Target Market and Location
I cannot stress enough the importance of identifying your target market. Concerning a beauty supply shop, your target market may include industry professionals such as cosmetologists, nail techs, estheticians, salon owners, and even beauty school students or a shop might target the consumer directly, or perhaps a shop caters to both industry professionals and consumers.
Concerning location, check out the businesses around the store. Check to see how many salons or beauty schools are nearby and also what other shopping destinations like grocery stores and shopping malls exist near the store. The more conveniently located the greater opportunity of building a loyal customer base. A hair stylist may stop on his or her lunch break to pick up some needed products or someone doing their grocery shopping may stop to pick up a shampoo their grocer may not carry.
Inventory is a beauty supply shop’s greatest operating expense. From what I have seen in the past, the most successful beauty supply stores keep up to date on the trends and stock popular items accordingly. Customers want to buy the latest beauty products. The beauty business is extremely trendy which means inventory is constantly changing. For example, blue nail polish may be hot for spring but will be out of style come summertime. Don’t pay full price for items that won’t be popular in a few months. Old inventory will have to be sold at a discounted rate anyway if you cannot get rid of it. Also, inventory must be managed and kept track of to ensure employee theft is not taking place.
Product knowledge is paramount in the beauty supply business. Customers will ask questions and want your input. This is a great chance to make recommendations and increase your sales. Knowing what you’re talking about will make you an expert in your industry and in turn will build up your trust and credibility with customers. Providing exceptional customer service is imperative as well. Product knowledge paired with more personal customer service will help you to compete against the large retailers.
Beauty supply stores that target industry professionals are generating additional revenue by selling salon equipment and design. Check to see if the store you are interested in caters to this market. If so, you’ll need to educate yourself on the trends. If not, you may want to consider this option when you take over.
Examine the current owner’s marketing plan. Is the business utilizing any social media (blogs, YouTube) or participating in any social networking (Facebook, Twitter, Pinterest)? If not, you will need to add social media to your marketing strategy. Social media is a valuable tool that allows you to not only sell your products but show yourself to be an expert in your field.
According to IBISWorld, beauty supply shop owners will have to rely on introducing new products to stimulate store sales in the next five years. Competition from discount stores like Walmart and drugstores is increasing so although revenues remain strong, the organization expects competition in the beauty supply shop market to increase.