What do I need for a perfume business?

[Nadim.c]

To let you guys know where I am, I'm 16 but have saved up slightly and will earn more. In the next summer holiday, I will have approximately £875 to start (from college attendance bursaries☺), with 6 weeks to work if I need more. I got the right links for jobs so can pretty much get a job straightaway (worked after GCSE for about 10 days).

My job has definitely improved my social skills and I've seen how negotiations are done, which could be vital.

I'm interested in the perfume business. It will atract people as it stimulates your nose I think. But locally I realise there is a large gap in the perfume and fragrance market, and a key niche market which I can take control of. There is a major competitor who run about 3 stores. Wouldn't take me as an employee so couldn't learn from them but they are missing out a niche market which I think has a demand. But that's my opinion at the end of the day, and needs market research before I invest money.

My plan is to buy chemicals and the necessities needed to start it up and make it at home. Then sell it online and locally such as boot sales and maybe the market, if things work out with the council. Should do as the council are trying to get my age group into doing things, and I definitely do want to do something as I HATE sitting at home on the Xbox.

Does anyone have experience of building an ecommerce website, producing perfumes, selling locally, getting market trader licenses, market research. Any advice would be great. And contacts and links would be the best!

Thanks,
Nadim

 

[Mr D]

The bottles / containers are easy enough to get. Multiple suppliers around.

You will be using standard recipes? Need to get your product tested in a lab to be sure it's safe for putting on skin.
And insurance. May well need to prove you have that before market will let you trade.

Websites are easy enough to set up to start with, pay later (or learn) to get a better one done later.
Marketing can be expensive. The big names will spend a fortune on marketing their perfume.

 

[Nadim.c]

I will probably use standard recipes. I'll try to avoid using a laboratory to keep costs down, but if I have to, I can't do much about it. Need to find people doing the tests.

Websites is not too much of a concern, built a website in Year 9 ICT but I'll need a refresher. Got a friend that has the IT know how, could get him to help.

My local area has a large Asian community, and my dad knows a few people in the media business. He can probably get me an advertisement in asian newspapers for relatively cheaply. But i will have spare cash hopefully in case.

 

[Chris Ashdown]

You need to make a business plan outlining your costs and expected profit and how you are going to sell your product. the competition is massive from imported cheap perfume for a £1 on the market to a few thousand a bottle at the top end, so where do you plan to compete and how

There is no standard recipes for perfume, you have to trial different mixtures until you get a nice one. you also need no doubt to have it checked as safe. Insurance may be high but you will need it and do you intend to sell on the website or just advertise again quite large costs if you are selling

You could consider a easier option especially with your limited budget buy buying a few bottles from the existing supplier and try selling it on the market you have identified. ask for a trade price which should give you a larger margin for profit

Whatever you do never underestimate the money companies need to spend on marketing and presentation to sell there product

There are plenty of books on starting a new business which will talk you through the whole process and all the things you need to consider look in your W H Smiths or similar book shop, some banks give away free copies to potential customers

 

[Paul Norman]

Whether or not there is a gap in the perfume market I am not qualified to say without research.

However, I do understand business.

And I suspect one of the challenges here might be the need to build business knowledge into your commendable enthusiasm.

First, marketing. Year 9 ICT skills will not be enough to digitally market in 2018. Of course, you have recognised that. Building the site may not be a challenge, but getting traffic to it will be, and is increasingly unlikely to be free.

Secondly, testing. This has been mentioned. But for products that will be used like this you will need sufficient testing to satisfy and insurance company that you are a risk they are willing to insure. You cannot go to market with this without adequate insurance.

Thirdly, verifying that gap. To do that with precision is not about asking a few people, or believing there to be a gap. It is about establishing that people are going to respond to something new. The top end perfume market seems well stocked with branded names, many carrying the backing of high profile celebrities - and celebrity based branding is big in perfume, as it is in fashion. So the gap is going to be further down the price line. I am not going to presume where, but I urge you to really check out that there is a market here. The cliche is this. There may be a gap in the market, but is there a market in the gap.

Fourthly, your route to market. Make sure you know where, and in what volumes, your stuff will sell.

And finally, from me, do the sums. Do them thoroughly. Because cash flow is tough - you may have access to funding, of course, but with products like this it is all cash up front from you, with maybe longish delays before you successfully get regular sales.

I wish you well. This could be a business idea. You sound enthusiastic, and willing to graft. But do plan, and do so without being too easily optimistic.

 

[Nochexman]

I applaud your enthusiasm!

I know next to nothing about perfumes, but I guess the health and safety aspects of what you are proposing - making stuff at home and getting it approved for use - will ultimately stop you from achieving your goal. Sorry to be so negative.

One suggestion I'd make is this. If you have identified a niche that is not being served, would it be possible for you to serve that niche without having to get into the manufacturing business? Could you not source perfume elsewhere and sell into the niche you have identified?

 

[bharris]

One issue with selling perfume on the internet is people cant smell it and that makes selling a unknown scent very hard. Make sure you also have testers for sale. To build up a customer base you will have to get out in front of people. If by some chance you do get a celebrity endorsement the marketing value is only very short lived so make the most of it.

 

[Leesa Johnson]

Before you start perfume business, do market research and find out a variety of perfumes available in the market. Prepare a business strategy and also work on product packaging. Then after, choosing skilled persons for selling products because better speakers can sell your products in a better way. Best of luck.

 

[Mr D]

Oh and storing chemicals at home - check what you need for that.

 

[Nadim.c]

Thank you everyone for the advice, it is very much appreciated.

I will definitely check regarding health and safety, I don't want to get sued. I'll experiment with small amounts first. I won't produce at home, my parents will go crazy if I do! But I know for selling food, you need to be OK with the Food Standard Agency, I'm unsure where to go for perfumes. Doing this seems more expensive than I thought, but it won't stop me. If I lose, it's no big deal, as long as I learn a lesson. I got no bills to pay or anything, so I'm fine.

My year 9 ICT skills is very basic, I know it won't help. I'll get some help from a professional with that as first impressions count IMO.

I have thought of creating small samples, like those free samples my sister gets when she walks into the shops. Could post them to people that are interested.

I have an uncle who is in the food packaging business. I'm sure he'll know a bit about packaging, probably not so much about creating labels.

If anyone could put me into contact with reputable perfume manufacturers in London and surrounding areas, that will be great.

If i start up, my sister can definitely help. She has 1.2k followers in Insatgram, so can take advantage of that for probably £5.

I still need a clear business strategy and plan to do this, but I'm no big rush, plan to start in July 2019.

Thank you very much for the advice everyone. Even if it is positive or negative, every advice helps and makes me think more about this.

 

[Mr D]

Sending perfume by post:

Perfumes and aftershaves
Including eau de parfum, eau de toilette and alcohol-free perfumes, but excluding non-flammable perfumed creams, gels, oils or lotions.

Volume per item must not exceed 150ml. No more than four perfumes or aftershaves can be sent in any one package. The perfume or aftershave must be within its original retail packaging and then placed in strong outer packaging. The inner packagings must be packed, secured or cushioned to prevent breakage or leakage of their contents into the outer packaging.

An ID8000 label must be applied. The sender’s name and return address must be clearly visible on the outer packaging.

These items must be presented at a Post Office counter.

 

[Nadim.c]

Thanks @Mr D , it's good knowing what i can send and not. Better to do it right than making mistakes.

I looked into the CTPA , the
Cosmetic Toiletries and Perfumes Association, and it seems you need to pay a minimum of £1100+VAT (regardless of whether you manufacture a perfume or just retail it). So that's a big let down. I think you need them to sell products, it seems like the official legal people I need.

But even with this, I'm sure there are other ventures I could go into. (I know food has a good markup, saw it when I was a waiter)

 

[bharris]

Sending perfume by post:

Perfumes and aftershaves
Including eau de parfum, eau de toilette and alcohol-free perfumes, but excluding non-flammable perfumed creams, gels, oils or lotions.

Volume per item must not exceed 150ml. No more than four perfumes or aftershaves can be sent in any one package. The perfume or aftershave must be within its original retail packaging and then placed in strong outer packaging. The inner packagings must be packed, secured or cushioned to prevent breakage or leakage of their contents into the outer packaging.

An ID8000 label must be applied. The sender’s name and return address must be clearly visible on the outer packaging.

These items must be presented at a Post Office counter.

And you can only send it within the UK. You can not post abroad

 

[bharris]

There are many home industries making and selling perfume who have no certification or association membership just a basic Cosmetic Product Safety Report. Have a look at http://www.naturallythinking.com/lab.html more about shampoos and creams but it does tell you about testing. I think they charge quite a small fee for testing.

 

[Nadim.c]

@bharris thanks for that, never knew it could be that cheap. Much more affordable. I'll search for someone testing perfumes. What I'll do is create a business plan like others have said outlying costs and everything plus around 15-20% more than I expect for any costs, without being too optimistic. I do want to do well in this, and build my company up.

Thank you guys very much, it is appreciated.

 

[Chris Ashdown]

Hi
It would be more expense i am afraid , but you would be wise to consider a limited company when producing things that people either put on their body or eat to give you some protection. The cost of a Ltd company is not great but year end accounts may need a accountant and can be anything from say £500 to £1000 per year unless your dad knows a friend

 

[Nadim.c]

Thanks @Chris Ashdown , I'm probably not going into this anymore as I realise it will cost much more than I guessed. What you said about LTD companies is something I will keep in mind, seems like a good idea, and my dad might know an accountant, not too sure. I'm probably going to be selling food. There's always a demand, otherwise we'd all die. But its standing out the crowd and all the health and safety that matters. There is a good amount of money to be made, saw it first-hand when I was a waiter. They make a mojito for around £1 and sell it £5, and they sell probably 50 a day in that restaurant. On top of that, I discovered my council will let me have a market stall once I'm 17, so have a year to save up. I already know some people in the food industry that can advise me and just need the money now to start up. Ill keep everyone posted on how I do, cos everyone here seems good, but I can't really do much until next summer, especially with a levels to do. But thank you everyone for the advice, I probably learnt more from everyone's post than I would have by online research, such as posting and marketing, etc. It will be useful one day.