How to Start a Lip Gloss Business: Get Into the Cosmetic Industry

Date published: January 10, 2024

Are you a makeup enthusiast? If so, you may be wondering how to start your own lip gloss company. Follow this comprehensive guide to begin your entrepreneurial journey.

Best Practices

Financial Preparation

Business Tips

Starting your own lip gloss business can be an exciting journey. The lip gloss industry is cost-effective, fast, and uncomplicated because you don’t need significant capital or an investor to start your beauty business. If you are wondering how to start a lip gloss company, follow along to begin your journey towards business ownership.

Why Start a Lip Gloss Business?

Lip gloss was first introduced to the public in 1930 by the Max Factor Company. After almost a century, the beauty industry is growing more than ever. According to Statista, 122.62 million women in the U.S. used lipstick and lip gloss in 2020. This figure is projected to increase to 124.68 million in 2024. Moreover, studies predict that people will continue to use more beauty products causing demand growth over the following years. As a result, the lipstick industry is expected to value about $10 billion by 2024.

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Statistics also show 4,082 Cosmetic and Beauty Products Manufacturing businesses in the US as of 2022, an increase of 3.6% from 2021. Therefore, starting a lip gloss business line can be a rewarding journey for a young entrepreneur. It is one of the best business ideas for teens.

Benefits of Starting a Lip Gloss Business

Operating a lip gloss business has many benefits, but we have outlined the most important ones that will help you move forward confidently:

• Lucrative Market: The beauty and cosmetics industry is a lucrative market with a consistent demand for new products.
• Low Entry Barriers: Starting a lip gloss business typically requires relatively low startup costs compared to many other businesses in the beauty industry.
• Social Media Marketing: Beauty products are highly shareable on social media, enabling you to leverage this for marketing and brand exposure.
• Low Seasonal Impact: The demand for lip gloss remains relatively stable throughout the year, reducing the impact of seasonality.
• High-Profit Margins: Cosmetics, including lip gloss, often offer healthy profit margins, especially when sold directly to consumers or through e-commerce channels.

How to Get Started with Lip Gloss Business

Creating a lip gloss line offers several potential avenues to explore:

1. Collaborate with a private cosmetics supplier and establish yourself as a lip gloss distributor.
2. Seek out a private-label manufacturer specializing in lip gloss to bring your brand to life.
3. Craft your unique lip gloss products entirely from scratch, showcasing your creative prowess and innovation.

Each of these models has benefits and disadvantages for your entrepreneurial journey, so let’s take a closer look at how they work.

Method 1: Become a Lip Gloss Distributor

This business model doesn’t require any capital investment to start making money, and the process of becoming a lip gloss distributor is relatively easy. All you must do is find lip gloss brands like Avon and Mary Kay, apply to become a distributor and sell the products. These vendors for lip gloss will also provide you with resources and sales materials to help you get started. After all, the more distributors a company has, the more products it will sell.

Method 2: Work With a Private Label Manufacturer

A private label manufacturer produces the lip glosses for you and adds your brand name to the packaging. You have complete control over choosing the colors, packaging, scent, quality, and all the aspects of developing your lip gloss. This business model is very cost-effective because the solutions and materials used to make the lip gloss may have already been approved by the FDA. However, note that some private label companies have a minimum number of products you can buy, which may be a lot when you first start your business.

Method 3: Start from Scratch

Starting a lip gloss line from scratch is the most challenging yet rewarding option. You will need to purchase all the materials required to make your lip gloss and brand your products yourself. It would be best to experiment with different formulas before you start to sell. Until you have enough money to hire other people, you will be running your entire business yourself.

If you want to make your lip gloss, you have two options: you can either buy a lip gloss starter kit or buy all the ingredients separately. Either way, it’s important to make sure your product meets all requirements listed under the Federal Food, Drug, and Cosmetic Act.

Lip Gloss Starter Kit

There are many lip gloss starter kits available for every taste and budget. The kits include a few hundred units of private-label lip gloss, tubes in different sizes, ingredient stickers, oils, micas, pigments, and other necessary items. Prices can range from $50 to $ 1,000.

Ingredients You Need to Make Lip Gloss

Creating homemade lip gloss from scratch can be a straightforward process that requires just a handful of essential ingredients and tools. Here's a breakdown of what you'll need:

Ingredients

1. Natural or Synthetic Oil: Your lip gloss's primary base comes from using natural or synthetic oil. This imparts the gloss with its signature slippery and moist texture. Opting for a moisturizing oil like coconut oil not only enhances the product's quality but also offers additional skin benefits. For those desiring a thicker consistency, consider incorporating wax or clay into the mixture.
2. Natural or Synthetic Pigment: To add color to your lip gloss, include natural or synthetic pigments. Feel free to blend multiple colors to achieve your desired shade. For those aiming to infuse extra shine or sparkle into their gloss, fine or larger glitters are excellent choices.

Safety Tip: Before experimenting with your homemade lip gloss, we strongly recommend seeking professional guidance to ensure its safety and quality, especially if you intend to use it on yourself or others.

Here is a list of some of the ingredients and tools needed to make lip gloss to sell:

• Base

The base is the foundation of any lip gloss. Usually, it has a transparent color. But you can add dyes, glitter, and other pigments to the base to make it unique and original.

• Different Types of Natural Oils

There are different types of oils that you can add to your lip gloss base. The most popular oils used in lip glosses are coconut oils, olive oil, castor oil, and almond oil. These oils are also known for their nourishing properties.

• Waxes

Different types of wax can be added to your base and natural oils, depending on how thick you want your gloss to be. The most popular choices are beeswax, candelilla wax, and carnauba wax. All three options have to soften properties and provide a glossy finish. However, avoid utilizing beeswax if you are marketing your products to the vegan or cruelty-free community.

• Clays

You could also use a mix of clays to make your lip gloss’s consistency even thicker. The three clay families used for cosmetic purposes are kaolinite, illite, and smectite. Each clay is used for different purposes.

• Flavoring Oils

If you like to add extra taste and scent to your lip glosses, then flavoring oils are a great option. You can also mix oils to create unique flavors like strawberry vanilla or mint chocolate.

• Liquid Lip Dyes

You can add liquid lip dyes to your lip gloss base to get your desired color. You can also use different pigments and mix them to get the shade you want.

• Wand Tubes or Squeeze Tubes

Once you have formulated your lip gloss, you need to store it in a container. Then, depending on your customer’s preference, you could sell your lip glosses in wand tubes or squeeze tubes. As the name indicates, a wand tube comes with a small wand-like applicator that you use to apply on your lips. Unlike a wand tube, a squeeze tube doesn’t have an applicator. Instead, it has a small hole through which you squeeze the gloss out onto your lips.

• Pipettes and Syringes

Pipettes and syringes will help you measure and transfer your finished product into the wand or squeeze tube. As your business grows, you can purchase an automatic or semi-automatic filling machine for higher levels of precision and improved speed with the help of equipment financing.

Decide Your Niche in the Beauty Industry

Now that you know how to make a lip gloss, you need to decide to whom you would like to sell your products. For example, if you want to make subtle lip glosses, it is better to target a professional audience. On the other hand, if your goal is to create lip glosses that pop and have a fruity taste, it might be better to target the younger generation.

You could also work the other way around. You could determine your niche and then create the lip gloss targeted to their needs. Knowing your niche will help you market effectively and keep costs down.

Know Your Competition

Competition in the beauty industry is high, and it is projected to keep growing. Moreover, the competition goes beyond your city or country. It is also international because lip gloss brands worldwide can be found in cosmetics stores across the U.S. and online. However, if you have done your due diligence and know your target market, you can grow and advance in the industry with the right marketing strategies.

Create Your Business Name and Logo

Branding is what will make you stand out among your competitors. Your brand name and logo are essential elements alongside product quality and marketing strategy. Your name is one of the main components of how others perceive your brand.

That’s why you should be creative and come up with a name related to your brand that’s catchy and easy to remember. Ideally, pick at least three names for your business and share the list with close friends and family. Then, ask for their feedback to understand how people perceive them and choose the best alternative. Your brand's perceptions will play a crucial role in establishing and maintaining loyalty to your brand in the long run.

If you have design skills, you can create your logo. If not, you can take advantage of online logo-generating services or hire a freelance graphic designer. Also, make sure that your lip gloss branding labels are in a proper size proportional to your tubes.

Register Your Business

The next step is to register your business. Popular options for a lip gloss production business include a limited liability company (LLC), partnership, or sole proprietorship.

Establishing an LLC protects the business owner from personal liabilities. If something goes wrong in the business, your personal belongings are protected. Only the money you put into your business will be at risk. For example, if one of your customers has an allergic reaction to your product and decides to sue you, the LLC may protect you as an individual.

Moreover, operating an LLC is simpler and more flexible than other alternatives. If you want to compete more effectively and grow your lip gloss production, starting with an LLC and then changing it to an “S” business enterprise or a “C” company might be the best option. By making the switch, you can transfer the company’s ownership more easily, enjoy a separate tax structure, and have flexibility in ownership.

A partnership is a good option if you start your lip gloss company with two or more friends. However, you will have unlimited personal liability. This means that if someone sues your business, you and your partners may lose your personal belongings.

A sole proprietorship is suitable for new companies with no employees. However, you are personally liable for any damages. Moreover, if you take your business seriously and have intentions to grow, then choosing a sole proprietorship may stand in your way.

Legal Requirements

Legal requirements will vary depending on your location and type of business. If you are making lip gloss from scratch, you need to ensure that your products meet quality and safety standards. The U.S. Food and Drug Administration (FDA) regulates the cosmetics industry; hence, all color additives, labeling, and packaging must be approved by the FDA for the intended use.

For example, if you want to sell organic lip glosses, you should follow FDA regulations for safety and U.S. Department of Agriculture (USDA) laws for organic products. For instance, you can only use the term “organic” if at least 95% of the ingredients used in your lip gloss are organic.

If you want to become a lip gloss distributor or sell private-label lip gloss, you don’t have to worry about this matter. The FDA has already approved these goods.

Moreover, you need the proper documentation to run a successful business. To legally operate your lip gloss company in the U.S., you need to obtain the following legal documents:

• Certificate of Incorporation
• Business License
• Employee Identification Number
• Tax Identification Number
• Business plan
• Doing Business As (DBA) License
• Insurance Policy

Protect Your Intellectual Property with Trademark and Copyrights

Everything starts with protecting your business idea. Then you need to protect your label, design, and style, or else anyone can successfully fake it or create similar products and make money from your brand name. So, visit the United States Patent and Trademark Office (USPTO) and fill out a patent application form to protect your intellectual property or secure a trademark for your company.

Get the Best Insurance Policies for You

As your lip gloss company grows, you’ll need insurance to protect your business. Even if you have an LLC, your business can be sued. Discuss with an agent to understand the best insurance policies. The two most popular insurance policies that lip gloss business owners get are general liability insurance to protect themselves from lawsuits against the company and product liability insurance if a customer injures themselves by misusing the product.

Get the Necessary Certification

You don’t need any professional certification to operate a lip gloss company successfully. However, you will do yourself a big favor if you enroll in a cosmetology school before starting your business. Studying cosmetology will help you better understand the industry so you can create a quality product.

Decide Where You Will Sell Your Lip Gloss

There are two main avenues for selling cosmetics: online and in-store. They are not mutually exclusive, and many small operations succeed with both options. Here’s what you should know before going in either direction.

Online

Launching and selling lip gloss online can significantly reduce your operational costs. Here are some effective strategies to kickstart your online lip gloss business:

1. Leverage Social Media

• Establish a dedicated business presence on Instagram, showcasing captivating images of your lip gloss products. Utilize relevant hashtags to expand your reach and attract more followers.
• Build anticipation and curiosity by creating teasers or promotional videos before launching new products. Engage your audience and generate hype.

2. Create a Professional Website

• Develop a professional website that serves as your online storefront. Ensure that it provides visitors with a seamless browsing experience.
• Showcase your lip gloss products, provide detailed product descriptions, and offer a convenient shopping cart feature for easy purchases.

3. Strategic Partnerships

• Collaborate with other websites and platforms catering to your target customer base. Partnering with complementary businesses can expand your reach and customer base.

4. Explore Online Marketplaces

• Consider establishing your personalized online store on popular e-commerce platforms such as Shopify, Etsy, Amazon, Squarespace, or Wix. These platforms offer user-friendly tools to help you market and sell your handmade lip gloss products effectively.

By implementing these strategies, you can effectively launch and grow your online lip gloss business, reaching a wider audience and maximizing your online sales potential.

Storefront

Before opening your brick-and-mortar store, consider the set-up costs such as décor, lip gloss business cards, rent, and utilities. The location you choose to operate your lip gloss business is the key to your success. You should select a suitable place for your business where your target niche can easily access your store.

However, even if you open a store, it’s a good idea to have a website and promote your product on your social media platforms. Advertise online, offer special discounts, and build a solid social media presence. Encourage your customers to spread the word about your products and reward them with incentives.

How Much Money You Will Need to Start a Lipstick Business?

The investment required to start a lipstick business can vary widely depending on factors such as the scale of the operation, location, and business model. On average, you may need anywhere from $5,000 to $20,000 or more to start a small to medium-sized lipstick business. This amount would cover all the things we mentioned above starting from product development and manufacturing to branding and packaging. Many startups may face financial hardships during their first stages, so it is more common to consider startup business loans as a way of solution. Keep in mind that these costs can significantly vary, and it's essential to create a detailed business plan to determine your specific startup costs based on your business goals and the market you intend to target.

Sum Up

Starting your lip gloss business can take many forms. You can choose to become a lip gloss distributor, work with a private label manufacturer, or make your own lip gloss from scratch. No matter which route you choose, starting your lip gloss business can be done inexpensively. Make sure you get all the required licenses, permits, and the approval of the FDA, and focus on the creativity of your marketing to attract new customers and make more money.

Ethan James Lead Writer

Ethan James is an experienced Financial Writer at Lendza with over a decade of experience.

Starting your own lip gloss business is cost-efficient and a relatively easy venture to jumpstart — with the right tips and tools, like quality lip gloss labels, of course. So what do you need to make it come to life? Let’s jump right in.

Understand Your Market & Define Your Niche

Lip gloss is purchased by most age groups and has no cultural barriers. This offers you a very broad market to "play" in, and also enables you to define your niche within that space.

Think about what makes your lip gloss unique: Is it intended for a certain audience? Created with clean ingredients? Develop a product (or product line) and market it around what makes the product special, or who the product is catered toward.

For example, maybe your product is great for pre-teens who are experimenting with makeup for the first time. Clean ingredients may appeal to the parents who are purchasing the product, and cool branding toward that specific age group could make them feel special and want to buy something "created for them."

Know the Regulations

While the FDA doesn’t technically regulate cosmetic products (you don’t need FDA approval before going to market), they do regulate cosmetic labels under the Fair Packaging and Labeling Act (FPLA).

The FPLA prohibits cosmetics from being compromised in safety or effectiveness and from being misbranded. Essentially, you can’t lie to your customers.

You can find a list of restricted ingredients and a few tips and suggestions to stay FDA-compliant in our article, "What are the FDA Labeling Requirements for Cosmetic Products?"

Get Equipment, Ingredients & a Sales Platform

What do you need to make all of this happen? Let’s start with equipment. You’ll need to invest in a blending/mixing machine, molding equipment, pipettes and syringes for accurate measuring, packaging, and a sealing machine.

For supplies, your ingredients can vary — that’s part of what makes your product unique. Some notable bases include:

• Coconut oil: moisturizing
• Olive oil/grape seed oil: skin barrier protection
• Vitamin E essence: helps dryness and skin regeneration
• Beeswax: sun and UV protection
• Cocoa butter/shea butter: hydration
• Mica pigments (purified): color sheen

This may seem obvious, but keep in mind that you’re creating a lip product so any additional scents, coloring, etc., must be safe for consumption. Safety should always be your top priority.

Last but not least, you need a sales platform. This enables you to sell your product to a wide audience (online) and gives you a place to direct your marketing efforts.

There are plenty of easy-to-create e-commerce storefronts such as Etsy or Shopify, or you can build a website using platforms like Wix, SquareSpace, or Wordpress which also have e-commerce add-on options.

Price Your Products

There are many factors to consider when pricing any kind of product, but beauty can have some unique standards.

While many small businesses or startups may price their products low to attract customers, in the beauty world, low prices are often equated with poor quality ingredients. If you use clean or pricier ingredients, your prices should reflect that.

It’s a fine line, you don’t want to price too high, either. Think about your target audience, and if you’re able, ask a sample of that group about the prices you have in mind. Using the pre-teen example, you could ask a few moms of that audience to see what they would be willing/think is appropriate to pay for your product.

Branding & Labels

Don’t underestimate the power of a good label. People can be drawn to branding and packaging before they even know what the product is. You just need to catch their attention.

The first and most important step is figuring out your brand and its "vibe." What colors, designs, or words (or none of the above) do you want to reflect your brand? Who is your brand if it were a person? What is your message? Who is your ideal audience? Take these bits and pieces and use it to create something simple but memorable. Easier said than done, I know. But I promise it’s worth the time and effort.

Once you have an idea of the brand as a whole, start thinking about your product label and packaging. What experience do you want your audience to have opening your product? What do you want the label to look like?

Keep in mind that the label needs to be legible, so words should be easy to read (no crazy fonts) and colors need to be clear and work together.

We hope this article was helpful for you as you endeavor to start your very own lip gloss business.

When you’re ready to design your label, explore different sizes, templates, and lip gloss labels that are quick and easy to create!