You Need Dedicated Staff and Continuous Investment
From offline to online, the beauty supply business
In the U.S., more than 33,000 beauty supply stores are running according to ibisworld.com. Many of owners running those beauty supplies wish to have online retail presence beyond their brick-and-mortar stores. There are many good reasons to run an online store, including a desire to expand preexisting business, hopping on the online shopping trend, and a challenge for a new achievement. As such, BNB Magazine wants to relay practical tips and operational know-how to readers who are thinking of online beauty supply stores.
The advancement of the internet enabled online shopping, and the emergence of smartphone in 2007 accelerated the growth. As shown on [Chart 1], the U.S. e-Commerce revenue surpassed 431.6 billion dollars in 2020 and is estimated to be 469.2 billion dollars this year. With continued growth, it should reach 563.4 billion dollars in 2025 according to the prediction. In this circumstance, there is no doubt each and every beauty supply owner wants to have a foot in the door to online retail. Nonetheless, if you start without knowing the basics of how to open and operate, it may put you in a no-exit situation.
A beauty supply business owner in New Jersey spoke frankly that it was a big mistake to start an online shop upon hearing words about the online shopping being the next big thing. Business owner K who experienced a failure recounted, “I thought if you simply have a well-made homepage, you will receive a lot of orders because there is more than enough inventory with the store.” When the online store opened, the time waste and lackluster revenue led to the de facto closure of the online shop. As you can expect from your experience, when you start a business without proper preparation, failure is almost always guaranteed.
You think about it. How much time and effort did you put in for the beauty supply retail store you run now? You need the same amount of time and effort in preparation of an online store.We need to listen to a frank opinion of a business owner C who runs a successful online beauty supply, started four years ago, in addition to a small beauty supply shop in Philadelphia. When asked for an advice to readers who are considering online business, he emphasized that “it’s better not doing it if you are not going to do it right.” A follow-up advice: if you are still in for the online store despite that, you need to consider it as a main job, not just a side job. That is to say you shouldn’t be just doing it for an extra money in addition to the main beauty supply business. You need to think of the online store as a separate business entity.
If you run a beauty supply store with your spouse, it’s often better that the wife runs the offline store while the husband runs the online store. In fact, that is how the business owner C runs the businesses. If running out of human resources, you must hire a dedicated employee for the online store. Unless someone takes charge of the online store, at some point the store might not be running as it should, according to the business owner C.
To run an online store, you must invest continuously. Not just till the online store finds its traction but also for the entire duration of the business operation, you should keep the flow of investment for promotion, product updates, upkeep for the website, and so on.
When creating a website, unless you have a talent in computer, you’d better find a professional. Customers don’t just pour in to your website just because you created one. You need to promote the site. For the publicity of your website, you should consider investing in social media advertisements, Search Engine Optimization (“SEO” which ensures your website to get ranked high on search results), and so on.
Lastly, you need to offer a wide range of products and manage the inventory efficiently. The inventory management touches on the adding a variety of new products periodically. You need to upload a new product that others don’t have and make sure they are indexed by internet search engines upon promotion. When consumers are confident that they can find an item they saw on advertisements at your website, the website is fully functioning. For this to be your case, you must have a wide range of products, especially new and unique products, in addition to rigorous inventory management.
As consumers expect to buy items at a cheaper price at online stores than offline, it is important that you purchase hot items at a great quantity by cutting a good deal with wholesalers. Once you offer an item at a discounted price and run advertisements, all consumers looking for the item will start to flock in to your website. A continued effort for SEO must precede it to make the discounted items visible to consumers.
Even though discounted items do not generate a lot of profit, they can be loss leaders that bring business to your website. For example, if you sell the popular lace wigs of a recent boom, customers who put the lace wigs in the cart may purchase sprays and glues at the same time. Creating a package is a good idea too. In doing so, you can balance out the profit margins.
Simply by shifting shipping cost for those items to customers, you can reduce the loss from discount while having positive impacts on the website while promoting the website and generating revenues. When you see a trending item, you should move aggressively and purchase a great quantity of them as a long-term investment. Even if you are left with a lot of inventory in the end, you can transfer them to your offline store.
To summarize the advises from the business owner C who runs successful online and offline beauty supplies:
First, you need a dedicated employee for the online shop.
Second, continuous investment is a must. Especially, you need to invest in various aspects of the business including building and maintaining your website, updating products, promotion on social media, and SEO. You should not try to handle everything yourself but to find a decent company who can run promotion, update the product list, and process online orders for you.
Lastly, a great product listing and inventory management are essential. Inventory management doesn’t mean that you simply buy moderate amounts and keep a safe inventory level, but rather you should find an item that consumers want to buy online and offer it at a great price. You can use it as a loss leader, and that should be a part of inventory management. Offering a variety of products, new products, and unique items can greatly satisfy the consumers from all over the country, and that should be the goal of your online beauty supply store.
While the business owner C’s experience and advice cannot be the answer for a successful launch and operation of online beauty stores for all, if you don’t put as much effort and time as you did for your offline retail store, it is virtually certain that your online venture will not succeed. Promote continuously, respond to customer inquiries kindly, and offer items they look for at a good price when they look for. If you can keep doing so, at some point your online store will be visited by many consumers just like your offline store.