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Monday, May 17, 2010

Online Business of Cosmetics

Cosmetics Manufacturing

Business Plan

Maria is here with a company that has created a brand

concept consisting of both skin care and athletic apparel

utilizing multiple channels of distribution. We are seeking

recurring investment to fund the growth of the brand, and

position the company for an IPO. The plan that follows explains

our market, our value proposition and our market segmentation

strategy. The detailed financial plans provide a clear view of

our sales and profit forecasts. These plans show how it

will reach profitability in our third year of operation and

generate shareholder return on equity within five years.


Mission
To establish Bluespa as an important brand that represents

quality in skin care, fitness apparel and accessories.

We will accomplish this using high quality manufacturing and

research, a creative marketing program, and a comprehensive

distribution network using both brick and mortar retail outlets,

internet presence, and a consumer catalogue.

By utilizing this multi-channel approach we will be able to reach the

niche market for quality personal care products rapidly and efficiently.

It will allow us to develop Bluespa as the brand for quality skin

and body care products within our target market.

The Company
Bluespa is an Oregon corporation. The company is 100%

owned by Ray and Barbara Brunner, the founders.

The board will consist of seven members: Mr. R.G. Brunner,

one additional member of management, three outside directors

appointed by Mr. Brunner, and two representatives appointed

by the major investor(s).

Together, Mr. and Mrs. Brunner have 65 years worth of combined

experience in the retail industry. Both of them have held senior

management positions with major companies in this area.

The company's main office is located in Portland Oregon.

The leased office space should be sufficient for planned staff size

growth within the first few years.

cosmetics1.jpg image by Sky_Akilina

From Year 1 through Year 5 we will grow in head count from ten

to sixty-five. The majority of this growth will come in store personnel,

the rest will be support staff. We believe the plan shows

a controlled and conservative ramp up of personnel.

Products

Skin and body care products will be developed and produced at

our contract facilities in France and California. Production of apparel

products will be managed through our contract manufacturer of

sport-related apparel. Production of accessories will be managed

through a contract with a manufacturer of quality sports-related

accessories including: bags, hats, totes and socks for the

wholesale market.

Bluespa will have two product lines, skin care and fitness apparel.

Within the skin care line we will offer a wide array of products

including eye makeup removers, cleansing creams, facial scrubs

and masks, and body lotions. Within the fitness apparel line we

will first offer Lycra products such as tights and shorts,

plus polyester and cotton tops.

Our pricing strategy is to position our products with a shelf price

that is in the mid to lower quadrant of high-quality products and

brands. We have accomplished this by making careful market

comparisons and adjusting our packaging size.

We believe our ability to create future product opportunities and

growth will only be limited by our imagination and our ability to

attract talented people who understand the concept of branding.

The Market
Bluespa will occupy a unique market position. No other brand

offers a specialty line that includes skin care, cosmetics,

fitness apparel and accessories. However, within each category

significant brands do exist. Quality and price vary widely within

each group. Bluespa will be positioned as a quality brand.

The U.S. cosmetics market has seen large annual growth rates

over the past decade. Last year alone, the market grew by over

$1 billion. Clear divisions between traditional categories are

becoming blurred and new lines, such as aromatherapy are

also emerging, creating new openings for profit.

In fitness apparel and accessories there is a tremendous

opportunity since the female customer has been grossly overlooked.

Most major companies do not produce products focused specifically

on the female customer. Puma is the only brand that has developed

a line of fitness apparel fro women. Early sales for them have been

exceptional, further highlighting the potential within this category.

In the skin care and cosmetics category the competition can be divided

into three groups: Commercial--i.e. MAC, Origins, Philosophy,

Erno Laslo and Shesheido; Clinical--i.e. Kiehl's, Clinique,

Clarins and Dr. Hauscha; Spa--private label brands associated

with spas.

The Customer
Because Bluespa is a combined retail (direct to end user) and

wholesale (to the end user through a reseller) strategy our target

customer must be broken into two distinct groups, the end user

and the reseller.

Our targeted end user is between the ages of 24 and 65.

They are female urban professionals with at least some college.

This consumer has an active lifestyle. They are concerned about

social and environmental issues. Mind and body wellness are

important to them. They belong to a health club; take yoga, pilate's

or tai chi lessons. The effects of aging and the maintenance of

a youthful appearance are a part of their life.

Our target customers (vs. end user) for wholesale distribution will

be resellers who recognize the needs of this consumer and who

she identifies with. We have used the term resellers because they

will not be limited to retailers. We will reach the consumer through

four distinct reseller channels. Spas and Health Clubs, Lifestyle

Retailers, Cosmetic Specialty Retailers, and Boutique Department

Stores.

There are a number of new demand trends that have impacted the

market and created greater opportunities. These trends include a

returning to age old, time proven, natural remedies; more consumers

that are looking for more holistic and healing benefits from her skin

care products, and today's consumer being more informed and more

inquisitive about the benefits of her personal care products.

Financial
In order to launch its unique product line Bluespa requires an initial

outlay. Sales at Bluespa retail stores are planned to grow rapidly

from Year 1 through Year 5. During this time frame our wholesale

revenues are planned to grow enormously. Bluespa will become

profitable in our third year of operation. Initial growth will be financed

by a combination of equity investment and debt financing.

Our ratios are well within prudent limits and our growth plans are

challenging, but realistic.


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