Starting a cosmetics business in Kenya

Cosmetics businesses are becoming very popular among Kenyan women as well as men who like to look good all day long without having to worry about breaking the bank.

If you are looking for a venture that doesn’t require much capital and has the potential of becoming very lucrative within a short amount of time,then this might be it.

This blog post will help people who want to venture into this type of industry by providing them with some basic information on it as well as tips on how to get started.

Develop a cosmetics business plan

The first step in starting your own cosmetic company is to develop a business plan. This will help you define the goals and objectives of your company, as well as establish what resources are necessary to be successful.

Below are the key items that should appear in your cosmetics business plan:

Your goals and objectives

Define what you want to accomplish with your cosmetics venture. For example, is your goal to generate extra income on the side or do you want to start a small scale beauty brand?

Your goals and objectives will help you determine what type of business structure (e.g., sole proprietorship) suits your needs.

Determine what products to sell in a cosmetics store.There are a wide range of beauty products that you can sell some of them include;

  • Makeup products such as eye shadow,mascara,foundation ,lipstick
  • Hair care Products such as Shampoo ,Hair oils,Hair relaxer,Hair treatment
  • Skincare Products e.g. soaps, creams and perfumes
  • Personal care items like body lotions, bath oils
  • Hair products like wigs,weaves and braids
  • Hair accessories such as headbands and wraps
  • Nail care kits such as buffer, nail file ,nail polish
  • Kids accessories such as beads and hair clips
  • Fragrances such as perfumes and colognes
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When starting this venture you ought to have enough knowledge of beauty products so as to be able to advise the customers accordingly and also be able to deduce customer challenges and offer solutions.

You also need to keep up with beauty trends.Check what is happening in the market, what are others doing, what is ‘hot’?

Your target market

To develop a business plan, you’ll need to identify your target market and the different types of products that they would be interested in purchasing from you.

For example, if your company is going to sell makeup for women who are looking for natural beauty products then it makes sense that this segment would prefer organic products , as well.

Are you targeting middle and high end customers or low end customers ? We recommend you target middle and high end customers as they have a high spending power which translates to higher margins and high turnover though they are more demanding in terms of variety, quality of products and customer service.

Research and analyze competition

It’s important to know what your competitors such as Bestlady are doing and how they’re fairing in the market.

This will help you identify where they’re coming up short in their marketing plan, and how you can improve on it.

Analyzing the competition’s products as well as their strategies can give you a better idea of how they handle issues such customer service, pricing policies,return policy and how you can improve your own company.

Determine type of cosmetics store

Do you want to sell exclusively online or do you want a brick and mortar store as well?

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This will help determine the necessary expenses for starting your business such as inventory and website development costs.

Several beauty shops such as Bestlady have physical locations where they sell their products. But majority of them have an e-commerce site that sells the same items for a cheaper price than what you would buy at the store or online through other retailers like Jumia.

Jumia provides delivery services around the country to make it even easier for their customers to get their products so you can opt to sell your beauty products through them.

Identify a suitable location

If you have decided to have a brick and mortar store,you need to identify an ideal location to set it up;Look for locations that ;

  • Are densely populated. Areas where there is a large concentration of salons are ideal as customers are more likely to buy.
  • Have high traffic .Areas known for cosmetics such as Dubois Road have high foot traffic of the right kind of customer.
  • Have less competition.Areas where there are not many beauty shops are ideal as you will not compete on price.

Determine funding needs

This is important as you will be able to develop a budget that can be used to run your company throughout the year.

The higher your funding needs, the more you will have to fill in requests for loans or other financing options.

You also need to be aware of what type of structure is best for your company and how much capital you would require as initial start up.

Below is a table of how much investment you need to start a cosmetics shop in Kenya.

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Cosmetic Store RequirementCost (Ksh)
Licenses 
Single user permit10,000
Signboard License5,000
Fire Inspection Certificate3,000
Conservancy fee(Waste management)2,000
Sub-Total20,000
Equipment 
Furniture30,000
Fire extinguisher5,000
Sub-Total35,000
Stock 
Beauty Products Inventory50,000
Premise 
Rent (1 months’ rent and Deposit)40,000
Renovations25,000
Sub-Total70,000
Employee wages30,000
Total200,000

The above figures are just guidelines. Specifics could vary.

  • For instance the amount of rent you pay will depend on your location and the specific building you are operating from.
  • Licenses will depend on the county and the size of your premises.
  • Renovation will be based on the present status of the premises.
  • The amount you pay your employees will depend on what you have negotiated with them.
  • The amount of stock could differ depending on your budget.In highly competitive markets ensure you have a variety of items as this could be a way of differentiating and attracting customers.

Identify cost of goods

You should also identify your cost of goods before completing the rest of the business plan.You’ll need to do some research in order to get accurate information on how much each product will cost.

This is important because the price you set for your products should be low enough to ensure that you can make a profit, but high enough so that customers are still willing to buy them at this price point.

Identify where to buy cosmetics in wholesale

To be profitable in this venture, you ought to buy your products in wholesale.

In Nairobi the major distributors and wholesalers are found on the upper side of River Road, near the junction with Latema Road. Another major concentration of wholesalers is along Dubois Road,Nairobi.

Below is a table of a list of wholesalers of cosmetics in Nairobi and their location

Cosmetics WholesalerLocation
Gawa Nyakio House River Road
Euro Market Mansion Building Tubman Road
East end ChemistTom Mboya Street
Diana House of BeautyUganda House Kenyatta Avenue
Cosmix Perinda Center 2nd Dubois Road
BestMan Nyakio House River Road
Bestly River Road
Best AfricanNyakio House River Road
Beauty OptionsEagle House Kimathi Street
Sarah BeautyNyakio House River Road
Super CosmeticsReliance Plaza Woodvale Road

Identify your pricing

If you are able to source intelligently then you will enjoy higher margins or have room to offer a variety of prices and if need be compete on prices.

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