With the hair industry booming the way it is, it's obvious why everyone is interested in starting a virgin hair business. Fortune magazine cited that the hair extension market is roughly worth 5 billion dollars! Selling hair extensions is a very lucrative business because of the high demand for products. Making the possibilities endless if you start a virgin hair business. If you are interested in starting your hair business and have no idea where to start, you are in the right place. Look no further here's your guide to starting a virgin hair business.
Step One: Write A Business Plan
A Business plan is a blueprint for your business plans. Your virgin hair business plan will help you to focus on your strategy, manage your milestones, assign and track responsibilities. Your business plan also will help you to manaage money using projections for sales, costs, your expenses, and cash. A Good business plan is a living document that you continuously return to and update as you learn about your customers, sales and marketing practices that work and don’t work, and what you project wrong for your budget forecast and adjust it accordingly.
Six Things You Should Include In Your Business Plan
This section is an overview of your business and your plans. It is first in your plan and is ideally one, maybe two pages. Its okay to write it last if need be. Your executive summary should be:
One to two sentences of what your business does.
This section answers these questions:
- What are you selling?
- What problem are you solving? Or, What need are you fulfilling?
- Who are your target market and competition?
How are you taking this opportunity and turning it into a business? This section should cover your:
- Marketing and sales plan
- How you are going to measure your successes
- Provide a summary of your team and a simple explanation of why you and your team are the right people to take your idea to market.
- Highlight key aspects of your financial plan. Create a chart that shows your planned sales, expenses, and profitability.
- Include your business model (“how to make money”).
- Include your funding requirements
Step Two: Find A Hair Vendor
Step number two in the ultimate guide to starting a virgin hair business is finding a hair vendor. Finding your hair vendor is imperative to your hair business. You have to be sure the lines of communication is excellent, their virgin hair is up to par, and their pricing is ideal for you and your virgin hair business. When looking for a hair vendor here is the list of must haves!
Must Haves From Your Vendor
- Excellent communication - You should be able to contact them by phone, email, and social media platforms. There's nothing more unprofessional than being unable to get in touch with your hair vendor when a problem arises.
- Quality - How is the virgin hair processed, collected? Blended? Fabrication? And Sanitization?
- Does your company perform in-house?
- How is the virgin hair sourced?
- How was the virgin hair pattern created?
- Textures and lengths available?
- Are frontals, 360 frontals, or closures available?
- After payment, how long does it take for the order to ship?
- Is there a minimum?
- Is there a discount for bulk orders?
- Are you a private label company?
- Do you have samples?
- What is the return policy?
- Can I have photo confirmation before shipment of the hair?
- Are the cuticles aligned?
- Is the length measured stretched or unstretched?
- Single or double drawn?
- Is the bundle from one donor?
- Is there restocking fees?
- Do you drop ship?
The questions are endless, however, drawing up a list of the most important questions for you and your business. Black Show Hair is glad to be your hair vendor, and grow your hair business.
Step Three: How Much Are You Going To Charge?
Ask a customer to pay too much for hair extensions, and they will stop buying, charge too little and your profit margins are terrible. No matter what you are selling, the price you charge your customers will have a direct effect on your virgin hair business. Before setting your price for your virgin hair, you must know the costs of running your hair business. If the pricing of your product does not cover the cost, your cash flow will cumulatively negative, you will then have to exhaust your financial resources, and ultimately your hair business will fail.
Cost of Materials + Cost of Labor + Overhead = Total Cost
Total Cost+ Desired Profit (20% of sales) = Required Sale Price
Margins or your gross margins are the difference between your total sales and the cost of those sales. For example: If you have sales equal to $1,000 and your cost of sales is $300, your margin equals $700.
Your gross profit margin can be seen as dollars or as a percentage. As a percentage, the gross profit margin is a percentage of net sales.
Total sales (Revenue) - Cost of Sales = Gross Profit Margin
We can give you good advice about the price. Please see Black Show Hair Drop Shipping
Step Four: Register Your Business
Choosing a name for your business is a significant step. You want to be sure your business name is understandable and conveys what your virgin hair business does. Your hair business name should also be catchy enough to remember. Taking this step formalizes your business and ensures no one else can use your name.
When you register your business name you’re not only complying with the laws that require this step, it also protects you. Once you register your business name, no one can use it. There are three ways to register your business name.
Register as a (DBA) Doing Business As
Registering your business as a business name is also known as registering as a fictitious business name. You must register with your state or county clerk’s office. First, you will need to do a business name search to ensure another business is not using the name. If you are using your legal name as your business name, registering a business name is not required.
Any other name must be registered to prevent others from using it, and so people can determine who owns the business.
When considering how to register a business name, you will need to decide on what business structure is most suitable for your virgin hair business.
Creating an LLC or a corporation.
- File your articles of incorporation or articles of organization with your state.
- Register a Trademark (Optional)
- When you trademark your business name with your state, you receive additional protection if another company attempts to use your business name within your state. Federal trademark registration protects every state.
- You must apply with the United States Patent and Trademark Office. Be sure no one else has trademarked a similar name, or your applications rejected.
- Register for EIN
- Determine Your Eligibility
- You can apply for your EIN online if your business located in the United States or the U.S.
- You must have a valid Taxpayer ID Number (SSN, ITIN, EIN).
- You must complete the application in one session.
- Your session expires as 15 minutes of inactivity; you will have to start over.
- After all, validations you will get your EIN immediately upon completion. You can then download, save, and print your EIN confirmation notice.
Brand Your Company
Once you have completed the steps above, it’s time to begin branding your company. Logo, website address (URL), website, business card, hair tags, etc.
Start Doing Business
Starting a hair business is exciting! Having everything in order before sharing your virgin hair business with the world，ensures smooth operations once you get your first sale! Using the ultimate guide to starting a virgin hair business will provide the correct steps to your journey as an entrepreneur and business owner. Have any questions ask Black Show Hair below!