Drippy Lips Cosmetics Business Plan PDF

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Group business plan. Final assignment...

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Drippy Lips Cosmetics Business Plan Submitted to: Hyacinth Campbell, Professor, Humber College

Submitted by: Nardia Ennis Crystal Morgan Princess Amanquah Uwaila F. Iyobosa Louise Simon Faith Ojei Glory Obatayo

April 7, 2020

1 Running Head: Drippy Lips Cosmetics Business Plan

Table of Contents Executive Summary........................................................................................................................3 Section 1: The Business Model......................................................................................................5 Business in the area that is similar.......................................................................................................5 Define your business..............................................................................................................................5 Location................................................................................................................................................. 5 Target Market........................................................................................................................................5 Product and Service.............................................................................................................................. 5 The Customer........................................................................................................................................5 The Location.......................................................................................................................................... 5 Advertisement........................................................................................................................................6 The Opportunity....................................................................................................................................6 The Owners............................................................................................................................................6 The Legal Organization........................................................................................................................6

Section 2: Feasibility......................................................................................................................8 Location Analysis..................................................................................................................................8 Site Analysis........................................................................................................................................... 8 Market Potential....................................................................................................................................8 Competition........................................................................................................................................... 8 Protecting the business.......................................................................................................................... 9

Section 3: Marketing....................................................................................................................10 Image....................................................................................................................................................10 Business................................................................................................................................................10 Service/Product Mix............................................................................................................................10 Pricing..................................................................................................................................................10 Distribution..........................................................................................................................................10 Promotion............................................................................................................................................10 Promotional Evaluation......................................................................................................................11

Section 4: Operations...................................................................................................................12 Space and Equipment......................................................................................................................... 12 Logistics...............................................................................................................................................12 Methods and Procedures....................................................................................................................12 Systems................................................................................................................................................. 13 Organization........................................................................................................................................13

2 Running Head: Drippy Lips Cosmetics Business Plan Regulation............................................................................................................................................ 13

References.....................................................................................................................................14 Appendix.......................................................................................................................................15 Appendix A: Drippy Lips Cosmetics Products & Pricing................................................................15 Appendix B: Drippy Lips Cosmetics Competitive Pricing...............................................................16 Appendix C: Drippy Lips Cosmetics Equipment & Furniture Costs..............................................17 Appendix D: Drippy Lips Cosmetics Floor Plan...............................................................................18 Appendix E: Drippy Lips Cosmetics Job Descriptions.....................................................................19 Appendix F: Drippy Lips Cosmetics Partnership Agreement.........................................................20

3 Running Head: Drippy Lips Cosmetics Business Plan

Executive Summary Section 1: The Business Model Drippy Lips Cosmetics is a cosmetic company that offers lip glosses and scrubs. Our products are made with natural ingredients, essential oils and vitamins. All our products are natural and vegan friendly, and have low, affordable prices. Our target market is women ages 16 - 45, who are open to natural ingredients. Our products are moisturizing yet exfoliants that do not cause skin irritations. They would also be suitable to those interested in lip products that actually work by helping remove dead skin, plump, brighten and hydrate. At drippy lips cosmetics we are offering a variety of lip products such as; Exfoliating lip scrubs, Moisturizing lip glosses, Plump lip glosses, Lip brightening lip scrubs with the scents as followed: lavender, peach, strawberry, unscented, Coconut, Vanilla, and mixed berry. In today's day and age, everyone is looking for a quick fix that calls for convenience, efficiency and with long term use overall healing to their lips. With the many external factors in the environment our lip products provide not only protection but a healing power to the public! The owners listed are the perfect individuals for the job as they have each surpassed job qualifications of each position at the same time and have the passion and drive it takes to run a full-time small business. Section 2: Feasibility Drippy lips cosmetics will be a home-based office based in Markham surrounding the population of 6,082,000 Million in the Greater Toronto area. Our company is an online based business. We chose to be based online because there is higher customer traffic. We want our customers to be able to shop with us at any time they want. Our domain is www.drippylipscosmetics.com The only expenses that will be covered in terms of the site are rent and utilities of the facility. We will also be maintaining cleanliness as per Canadian health guidelines by having periodic industrial cleaning completed. The percentage of the house that will be used exclusively for business purposes is approximately 75 percent at 50 square feet. The annual income spent on a household in Canada in 2018 is $86,070. In total, the average household spent $1,300 on personal care in 2017. So therefore, our total market potential is $26,000,000. Nearby competitors for drippy lips are Mac cosmetics. Our prices are directly competitive in nature; however, our products provide a much more moral, ethical stance in terms of ingredients, product testing and overall quality of life. At drippy lips cosmetics we can expect revenue of (26,000,000) In the next three years.

4 Running Head: Drippy Lips Cosmetics Business Plan Section 3: Marketing The image we would like to portray is professionalism, cleanliness and the idea of embodying your natural self, being your Own kind of beautiful. Our business is diverse to everyone that would like a plumping and nourishment to the lips. We take pride in ensuring our products are made in a clean environment and are made with natural products that are good for your lips. All products will be wrapped in tissue paper and put into a box imprinted with Drippy Lips Cosmetics logo. We will send a shipping confirmation and continue to ship with FedEx once the purchase is made on our website. The pricing strategy we’ll be using is penetration pricing because our quality is comparable to MAC cosmetics but will serve a much lesser price! Our price point is also suitable for our target market. (See Appendix B) We will be distributing the products out of our home station in Markham, Ontario. We will be using FedEx as a courier to ship our products to our customers’ homes. We are using them as they are a world renowned, trusted courier service. We have a contract in place with FedEx to supply our products to our customers. Section 4: Operations We will be buying and ordering our supplies from www.makingcosmetics.com. Crystal will check inventory and keep supplies and ingredients up to date with a first-in-first-out policy. We will store ingredients in a storage room and refrigerator. We will also be ordering clear plastic lip gloss tubes and containers to store our product in. For supplies, we will order measuring cups, dispensing spatulas, syringes/pipes, bowls, glass beakers, and spoons. We will also ensure we have safety goggles, gloves, masks, and a scale to ensure a safe working environment. (See Appendix C: Drippy Lips Cosmetics Equipment & Furniture Costs). Nardia Ennis is the founder and CEO of drippy lips cosmetics and Crystal Morgan and Princess Amanquah are the shared owners, along with Nardia Ennis. Our private investors are: Louise Simon, Uwaila F. Iyobosa, Faith Ojei, Glory Obatayo. All investors have the right to be a part of management if they choose to and will be at executive level of management. The reason for this legal setup is that it allows each owner to have equal say in the direction of the company and allows equal shares of profits. The private investors have a choice of being a part of the management team at executive level and will receive a 2.5% gross income annually with 0% interest on the loan. (See Appendix E: Drippy Lips Cosmetics Job Descriptions)

5 Running Head: Drippy Lips Cosmetics Business Plan

Section 1: The Business Model Drippy Lips Cosmetics is a cosmetic company that offers lip glosses and scrubs. Our products are made with natural ingredients, essential oils and vitamins. All our products are natural and vegan friendly, and have low, affordable prices. Drippy Lips will be a home-based company located in Markham, Ontario. Drippy Lips will be available to purchase online.

Business in the area that is similar There is Mac Cosmetics and Sephora located in the area of Markham, Ontario. However, the difference between our company and theirs is that our company is smaller and more focused on the ingredients to make sure that they are all natural and to satisfy our customers' needs. These companies also have very toxic ingredients that are not safe for our bodies. Many ingredients can disrupt hormones, cause cancer, skin irritations, infertility, etc.

Define your business Our business is a cosmetic company that offers a line of lip glosses and lip scrubs that are made with all-natural ingredients. Our products are made with essential oils, carrier oils, and vitamins.

Location We are currently located in Markham, Ontario. Our location will be home based. Our products will be available for purchase online.

Target Market Our target market is women ages 18 - 45, who are open to natural ingredients. They are interested in moisturizing and exfoliating products that do not cause skin irritations. They are also interested in lip products that actually work by helping remove dead skin, plump, brighten and hydrate.

Product and Service Our business is offering products not services. Our products are made with natural ingredients and essential oils that are extracted from plant sources. Our products are not made with any animal by-product. Our products are affordable especially to our target market. (See Appendix A: Drippy Lips Cosmetics Products & Pricing)

The Customer Our customers are women aged 16 - 45 and these are people that are interested in cosmetics made with natural ingredients that are simple and easy to use. Our customers enjoy online shopping and are easily influenced by others to purchase online. We are targeting groups of people from all over the world, anyone interested in affordable, natural lip products.

6 Running Head: Drippy Lips Cosmetics Business Plan

The Location Our company is an online based business. We chose to be based online because there is higher customer traffic. We want our customers to be able to shop with us at any time they want. Our domain is www.drippylipscosmetics.com

Advertisement We will be advertising on social media through Instagram, Twitter, and Facebook. It is easily accessible for our target market and more convenient. We also are offering free shipping on orders $50 and over. We will have a website to be easily accessible, and Uwaila will be managing the website.

The Opportunity Our customers will be more aware of the ingredients in our products and the effect it has on our skin. It is for people with dry and chapped lips and for all seasons. The reason for starting a business right now is because cosmetics are so wide range and everyone loves a good lip gloss and lip scrub for enhancement. According to Healthline, Chapped lips are usually caused by environmental exposures that eventually lead to irritation. The cold months and even sun exposure can cause chapped lips. Our lips don’t contain oils like the rest of our skin does, which means we have more of a chance of dry, chapped lips. Chapped lips can also indicate that our bodies are dehydrated, which can cause habitual lip licking which causes your lips to dry out even more.

The Owners The business will be owned by Nardia Ennis  Cosmetic Management student at Humber college  Diploma in Healthcare with 19 years’ work experience with the elderly and the disable  7 years’ experience as a business owner Princess  Cosmetic management student at Humber college  Freelance makeup artist and lifestyle blogger for five years  Efficiency in multiple computer applications I.e. excel, word access, quick books Crystal Morgan  Cosmetic Management student at Humber College  Has 2 years’ experience working in a warehouse  5 years’ experience as a business owner as well as with social media platforms/websites

The Legal Organization

7 Running Head: Drippy Lips Cosmetics Business Plan Drippy lips cosmetics consists of three owners Nardia Ennis 25% Crystal Morgan 25% Princess Amanquah 25% Also include 4 private investors at 25% shared Louise Simon Uwaila F. Iyobosa Faith Ojei Glory Obatayo All investors have the right to be a part of management if they choose to and will be at executive level of management. The reason for this legal setup is that it allows each owner to have equal say in the direction of the company and allows equal shares of profits. The private investors have a choice of being a part of the management team at executive level and will receive a 2.5% gross income annually with 0% interest on the loan. (See Appendix F: Drippy Lips Cosmetics Partnership Agreement)

Section 2: Feasibility

8 Running Head: Drippy Lips Cosmetics Business Plan In this section we will discuss the feasibility of our business and why the business model will work.

Location Analysis Our location for our business will start in Markham, Ontario but we will be open online through www.drippylipscosmetics.com. We would like to be available everywhere. The e-commerce nation is getting very popular now, consumers would rather buy online than in-store. 4 in 10 users purchase items after sharing it. ¾ consumers are more willing to buy a product based on recommendations. We will be using FedEx to ship our products to customers within Canada as well as internationally. We will be personally creating the products as well as packaging in Markham, Ontario.

Site Analysis The reason why we choose to sell our products online is because of our target market. The target market is more interested in online shopping and our company being online based makes it easy for purchasing and returns. We believe a website is the best way to sell products because it is easily accessible as well as convenient. If our website were ever to be down there is always the option to purchase through our social media sites. We will also make our products available through websites such as amazon and/or eBay. We will create advertisements on our social media sites and on google.

Market Potential Our potential customers aged 18 and older are expected at 20,000. The annual income spent on a household in Canada in 2018 is $86,070. In total, the average household spent $1,300 on personal care in 2017. So therefore, our total market potential is $26,000,000.

Competition Our direct competition is MAC Cosmetics and Sephora located in Markham. Both of these companies are very successful cosmetic businesses. MAC Cosmetics Lip scrubs are valued at $20.00. Sephora Lip Scrubs range from $10-$35. They do already sell the same products but it is made with harsh chemicals that can disrupt the skin and hormones. Everything we put onto our bodies is absorbed into the bloodstream. Both of these companies' product ingredients are made with toxic chemicals. Our products are made clean and natural. We don’t use any harsh chemicals and we create our products from scratch. Our indirect competition could be LUSH, they create their products with 99% natural products, but most of their products are made mostly of water and alcohol. LUSH lip scrubs are valued at $10.95. They do use very strong fragrances that are not natural. If they do change the ingredients in their products, they will end up being our competition. We use essential oils instead of harsh fragrances because many people have sensitivities to fragrances. We take pride in the safety of everyone.

Protecting the business

9 Running Head: Drippy Lips Cosmetics Business Plan Product Liability Insurance would be what we need to protect our business because we provide a small business which consists of products not services. This coverage is responsible for any problem that appears regarding the products and tracking number would be traced immediately to the company which vends the products. For instance, if our company sold products and there was an issue that arises during their pu...