Prospective Cosmetic Boutique Owner Needs Industry Statistics
Q: I am trying to fund a start-up loan for a small, high-end cosmetic boutique. I need a source for revenue numbers in cosmetic sales, broken down in average unit sales by department store or Web site purchase.
--Dione Carston
A: When my partner and I begin market research on an industry, the first place we go is to industry publications and associations. Most executives within a particular industry can easily refer you to some of these organizations. The Gale Group (https://www.galegroup.com) and Oxbridge Communications Inc. (https://www.mediafinder.com) are two companies that publish directories of publications and associations, respectively. An industry publication may have archived articles on the subject that you are researching and the association may conduct research and publish statistics. At the very least, an executive director at an association should be able to point the way toward the answer you are seeking.
In addition, there are research companies and industry consultants who track almost every statistic within any given industry, and most associations and publications know them. For example, a research company in the cosmetics industry is Kline & Co. (https://www.klinegroup.com).
But what you are asking, and probably need to provide for your loan application, is not only the per-sale amount, but also the average total amount of sales for a cosmetics boutique. Per-sale amount is only half of one side of the equation, since the total annual sales average for a boutique is made up of average dollars per sale multiplied by number of sales--and this amount is probably tempered by seasonality.
Many of the major search engines will yield places for good data on the cosmetics industry. When we can’t find what we need, we’ve resorted to calling marketing directors at the large companies within an industry and we have sometimes found them to be very helpful.
--Barbara Lewis, Centurion
Consulting Group, Westwood
Garden-Stake Entrepreneur Hoping Sales Will Take Off
Q: I have designed a garden stake and had local success selling it to boutique and garden shops, but I’d like to sell it by mail order exclusively. I’ve sent samples to catalog buyers, but am getting no response. Should I include a survey card? If so, what should I say?
--Deborah Brenton, Victorville
A: The best way to approach a buyer is to call the specific catalog company that you are targeting and find out which employee (get a name and title) handles the type of product line that you’re selling. Then send a letter of introduction to that person and advise them that you will be calling to follow up.
It is unlikely that a buyer will take the time to respond to a survey card even if you include a self-addressed, stamped envelope. That’s just not the way business works.
When you make the follow-up call (be persistent) and speak to the buyer or an assistant buyer, ask specific questions about how they buy, what they’re looking for and how the process for getting your product into their catalog works.
Be prepared to talk volume and price with them immediately. Buyers may request an “exclusive” for their catalog, but you are not under any obligation to provide it. Ask if you can send them a sample of your product. Don’t send unsolicited samples--they may not be well-received.
Many buyers like to discover new products at trade shows, so it would be worth your while to find out which shows they attend. You may opt to spend the time and money to set up a booth at one of these shows, though it is smarter to go to one as an attendee first so you get an idea of who is there and how things are done ahead of time.
If you decide to exhibit, make sure you alert your prospects (the catalog buyers) to your booth number and invite them to drop by and see you.
Buyers also like to know that their vendors are established and are going to be around in the future. Sharing press clippings, client lists and a list of trade shows that you’ve attended will go a long way toward making a favorable impression with the buyers that you target.
--Ken Keller, small business consultant,
Keller & Associates, Valencia
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If you have a question about how to start or operate a small business, mail it to Karen E. Klein, Los Angeles Times, 1333 S. Mayflower Ave., Suite 100, Monrovia, CA 91016, or e-mail it to kklein6349@aol.com. Include your name, address and telephone number. This column is designed to answer questions of general interest. It should not be construed as legal advice.
