Your Home Based Cosmetic Business

To take advantage of the advice presented here for many other similar products, just substitute jewelry, lingerie or perfume for the eye shadow box example. The procedures described here have all been "tried and tested," but that doesn't mean they can't be improved or adapted to fit your particular situation.

There are three basic objectives in starting a mail order home based cosmetic business:

• Find a product that you can sell at a profit
• Sell additional products to the same buyers
• Build a mailing list of customers

imperative to strive to achieve all three simultaneously, but your first and perhaps most critical initial consideration when starting your home based cosmetic business is to find a product that you can sell at a bargain price - preferably $2 or less - and still make a very good profit.

Small Inexpensive Ads

To illustrate this point, I will use a 10 section eye shadow kit to sell for $3.00 plus $1.00 Postage and Handling. These were advertised recently for $1.99 at Rich On, Inc. (see Business Sources). Although you will "gross" $1.00 apiece on these items, your overall profit will not be significant on this sale alone, when you consider the cost of advertising, your time and effort to obtain, process and sell them.

Your real profit will come from subsequent sales to the same customers who are your captive audience!

The smart way to proceed with your home based cosmetic business, would be to purchase an initial supply of say, 250 units from a company that can ship up to 5,000 more on short notice if necessary (don't make the mistake of buying the last 250 they have). With an investment of $500 in stock, place your ads and wait for orders to come in.

Using Drop Shipping

The advantages of drop-shipping in your home business is that you don't need to invest in merchandise until it is sold, and you don't have to worry about it running out. The disadvantages are that the merchandise costs much more - there are no volume price breaks, it takes extra time and postage to forward the orders to the supplier, and the supplier gets all the postage and handling fee which is usually part is profit.

Most mail order dealers stock their good sellers and use drop-shipments for slow movers and new, untested items. It would not be wise to attempt a mass mailing at this stage because of the cost, your inexperience and the fact that there is a better way.

Ads In Publications

Normally, test ads are run in three consecutive issues. If you receive a thousand orders or queries, your cost per reply could be about 2 cents each. Compare this to $50 for a thousand name mailing list, $100 for stationery and printing, plus $250 for postage for a mass mailing. Mailing list responses can easily cost $2 to $4.00 each.

Many mail order companies use small ads as an effective and inexpensive means to find prospects for their line of products. Part of the reason is that so many mailing lists on the market today are pretty well used, especially those available from some small companies.

The industry thinking is to use small, direct sale ads for items up to about $2.50; inset one or two inch ads, with a little more sales information for items up to about $5, and a quarter to full page ads for items over that amount. The larger ads are needed for the additional "sell" that is needed to encourage people to part with larger sums of money.

Why Use Small Inexpensive Ads

The suggested system combines the best of two worlds; responders to ads offering the eye shadow box for $3 not only contribute a dollar profit each; they also become valuable prospects for future sale of similar merchandise!

It would be shortsighted - even foolish to be satisfied with a $3 sale here. In fact, the mail order sales door has just been open with that first sale! Remember when you made the deal for 250 eye shadow boxes, you considered many other possible products from the same as well as other suppliers?

Offering Other Products

Wouldn't a customer who paid $4.00 for an eye shadow box also be a good prospect for bargain priced lipstick, nail polish or costume jewelry. The answer is yes!

In fact these particular customers would be considered by any mail order broker to be the "hottest" in the industry for your products right now. You simply could not buy a mailing list anywhere near as valuable to you as these names who have just bought a $3 eye shadow box from you! It is very important in your home based cosmetic business to keep careful records of each name, along with what and when they buy anything.

Their name and addresses are your own private mailing list. If you use that list wisely, it can be the key to your success in mail order.

A good way to help insure full utilization of your customer names - short of a computer record - is to write each one on a separate card and record all transactions involving that name ( i.e., when you mail them flyers, when and what they buy, and other pertinent correspondence).

Although your master file should be alphabetically by last name or zip, you can place some of the cards into temporary "suspense" files -- like those that you want to send reminders or repeat offers in a couple of weeks.

Your Mailing List

Looking ahead to a possible next stage in your home business, note that some companies will imprint their products with your name or brand. This opens the door to marketing your own line of products -- not from a huge initial investment and risk situation, but as a natural, relatively inexpensive continuation of your current successful venture. You already have the customers and all the facilities in place, so simply add your line of items to your flyers when you are ready for this step.

Using Flyers

When there is no response, wait a couple of weeks and send out another batch of flyers, and again at six weeks. When there are responses, start the same cycle over again, until you run out of products. You don't have to, you know.

After 6 months or so... depending on how long the products last, contact them again to see if they need replacements.

When there are lulls -- periods of no response, you can occasionally send out another offer, something that mentions you haven't heard from them for a while and are making a special offer to regain them as customers.

Preparing Cutomer's Information

Periodically you have the option of gathering these names into groups of 1,000 and selling them to a broker, or offering to rent them yourself -- to non-competitive operations of course. Many mail order oriented companies routinely exchange names with non-competing businesses.

In the above paragraph, I used the words "sell" and "rent" with mailing lists. Names on a rented mailing list are to be used for one mailing only by the renter. The only exception is that anyone who answers the one mailing also becomes the property of the mailer because that person corresponded to him.

Selling Your Mailing List

After you get started in your home based cosmetic business, take an hour or so every few weeks to look over your system carefully. Check your supplies and prices; your forwarding procedures, packaging and systems for telling when to mail out what. Also check your financial records to see how you are doing; learn which particular products are the most profitable and which are not -- then try to figure out why. Is it advertising, marketing or is it the product quality or appeal.

These little think sessions, held befor any serious problems develop can keep you from continuing inefficient procedures and often help develop profitable ones; this is where many highly successful business people make some of their secret discoveries that make them rich.

Using Letter Head Paper And Envelopes

When writing to customers, letterhead gives the impression that you are a reliable company and they don't have to ever know that you are running a home based cosmetic business. When writing to suppliers, you may not even get an answer unless you use letterhead. They figure all legitimate businesses have their own letterhead, and within your state you will have to give your tax number if applicable.

An easy way to make a logo for your home based cosmetic business - if you have art talent - is to make it double or more indesired size and have it reduced by a copy service to the desired size: it will look much more professional.

Flyers can be produced by copy services, printers or desktop publishers. They need several different styles and sizes of print, underlines, borders and other embellishments. You can also design your own with rub-on letters from any stationery store, and perrhaps a paste on logo.

One way to save on flyers in color is to have them printed on colored paper, which is almost as effective as two colors of ink, but a lot cheaper!

And, don't overlook clip-art for your flyers and advertisements -- these are copyright free illustrations that are used to dress up your copy. Just cut them out, glue them on and have them copied. You might have to erase the paper edge lines on the first copy to get a clear "master".

As you can see, it does not take a fortune or any special training to get into the mail order cosmetics business. With a little study and planning, you can minimize your risk and have a real chance at a very rewarding business. Good luck!

Some Business Sources For Starting Your Home Based Cosmetic Business:

Rich On, Inc.
3051 E. Washington Blvd
Los Angeles, California 90023
Tel: (323) 881-0805
Fax: (323) 881-9765
Toll Free: (800) 826-2670
http://www.richon.com/

FragranceWholesale
CFL Inc.
PO Box 358
Pebble Beach, CA 93953
877-576-7337
http://www.fragrancewholesale.com/cosmetics.html

Make-Up USA
4841 W. Milett Road
Fowlerville, MI 48836
Fax: (517) 545-7662
Toll Free: (888) 426-5673
http://www.make-upusa.com/wholesale.htm

Michelle and Scotts Wholesale Imports
4957 Summer Ave
Memphis, TN 38122
Tel: (901) 767-0838
Fax: (901) 843-2498
http://www.wholesaleimport.com/

Cosmetic World
16 East 40th Street, Suite 700
New York, NY 10016
Tel: (212) 840-8800
Fax: (212) 840-7246
http://www.cosmeticworld.com/