With the employment market in its current unpredictable state, jobseekers have been encouraged to think about setting up their own business instead of working for another company. One sector that could prove particularly profitable is toiletries.
Research by Key Note suggests the UK toiletries industry saw sales of £4.5 billion in 2010, with this forecast to grow by nearly ten per cent by 2015. In spite of the economic crisis, sales remain fairly strong, pointing to opportunities for sole traders and small firms who can carve out a niche in the market (especially in the ethical/green segments). So, what do you need to do to take advantage of this growth?
The first thing is to decide on what you want to sell, be it just one product range to begin with (e.g. shower gels) or several. This decision may be based on whether you already dabble in homemade toiletries or on your vision to fill a gap in the market.
Then you will have to think about how you’re going to manufacture these goods – it’s likely you can’t afford to outsource production just yet, and, indeed, you might want to retain control over the process so you can make sure output meets your standards and requirements. Don’t forget that you should comply with the relevant manufacturing and labelling legislation, too.
If you do decide to make your own toiletries to sell, you will need to invest in the necessary ingredients and equipment, such as bottles/tubes/jars, a labelling device and a lotion filling machine, so ensure you budget adequately for these things.
Next comes the slightly tricky part – deciding on prices and retail outlets and making sales projections so you can get a good idea of where your business will be in a few months or years. This is especially important if you intend to take out a bank loan to finance your venture, as most lenders will need to see a business plan before they make a decision.
Finally, you will have to invest in some kind of marketing campaign to ensure you get the word out about your products. This doesn’t have to be complicated or expensive; you just need to ensure you choose the right channel. If you’re selling online, it makes sense to take advantage of internet advertising, but if you’re setting up shop at your local market, you’re probably best off focusing on the regional press.
If you achieve success within your first year, well done! Once you’ve established your business, identified the most successful products and built up a loyal customer base, you should consider expanding to grow sales further. This could be done by launching new products, hiring more staff, investing in new machinery or spending more on advertising.
However, if you’re still struggling to achieve your target sales within the same timeframe, you may need to take one of several courses of action. These include changing your product line (and possibly even withdrawing certain items from sale), rethinking your marketing strategy, taking expert advice and, in drastic circumstances, cutting your losses and winding down your operations altogether.
Wherever you find yourself in 12 months’ time, don’t forget that it takes much hard work and perseverance to make it as an entrepreneur. Keeping an eye on both your target market and the wider economy and making the right decisions accordingly could do much to ensure you’re eventually rewarded for your efforts.