If you are thinking of starting your own brand of cosmetics, hair care or skin care, you are probably overwhelmed by “now you're supposed tos.” Worse yet, even if your partner (or mom/dad/uncle) loaned you some money to get started, you quickly realized it wasn’t enough. Not to worry; no matter where you are in this process, you will find some extremely helpful information herein.
Let’s talk about the complexities of the journey you are about to embark on (or that you’ve already discovered on your own), as well as the simplicities. Of course, you already did the hardest part which is making the decision to launch your own products under your own brand. Congratulations, you are already far ahead of the rest of the crowd who is still thinking about it, perhaps too scared to ultimately make that decision.
1. Choosing a Brand Name to Trademark
First, the simplicities. You need to make sure the name you want is available as a trademark and a domain. You can search U.S. trademarks to see if it is already taken in your category here: https://www.uspto.gov/trademarks/search.
Next, search somewhere like www.godaddy.com to see if your domain is available. If your preferred url is not available, consider a different name. You don’t want to launch with a name you think is great only to later find out you can’t trademark it or get the url for it.
You can use a legal service like legalzoom.com if you need help with the trademark registration or just hire a trademark attorney.
Now you will need a logo as well as a look and feel for your brand. Consider somewhere like 99designs.com or fiverr.com to get help from designers without breaking the bank. Pick a product and have them design a logo, using a font you like, and get a feel for what your product will look like. Many of these designers have stock images they can use to give you a mockup of a finished product.
2. Maneuvering Minimum Order Quantities
Next up, the complexities, which is where we sometimes lose about 75% of the people who got this far. The dreaded MOQs (minimum order quantities).
Most people search for “Private Label X" (the blank is the product you are looking for) on Google. If you were looking to make private label aloe vera gel, for example, you’ll find several manufacturers who private label that product.
So, how many units do you have to order to qualify (MOQ)? Some manufacturers want an order of 10,000 minimum to put your label on it. Some are just 5,000. A few will do only 1,000, and just a small handful will do as low as 500. But keep in mind that is per product.
So, if you were trying to start your own product line, that would be six products, 1,000 each, for a total of 6,000 units. And if the price averaged $6 per unit, you would be looking at a $36,000 upfront investment.
Add onto that shipping and handling as well as an advertising or marketing budget and we just lost all but about 1% of you.
3. Appealing to Consumers
How can small brands compete? How do startups ever get large enough to order even the minimum MOQs? Is the whole thing rigged so the little guys can’t even get started, let alone go up against the big brands?
The short answer is yes, sort of, but there is good news. Today’s consumer has grown tired of the stale old beauty companies, those large Fortune 500 brands sold in every department store across the country.
They want clean beauty, organic ingredients and natural formulations that appeal to their own sense of individuality. They want a brand they identify with, that they feel represents their own values and ideals.
So, the barrier to entry to the consumer is very low, so low in fact that they are looking right now for the brand you are about to create or just created. Your brand will appeal to hundreds of thousands, if not millions, of consumers who have been searching for something just like what you plan to make or have already made.
But, we still have this nagging problem of MOQs, right? Maybe not.
4. Selecting a Manufacturing Partner
While you could become a kitchen chemist and try your hand at formulating, you would then have to find your jars and lids, order them and try to deal with those MOQs. Then you would have to source every ingredient and deal with each of those companies’ MOQs as well.
The fastest and easiest way is to find a company that already stocks a large assortment of items you can put your own label on. Find a company with values that align to yours (organic, vegan, cruelty-free, whatever is important to you). But also be ready to compromise.
While your idea (a special aloe vera gel that contains a mineral from the bottom of the ocean found only on the western shores of a small island in Fiji) may be the greatest product anyone has ever heard of, it is much easier to begin with a few products that are of high quality that people already love.
You will have a few misses and a few hits. But you won’t have tens of thousands of dollars tied up in novel products that aren’t selling.
To test the waters, order 12 or 24 of a SKU. You will pay a little more for such a small order, but these first orders are just to make sure you can create a market and find your customers. Then, you reorder maybe 100 or 200 at a time and grow within your budget.
Pretty soon, you will be ready to get that incredible aloe with the special Fiji mineral contract manufactured for you because you will already have a following who loves your products and will buy anything you come up with. And, you’ll be paying for it with the profit you made from starting small.
Chris Estey is the founder and CEO of Private Label Skincare Florida.
