This is one of the most frequent questions we get from new customers and curious people. This may vary depending on the kind of business you’re thinking of building, and more importantly, the industry you want to be part of. So for the sake of this blog and the title, we’re going to focus on the makeup industry, which is the one we’ve been on for the last 15+ years until we became one of the biggest wholesale makeup distributors in the US.
Digital vs traditional business:
Traditional marketing, or offline marketing, focuses especially on sales and action channels through conventional methods or channels. Direct sales, sponsorship, the press, radio, television or fairs and exhibitions are some of the most common channels of this type of marketing to achieve its objectives.
Instead, digital marketing uses the techniques most closely related to the digital media and the Internet to develop a more direct and personal type of communication with users. In this case, the action channels are all those found on the Internet and social networks: search engines, e-mail marketing, chatbots, exclusive and segmented ads. For this exact type of niche, we suggest you start your business on digital/ online, since you will save tons of money on expenses like renting a store, hiring people to run or take care of the place, etc. Also, there are more modern tools to push your marketing strategy and online store forward with fewer resources and probably better results. After your business takes off, you can think about starting your traditional store to have both and complement the business model.
The budget entry threshold:
The entry level threshold for every business idea and industry is different. In Silicon Valley, for example, most people couldn’t afford to drop a startup project without having 50k USD (or more). In fact, data says that just the US, most businesses, no matter the industry, start with an initial investment of 10k. But wait! Fortunately for this case, you don’t need this huge amount of money to start making a profit, in fact, not even close.
With Wholesale Makeup you can find mixed boxes full of products you can sell for as low as 80 dollars. Each product on this boxes has an average price per unit of around 1.50 USD to 5 USD so you can sell it for double, triple and sometimes even more times the original cost so the profit margin is huge. Check this example out from our website:
In conclusion, you can definitely start your makeup business online for a very low budget and start scaling from there. You can easily start from 80 USD-150 USD as you can see in the example (mixed box above). Nevertheless, we recommend investing more in the product to sell per se since the more you buy at once more you can reduce the original price per unit and make more profit once you finally sell it. Also, take into account that buying the product is the first step when you invest but depending on what you are planning to do with your business in terms of logistics, marketing, and business plan it can increase your budget (but could increase sales)
Here is an example budget you can have as a reference:
Budget for the product: Wholesale Makeup mixed box (150 USD)
Shipping costs: 35 USD
Marketing: 100 USD
Packaging and branding: 15 USD
Total first investment: 300 USD
IMPORTANT: Be always aware of our website promos, we are always updating the thresholds and specials offers after buying certain amount of products. (eg. Get a 50 USD discount or coupon if you reach 250 USD on the cart)
Also: Check more of our mixed boxes here.
There are more industries but this one (makeup) is one of the top growing industries for the next decade, also makeup and cosmetics are a commodity, this means that is something most people (women especially) need for their they to day normal lives so there is always going to be a market for it, you just need to figure out how you want to show your brand and your exclusiveness to the worlds to outrange your competitors. That is why on this blog we give you some tools you need to take into account to have a good scope and build a good business ecosystem so you can sell the makeup and cosmetics to your defined niche. To recap you need:
- Strategy: A defined niche, buyer persona, distribution channels like social media or in-place store sales, and the way the business will start operating.
- A good distributor: You need to find a good and reliable company where you can buy your products for a good price compared to the minor general marketplace so you can have a higher profit margin.
- A defined initial budget to start operating: You need more than the initial money to buy the product, you need to take into account how you going to send it to your end customer, will they pay for it, or will be a cost you need to include into the budget to offer a free shipping? Or maybe the packaging with your branding containing the products so you can add a good experience when your customer gets the product. We recommend and encourage you to have these topics and others In mind, especially if you want to scale up fast and smash your competitors, nevertheless, if you are just trying out something easy and with a good return, more like a side hustle and then see what happens, this is also one of the best options. So it’s up to you!