How to Start a Beauty Business in 2025

Dreams of launching your own beauty business in a multibillion-dollar industry with nearly 200,000 competitors might initially feel like just that—a dream. How will you differentiate yourself? How can you compete with celebrity-backed brands and legacy players? Is there anything even left to make?

But the truth behind those big numbers paints a far more optimistic picture.

Consumers continually fuel the industry’s steady growth—a gain of 7% year over year that reached $33 billion in 2024—by searching for increasingly specific and personalized products and backing indie beauty brands with high-quality, niche offerings. Demand and discovery continue to grow thanks to social media, with 83% of Gen Z women purchasing beauty products because of content creators and 41% of all beauty and personal care sales in the first half of 2024 occurring through ecommerce platforms.

This leaves room for new founders to enter the market, particularly as beauty continues to dovetail with overall wellness. Ready to get started? Here’s your step-by-step guide to building your dream beauty business.

How to start a beauty business

1. Pick your niche
2. Make a business plan
3. Manufacture your products
4. Register your business
5. Attain certifications
6. Develop your brand identity
7. Build a website
8. Create a marketing plan
9. Manage operations

Whether you’ve always followed the latest cosmetic trends or hope to ride the wave of a growing opportunity, here are nine steps to start a successful beauty brand.

1. Pick your niche

The first step to launching a beauty business is identifying your focus or niche, which lets you target a specific audience and offer products, services, and content tailored to their needs. For example, your beauty niche could be one of the following:

• Hair care. Hair care products include shampoo, conditioners, hair masks, styling products, tools, accessories, and more.

• Skin care. Skin care covers facial and body-specific products, from face and body wash to moisturizers, essential oils, exfoliators, serums, toners, masks, and sunscreen.

• Makeup. Makeup can include eyeliner, lipstick, eye shadow, brushes, and foundation. Makeup may also overlap with skin care, with formulas designed for skin health, as seen in brands like Glossier and Tower 28.

There are specialties within each of these niches to help you stand out, like products formulated with organic or naturally derived ingredients, or those created with certain skin types or tones in mind.

Many beauty founders start as consumers who notice a gap in the market. Motivated to solve this problem, they start their business to fill the need.

For Tower 28 founder Amy Liu, existing eczema products didn’t meet her needs, so she set out to create a product line that held up under clinical examination but felt bright, fun, and expressive to shop for and to use. “I wanted really good products. And when I went to go cover up my skin, I felt like I was so nervous that [other products were] making my skin worse, and it was just perpetuating my problem,” Amy says on an episode of the Shopify Masters podcast. And so her eczema-friendly beauty brand, Tower 28, was born.

If you’re unsure what to specialize in, here are a few steps to narrow it down:

Look for passionate communities online

Use social listening in your market research to tune into beauty-related discussion forums and product reviews on social media. Users will often share unfiltered advice or experiences they’ve had as they search for the perfect product experience. Use these learnings to influence the creation of your own products and shape your brand positioning.

For example, you may notice a growing demand for beauty brands that appeal to a wider age range. Courting an older or more inclusive customer base (who may also have more disposable income) with your product design and marketing can set you apart in a marketplace saturated with messaging around looking young or “reversing” the aging process.

Get feedback from potential customers

If you have the beginnings of an idea for a product, seek detailed feedback and validation from your target audience. What product features are they looking for, and what are they willing to pay for your hypothetical product? These conversations can help you gauge interest and highlight must-have components you might have missed.

Verify your niche’s market potential

Market analysis is about understanding the unique opportunities within your niche industry and identifying your potential audience using tools like SWOT analyses and industry research. If you’re unsure if there’s a market for your product, research your total addressable market (TAM) and market growth rate. TAM uses the revenue of similar businesses selling to your target audience as a baseline, and your niche’s growth rate indicates favorable trends and momentum.

2. Make a business plan

Starting a successful business often feels like a philosophical exercise where each question generates five more questions. A business plan aims to keep track of and answer those questions while a fully formed strategy materializes.

Start by writing a high-level overview of your beauty business that captures who’s in charge, what you’re selling, why you started the business, and how you intend to succeed. Describe your unique selling proposition (USP) and values, whether that’s product-centric (e.g., simple ingredients to reduce breakouts) or mission-based (e.g., eliminate plastic waste from the beauty industry), and include a market analysis demonstrating your understanding of your place among competition.

At the heart of your business plan is the nitty-gritty of your beauty products. Get into the details on sourcing and manufacturing, your star ingredients, certifications you’re seeking, and the intended audience for each product. Detail your target market with ideal buyer personas and define a high-level marketing plan to reach them—for example, sending samples to beauty editors or partnering with influencers.

Create a logistics and operations plan that summarizes your intended workflows and equipment. Identify where your business will exist: online, in a brick-and-mortar store, or on the shelves of retail partners. Cap off your business plan with a financial breakdown with projections, an income statement, a balance sheet, a cash flow statement, and any other relevant data, like a sample pricing sheet.

3. Manufacture your products

There are three routes to consider when creating your products:

Private label

Private label formulations are ready-made and typically go through safety tests. This option can be more cost-effective, allow you to work quicker, and remove overhead costs associated with developing your own formulas. Find private label formula partners through in-person industry events like trade shows and online platforms like Alibaba, ThomasNet, and Faire.

Working with a manufacturer

A cosmetics manufacturer may have ready-made formulas close to what you’re looking for, or they can help you create and test a semi-custom product. If you choose to work with a cosmetic lab, be sure they meet official quality and safety standards and carry certifications important to you, like certified cruelty-free or organic. Use a beauty directory, like those from Happi or Allure Labs, to find a manufacturing partner.

In-house chemist

Consider adding a dedicated chemist as head of product for your cosmetic business. This is a good idea if your vision involves creating best-in-class products that require intensive development and testing and if you prefer keeping development in-house instead of working with a third party. An in-house cosmetic chemist can also add insight and legitimacy to your marketing campaign.

Don’t settle for the first manufacturer that says they can do the job: Ask your network. If you have strong relationships with fellow founders, see if they’d be willing to share what they’ve learned or who they trust. When comparing manufacturing partners, ask for references that reflect your current goals and considerations.

“You want someone that you can trust, somebody who can act quickly, someone who will do what they say when they say they’ll do it,” Amy says. “If you’re making a physical product, you especially need to think about production: Where is it being made? What are the MOQs [minimum order quantities]? Will they work with you when you’re small, and what does that look like?”

4. Register your business

Registering your business can be distilled into these main steps:

• Pick your business name. Aim to choose a memorable business name that’s clear, compelling, and emotionally resonant. Make sure it’s available as a domain and social media handle.

• Choose a business structure. How you structure your beauty brand (e.g., a sole proprietorship or an LLC) has legal, tax, and financial implications. If you’re unsure of your best structure, consult a legal adviser.

• Register with federal agencies. Register your business with the IRS to secure an employer identification number (EIN), also known as a tax ID number. This keeps your business taxes separate from your personal finances and allows you to hire employees.

• Get certified. Check for relevant guidelines or required permits through your Secretary of State’s office or a dedicated business bureau, and obtain the necessary certifications.

• Register for taxes. Unless you’re doing business in Alaska, Delaware, Montana, New Hampshire, or Oregon, you’ll need to collect sales tax for your beauty business by registering with your state’s revenue authority department online or by phone.

For more information, read how to register a business here.

5. Attain certifications

There are both required and optional certifications for beauty products, including for sustainability and environmental impact, natural and organic ingredients, cruelty-free production, and general safety regulations like the FDA or Cosmetic Safety Program. Each has its own testing protocol and approval process. While completing certifications isn’t part of a standard cosmetic manufacturing agreement, your vendor can usually help you navigate the necessary standards you’ll need to meet.

Understanding this process helps you avoid vague claims like “clean beauty” and clarifies what you do for your audience. “Before I started Tower 28, I worked at one of the pioneering brands in the clean beauty space,” Amy says. She says that back then, clean meant natural, so their marketing and packaging skewed that way. “The world evolves, right? Now we know that clean, natural doesn’t necessarily mean good for you. It doesn’t mean that it’s safe for sensitive skin.”

Amy’s commitment to certification, and the rigorous testing it brings, led to a hard-won seal of acceptance from the National Eczema Association. “I’m not a dermatologist. I’m not a toxicologist. You shouldn’t believe me if I just say this is safe for sensitive skin,” she says. “I believe in third-party verification. … We’re the only beauty brand 100% compliant with the National Eczema Association.”

6. Develop your brand identity

Brand identity is a universe unto itself, so it can help to address each component individually. The main elements of a strong brand identity are:

• Logo. Your brand logo is an at-a-glance symbol of your business. They can be pictorial marks, wordmarks (logotype), or a combination.

• Color scheme. Your brand’s color palette reflects your personality and psychologically influences the mood customers experience when interacting with your website and products.

• Typography. Typography is the typefaces and fonts you apply throughout your business, like on your website and packaging. Aim for consistency across properties, with no more than two typefaces competing for attention.

• Voice and tone. Voice and tone establish your brand personality, both in how you explain your product and who it’s for. It’ll dictate messaging everywhere, from how you handle customer feedback to how you communicate over social media or email.

• Imagery. Photography, illustration, and graphic design are all part of your brand’s visual identity. If you don’t have the budget for high-quality imagery early on, consider user-generated content (UGC) to showcase your products in everyday life.

• Packaging. Branded packaging, especially in beauty, is an opportunity to delight your customers and underscore your brand identity through thoughtful elements or fun extras, like stickers.

Your brand and its level of creativity can evolve as your business grows and its target audience changes—but small, affordable touches early on can make a huge impact. For example, Tower 28 started with a basic decorated craft mailer containing the product and some stuffing inside. “We ordered everything from ULINE, nothing exciting,” Amy says, “But I’ve always believed in a handwritten note.” She and her early team underscored their gratitude for customer support.

7. Build a website

Beauty websites are highly visual and focus on creating the perfect mood. A great beauty website captures how you want your customers to feel as they move through the world. They can promise transformation, confidence, or a deeper sense of self.

How you present website visuals, structure your customers’ experience, and design the checkout flow will depend on what your business offers. For example, if your website drives sales of physical products, emphasize inventory management, payment processing, and product layout in site design. If your beauty business drives in-person services, focus on appointment bookings, customer reviews, a portfolio of past work, and brand storytelling.

Pick a website builder and host, like Shopify, and then select and register a domain name. Use relevant templates to create a polished look and add marketing basics like logos, high-quality examples of your work, and contact info.

8. Create a marketing plan

Your marketing strategy details your plan to capture the attention of potential customers and turn them into loyal brand advocates. One way of breaking down this roadmap is through the seven Ps: product, price, promotion, place, people, packaging, and process.

Social media is an excellent spot to engage with your audience—through commentary, behind-the-scenes content, and answering questions—and show your product portfolio in action with demos, before-and-after images, and more. For example, the “get ready with me” (GRWM) content format shows viewers how to use or incorporate your product into their routine. Educational content, like the deep dives that skin care brand Dieux shares on its ingredients and formulation, can establish customer trust.

If social media builds a passionate fan base, positive reviews in mainstream media build legitimacy. Try pitching beauty journalists, magazines, and local news outlets, or write press releases touting your products. Consider sending free samples and complimentary products to earn attention.

9. Manage operations

Create a plan for where and how you’ll sell your products. Leverage earned media to pitch major retailers to carry your brand. Research stores and target audiences—theirs and yours—extensively before you pitch so you can make a clear and compelling case for why they should carry your products.

Finally, build out your inventory and supply chain management approach. Be wary of starting with too much product, which you’ll have to pay to create and store before demand catches up. Investing in an inventory management system can help you optimize supply quantities with site data. As you grow, your tracking system will grow with you.