March 12, 2014: Beauty
I confess I am a beauty product junkie. And apparently I am not alone. Despite the fact that makeup is readily available in numerous outlets, IBISWorld, a global industry and business intelligence firm, reports the economic recovery still underway will be a “most powerful driver” for the beauty, cosmetics and fragrance store industry. In fact it predicts industry revenue will grow at an average annual rate of 5.2 percent, hitting nearly $17 billion by 2018.
Now the bad news. IBISWorld says the industry is dominated by four major players (Sally Beauty Supply, Ulta, L Brands and Sephora) and “smaller players will have a hard time establishing themselves.”
Of course those are fighting words for some entrepreneurs. If you’re a bit more cautious, think about targeting the niches: Both aging baby boomers and the younger tween set are particularly ripe targets. As we’ve mentioned before, sales of male grooming products and services are booming and still at the beginning stages.
The Web is a cheaper place to start, or consider selling from kiosks or carts in other business locations. Or if you have a complementary business (selling clothing, accessories, spa products, etc.), consider adding makeup or other beauty products to your shop.