How to Start a Cosmetic Distribution Business
Become a Cosmetic Distributor
In a business, the process of distribution of goods and services is as important as its manufacturing. While beauty businesses in India are one of the biggest contributors in the GDP of the nation, starting a distribution business could be a rewarding one. For those who have a knack for cosmetic and beauty products, starting with a distributorship comes with a wider income possibilities as these products are likely to remain in demand since forever and beyond.
If you wish to start a cosmetic distribution business, then follow these guidelines to make it a successful one.
Choosing a Product
The first and foremost step to start with the cosmetic distributorship is to decide the product that you will be distributing. While choosing the product, one should do a thorough research in the beauty industry and find out the most demanded product category. The higher the demand of the product, the more will you sell the product. And the more you sell the product, the more profit will you make profits as a distributor.
Another parameter to choose a product is to see whether it is relevant with your current occupation or business. Your knowledge about the product and its life cycle also adds to your candidature.
Conducting Market Research
By conducting market research, you can find out specific details about the product that you have chosen to distribute. Market research will help you find out all the statistics regarding the product’s market and distribution chains. It can also help you in analysing the market competition so that you know how competitive the market is and how you can avoid the other distributors in ruining your sales. By conducting a thorough market research, one can help you sorting out companies of which you can become a distributor. For instance, if a lipstick brand is the most selling brand and it offers distributorship, then you can easily grab the opportunity as you would know how much revenue it is generating.
Understanding the Manufacturing and Distributor engagement model
After you decide what product and company you are going to take on for your distribution business, understanding the terms and conditions of their business is extremely important. Contact them for their distributorship and try gaining some insights about the distribution mode – what percent of margins are there for distributors, what revenue does the company generate, which location do they want their distributors to operate, what space requirements do they want – so that you know that it is a relevant opportunity for you.
Arranging Space Requirements
After all the above points, it is time for self evaluation. Arrange the area requirement that the company want you to acquire. The space requirements of a cosmetic product is usually 150 sq ft. So, you can lease the area or can buy a space to make it a warehouse from where you can start distributing your goods.