn are great sources of information on different brands and their suppliers.

You can also use hashtags such as #beautyproductsupplier or #cosmeticsupplier on Twitter or Google Plus to find suppliers that way.

Online Directories:

There are many online directories that you can use to find potential suppliers for your business, such as TradeIndia, Alibaba, BizTradeIndia etc.

These websites let you browse through different products and make contact with the right people easily.

Step 3: Prepare a Business Plan

It is important to prepare a plan for your cosmetics business in India. This will help you run your business and make it more successful.

To make sure that you are prepared for success, here are some steps to follow when creating your plan: -

Define your goals: What are you trying to do with your business? What do you want it to look like? Are there any specific areas that you want to focus on? Defining these goals will help guide the rest of your planning process.
Create a timeline: Once you have defined what you want from the future of your business, you can create a timeline to show how you will achieve your goals.
Create an action plan: One thing that can often get forgotten when planning for success is the action plan! Make sure that there are specific steps for what will happen when you start the business and specific dates for when these actions will be done.
Track your progress: Once you have created your plan, it is important to make sure that you keep track of your progress. Use websites like google docs or printables to help keep track of all your work.
Make a risk analysis: One thing that can often get forgotten when planning for success is risk analysis! Make sure that there are substantial plans in place on how to handle any risks that may arise.

Step 4: Register your Business and Apply for the Necessary Licenses

This step will help you with the best way of registering your cosmetic business in India.

All you have to do is fill out the form on your right and provide the basic details.

After that, an expert will get in touch with you and help you with the complete registration process online.

The most suitable legal structure for a cosmetic business can be:

Private Limited Company Registration Online
One Person Company
Limited Liability Partnership
Sole Proprietorship
Partnership

Once you have registered your cosmetic business legally, apply for the following necessary licenses:

GST Registration (if required)
Shop and Establishment Act

Step 5: Open a Business Account and Enable Online Payments

The most crucial step is to decide which bank you want to open your account with.

There are many banks that offer business accounts for businesses, but most people choose ICICI or HDFC because they have lower fees and higher interest rates than other banks.

We are living in an age of technology. We have seen the evolution of smartphones, and computers, and now we have a new technological advancement called digital payments.

UPI has become one of the most popular modes of digital payments in India, especially in the aftermath of demonetization, due to its convenience and ease of use.

In fact, this is a much faster and more convenient way for customers and merchants to transact.

There are various benefits that come with using these gateways, such as: