The cosmetics industry is a multibillion dollar trade. With many great lines like Make-Up Forever and M.A.C. getting their starts as small boutique lines, the sky is the limit for creative cosmetics sellers. Opening a makeup boutique can be a rewarding and creative experience, although it takes a lot of work.

Licensing, Planning and Development

The first step is to create a business plan for your makeup boutique. A proper business plan includes financial projections, startup cost estimates, mission statement and demographic information. You'll also have to think about the competition, as well as any licensing fees. The document should be complete enough to use for business loans, if needed.

Next, obtain licenses, business permits, tax ID and trademarks, as needed. If you'll be employing others, also get an employer ID. These are necessary to obtain wholesale discounts, bank accounts and mark protection.

You may also want to incorporate the business to protect your personal assets. For a small business, an LLC (limited liability company) may be the way to go. If you're not ready to incorporate, then register as a sole proprietorship, although this won't afford you the same asset protection as LLC registration.

Financial Considerations for Your Boutique

You'll need to secure financing for your storefront. This could be through a bank, private investor or family member. If using private investors, it's imperative to have a lawyer draw up a clear contract stating all financial liability, duties and interest involved.

Once you have financing, lease or purchase property for the storefront. Usually, boutique cosmetics do well in more affluent areas, since boutique cosmetics are aimed towards a higher-paying clientele. A makeup store benefits from lots of natural light, so corner spaces are great, even though they cost more.

Making Your Store a Success

After you've secured a location, design the inside of the store to suit your demographic. Are the cosmetics you're selling aimed toward younger people, or are they for the more mature consumer? Think about all of these things when picking out decor. If in doubt, go sparse and elegant with smaller artistic touches to add personality. Keep in mind that cosmetic shops should be very clean, so stay away from materials that are hard to disinfect and maintain.

Stocking and Running the Store

Decide how you'll stock the shop. Will your makeup brand be private label, or will you carry famous brands? Will you be aiming to attract professional artists? All of these factors dictate the quality and price point of the products you'll be selling, as well as quantity and range.

For help with knowing what products to order, do some spying in big-name department stores to see what they have a lot of, and what's on clearance. Ask shoppers what they're looking for. Make your biggest purchases among staples such as foundations and mascara, and add some seasonal trends to spice things up. Both classes of product will bring in repeat buyers.

Be careful when buying that you don't over-purchase. Makeup has an expiration date and will grow stale if left for too long. Be conservative when making that first order so that you save money and reduce waste.

Buy display equipment to show your cosmetics in the best light possible. This means buying nice chairs, well-made cases, good lighting and mirrors. Don't only think of the customers, but also the employees, who will have to use these tools to show the product off in the best light possible. You can also bundle your products in unique ways, such as creating a makeup bouquet with coordinated products.

Staffing Your Store

You will also need to hire employees. The best places to go are beauty culture schools and theater programs to obtain recent graduates. Also try trade shows and job fairs to find good workers. Artists with makeup artist certification are best, but a well-developed resume is great, too. You can also hire support staff to take care of paperwork and bookkeeping, if you'd like. When hiring, use a contract and make expectations very clear. It helps to offer product discounts as an employee benefit, as well.

Opening Your Boutique

After training and stocking, it's time to open. To keep the customers that you bring in, remember that great customer service is key. Have your employees keep a customer contact list that they can call for sales and check-ups. This is a great way to make customers feel special and well cared for. Also, call people to see if they need help with the new products. Good customer care is a prime motivator for shoppers to return.