New Business In The Beauty Industry Business Plan Examples
Introduction & Business Overview
I have been interested in beauty industry since I was a little kid. I can watch online make up tutorials for hours and learning more and more on beauty industry every single day. My dream was always to have an opportunity to organize my own business that would be closely related to the beauty industry. I have been thinking about many various ideas on how to make my dream come true, and then I realized that, as many people say, dreams do not work unless you do. Therefore, I have started to do something instead of just sitting and dreaming. Relying on my personal experience from reading so much about beauty industry and watching so many videos and making an online research while reading forums and blogs, I made a conclusion that there is a need in high quality beauty products in Saudi Arabia. Not all of cosmetics brands are represented in the market of Saudi Arabia, and fashion and beauty bloggers are missing the opportunity to purchase various makeup, skincare, hair & body care, and beauty supplies in their country. Which is why I have decided to start my own business in November in the year 2014.
My business idea is that I provide online services for women in Saudi Arabia, who want to choose high quality beauty products. I consult them and help to make their choice and finally I ship those products to Saudi Arabia to the customers. For the moment, the business works through online networks, and I offer my services and related products through online media.
I have been watching various beauty bloggers from all corners of the world. The age of those women varies from 17 to 45 years old. Many of them have been in this business for years. The main target market of my business is women who live in Saudi Arabia and who take care about their appearance and their bodies. These women love beauty products and actually know something about this industry, because they feel a need in high quality products from United States that are not available in Saudi Arabia. The age of the potential target market also varies from 16 to 60 year old, because my business offers body, skin, and hair care for all ages. According to the Central Department of Statistics and Information of Saudi Arabia, the growth of import goods composed 8.09% for the year 2013, which implies that the number of imports to the country keeps growing, and the products that I would ship to Saudi Arabia would be categorized as imported goods (Cdsi.gov.sa).
In addition, I did a research on the population of Saudi Arabia. The age structure of the country showed: approximately 2.5 million women are in the age range from 15 to 24 years, 5.3 million women in the age range of 25-54 years, and approximately 555 thousands in the age range from 55 to 64 years. Those findings show that in total there are approximately 8 335 000 women in the age range from 15 to 64 (Cia.gov). The research of the population census gave me a clue on the average women population in the country for the age range of my potential target market. There are big prospects for the business developing in this industry.
What is even more, it is a wide known stereotype about Saudi Arabia, that women like to take care of themselves and want to always look beautiful and with wonderful makeup, because most of the residents of Saudi Arabia are Muslims. As the result, those conclusions helped me to come out with the description of the potential target market.
It is important for every business to describe the marketing mix, because it would contribute to the development of the company and would give clear implications on what has to be done for the improvement. The traditional marketing mix consists of 4 P’s, which are price, product, promotion, and place.
The first element of the marketing mix is price. It is essential for the business to set that price that would be attractive to the potential customers, that would include all of the production and operational costs, and that would help you to generate profits from your business. It was a challenge for me to set the price in a way that I can gain a large customer base and at the same time make profits. The big issue was the shipment costs, because shipment from United States to Saudi Arabia is a very expensive operation. Moreover, the beauty products that I offer to the customers are of high quality, and the price varies from average to below average on the beauty products market and depending on the usage (whether makeup, or skin, body, or hair care). Therefore, the decision was to add 80% of the initial price of the product. This addition includes the shipment expenses, which takes approximately 40% of the price, and another 40% constitute the revenue from the product. This price installment helped me to calculate everything in a way that 40% of the product price would go for the administrative and operational expenses and what is left would actually constitute the profits of my business. All of the prices are calculated according to the exchange rate of the U.S. dollars to the Saudi Riyals.
The next element of the marketing mix is product. As it was described in the introduction, my business offers both services and products. The type of my business is business to customer, and it involves direct interaction with the customers. The main service that I provide is the assistance in the beauty product choice. My business offers a vide range of beauty products that are available in the United States and are not available in Saudi Arabia, such as, for example, makeup tools by Anastasia Beverly Hills. The products mix of my business includes makeup essentials and makeup tools, skincare products, such as creams, moisturizers, and facial masks, body care products, such as lotions and scrubs, and hair care, such as shampoos and conditioners, and various oils.
Another part of the marketing mix is promotion, which is one of the most influential aspects of the business. Well designed promotion helps to attract more and more customers and contributes to the creation of good business image in the market. As far as my business is still in the beginning stage, the main promotion tool for me is social platforms, such as Facebook, Twitter, and Instagram. Instagram gains its popularity very fast and there are millions of users currently. The main platform for my business is Instagram page, so that the potential customers would be able to view the products that I offer and would have an easy access to contact with the supplier (me). The name of the Instagram page is Shop_by_Duaa. The main purpose of the Instagram page is to create a base of the loyal customers and to introduce the business to the beauty market of Saudi Arabia. Because the main target market of my business is located in another of my residence country, World Wide Web is the most effective way for me to build my business and its promotion.
In future, I would try to cooperate with beauty and fashion bloggers on their blogs or their YouTube channels, so that they would promote my business in their posts and videos.
The last but not the least element of the marketing mix is place. My business is operated online, so this element would be best described by the WWW as the main place of my business. In addition, it would be important to mention here that the business works in the channel United States – Saudi Arabia.
Opportunities: One of the main opportunities for my business is expansion. For the moment, the business is operating with not a big number of customers, who show loyalty to the company. Still, there is a big room for further expansion. First, the business can attract more and more customers. Second, the business can expand the number of products that are offered on its Instagram page. Further, if the business shows successful performance, we can arrange some agreements with local beauty stores in Saudi Arabia to provide the production of United States to their locations.
Threats: The main threat for the business is competition. Competitiveness in the beauty industry is extremely high, and other people who would want to arrange the supply of beauty products that are missing in Saudi Arabian market represent a huge danger. Moreover, legal regulations changes can also bring a potential threat to the company. In addition, local producers of beauty products in Saudi Arabia may develop new products and new ways to manufacture cosmetics, so there would be no big need for the American beauty production in Saudi Arabia.
Strengths: The main strength of the business is its uniqueness. The purpose of the business is to satisfy the unmet needs. There is no business in Saudi Arabia that offers high quality beauty products produced in United States. Therefore, there is a big plus for entering this particular industry in this country. Moreover, another strength of the business is low production and initial costs. As far as the business is operating mainly on online social platforms, the operating costs for the business are not high. This, in turn, brings higher profits that would be a good investment in the business in future.
Weaknesses: The most important weakness of the business is shipment. It is very costly and quite hard to organize effective shipment with low costs. Moreover, various complains can occur, because the shipment is provided by another company (FedEx), and therefore there is a lack of control over shipment for my business.
There is no specific title of the business, though currently it is named by its Instagram page, which is “Shop by Duaa”. The business exists on the market only for a few months, but it already has its loyal customers who keep making orders for purchasing the products that we are offering. Moreover, the business has encouraged me to go for the makeup classes, because it is important for me to become a true professional in the industry my business is being built now. Therefore, I work hard on my idea, because it is my passion, and passion is extremely important for the future success. I contribute a lot of time to the business, and always search the web and update the news about my business on social platforms. It also helps me to develop good time management skills, because now I have to combine work and studies. Overall, as it was mentioned above, there is a big room for the expansion of the business, and in future, more assets would be invested in promotion and expansion of the business.
"Latest Statistical Releases." Central Department Of Statistics & Information. Web. 2 Feb. 2015. <http://www.cdsi.gov.sa/english/>.
"The World Factbook." Central Intelligence Agency. Central Intelligence Agency. Web. 3 Feb. 2015. <https://www.cia.gov/library/publications/the-world-factbook/geos/sa.html>.
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