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Do you want to start eyelash extension business?
Planning how to start your own eyelash business? This is a great business considering the U.S beauty industry generates more than $60 billion. Thanks to recent technology advancements, the eyelash extension business has really become popular and is among the fastest growing sectors in the beauty industry. This is due to the fact that many clients are keen on non-surgical and non-invasive beauty enhancements. With a good business plan, you can make good money from this business that demands a lot of creativity and passion.
Executive Summary
2.1 The Business
The eyelash extension business will be registered under the name Flawless Lounge Inc. and will be located in downtown Nashville, Tennessee. The business will be owned by Joan Stuggard who is a professional and experienced beauty therapist. When opening this business, it is good to have unique and attractive lash business name ideas to capture the attention of your customers.
2.2 Management Team
Before starting an eyelash business, Joan Stuggard worked as professional beauty therapist with cumulative work experience of 17 years. She has extensive technical skills and has offered her expertise in numerous establishments she has worked for in the course of her career.
2.3 Customer Focus
Joan has an in-depth understanding of how the eyelash extension industry works. Given her long experience in the industry, she knows who is really in need of these services. Her customers are primarily women and people of all ages who wish to have beautiful and professionally made eyelash extension.
2.4 Business Target
Joan Stuggard has identified the market segments she has to pay specific focus to in order to maximize revenue for her business. Her target is to sell her services to the most appropriate market segments in need of eyelash extension services.
Company Summary
3.1 Company Owners
Joan Stuggard is an experienced beauty therapist with extensive skills in various forms of beauty therapy including eyelash extension. In the course of her career, Joan had a chance to work for reputable beauty companies where she took an active role in coming up with pioneering beauty designs and concepts. After having been in the industry close to 2 decades, she decided it was time to think about her own eyelash extension business opportunity.
3.2 Aim of Staring the Business
After seeing the increasing acceptance of eyelash extension by many customers across the beauty industry, Joan realized it was the perfect time to think about starting eyelash extension business. Considering Nashville is a large city, there was definitely a good market for the business to tap into. Nowadays, customers prefer natural non-surgical beauty enhancements.
3.3 How the Business will be started
Flawless Lounge will launch operations after the successful completion of an extensive market research. In order to actualize her dreams, Joan knows she has to excel in business set-up, administration and financial management. For this reason, she has hired a team of financial experts to help her come up with a comprehensive financial roadmap.
| Start-up Expenses | ||
| Legal | $3,000 | |
| Consultants | $6,000 | |
| Insurance | $22,000 | |
| Rent | $9,000 | |
| Research and Development | $14,000 | |
| Expensed Equipment | $12,000 | |
| Signs | $4,000 | |
| TOTAL START-UP EXPENSES | $63,000 | |
| Start-up Assets | $0 | |
| Cash Required | $140,000 | |
| Start-up Inventory | $50,000 | |
| Other Current Assets | $24,000 | |
| Long-term Assets | $7,000 | |
| TOTAL ASSETS | $22,000 | |
| Total Requirements | $25,000 | |
| START-UP FUNDING | $0 | |
| START-UP FUNDING | $100,000 | |
| Start-up Expenses to Fund | $30,000 | |
| Start-up Assets to Fund | $27,000 | |
| TOTAL FUNDING REQUIRED | $0 | |
| Assets | $18,000 | |
| Non-cash Assets from Start-up | $12,000 | |
| Cash Requirements from Start-up | $0 | |
| Additional Cash Raised | $50,000 | |
| Cash Balance on Starting Date | $25,000 | |
| TOTAL ASSETS | $0 | |
| Liabilities and Capital | $0 | |
| Liabilities | $0 | |
| Current Borrowing | $0 | |
| Long-term Liabilities | $0 | |
| Accounts Payable (Outstanding Bills) | $0 | |
| Other Current Liabilities (interest-free) | $0 | |
| TOTAL LIABILITIES | $0 | |
| Capital | $0 | |
| Planned Investment | $0 | |
| Investor 1 | $40,000 | |
| Investor 2 | $60,000 | |
| Other | $0 | |
| Additional Investment Requirement | $0 | |
| TOTAL PLANNED INVESTMENT | $160,000 | |
| Loss at Start-up (Start-up Expenses) | $50,000 | |
| TOTAL CAPITAL | $45,000 | |
| TOTAL CAPITAL AND LIABILITIES | $40,000 | |
| Total Funding | $230,000 | |
Services for Customers
Flawless Lounge Inc. intends to diversify its range of services in order to become more competitive and attract more customers. Joan knows how to start your own lash company involves maximizing your creativity and offering a unique range of services that makes you stand out from your competitors. Considering her experience and knowledge of the industry and trends, Flawless Lounge has an advantage that should help the business achieve its goals. The following products and services will be offered by Flawless Lounge.
- Eyelash Extensions which are safe and customized
- Tinting and Threading
- Selling eyelash extension products
Marketing Analysis of Eyelash Extension Business
In the recent times, the number of people seeking eyelash extension services has increased. With various forms of beauty therapy becoming more common, many people are increasingly seeking to transform their appearance through simple techniques as opposed to medical procedures which are considered invasive. In this eyelash extension business plan, Flawless Lounge has identified an untapped market it can capitalize on to generate revenue. Women across the age bracket have developed a keen interest in eyelash extension services creating a good opportunity for the business. In this regard, the business has carried out an extensive market study and analysis for purposes of planning.
5.1 Market Segment
For Flawless Lounge to achieve its revenue targets, the eyelash extension business has identified various market segments it needs to market its product and services. In this lash business plan, potential market segments have been defined with a clear marketing plan of reaching out to them.
5.1.1 Individual Customers
Walk-in customers are expected to be the largest target market that Flawless Lounge must find creative ways of reaching out to. Nashville is a large city with a high number of individuals who will regularly need eyelash extension services. With increased awareness about beauty procedures, the number of people interested in eyelash extension has gone up. Any good eyelash extension business plan example should adequately specify the strategies needed to attract this clientele to the business. This is definitely a lucrative market considering the potential high number of customers the business is likely to gain. Apparently, it is also the most competitive segment so Flawless Lounge has to position itself strategically to benefit from this segment.
5.1.2 Beauty Parlors
Beauty parlors potentially present a good revenue source for the eyelash extension business. Flawless Lounge sells eyelash extension products which are required for various beauty parlors across the city to serve their customers. The advantage of this segment is most beauty parlors are likely to make regular and consistent bulk orders for products which generates a good amount of revenue for the business.
5.1.3 Cosmetic Shops
Cosmetic shops stock a wide variety of items including eyelash extensions which are sold to individual customers and other beauty related businesses. Flawless Lounge should put in place strategies to work closely with cosmetic shops because they have access to a wide market the eyelash extension business can tap into.
5.1.4 Make-up Artists
Make-up artists work extensively with different products including eyelash extensions. Flawless Lounge can creatively come up with a plan of identifying various make-up artists and their business entities with an aim of marketing both the products and services of the business.
| Market Analysis | |||||||||
| Potential Customers | Growth | YEAR 1 | YEAR 2 | YEAR 3 | YEAR 4 | YEAR 5 | CAGR | ||
| Individual customers | 35% | 30,000 | 32,000 | 34,000 | 36,000 | 38,000 | 10.00% | ||
| Beauty Parlors | 30% | 25,000 | 27,000 | 29,000 | 31,000 | 33,000 | 14.00% | ||
| Cosmetic shops | 20% | 20,000 | 22,000 | 24,000 | 26,000 | 28,000 | 12.00% | ||
| Make-up artists | 15% | 15,000 | 17,000 | 19,000 | 21,000 | 23,000 | 9.00% | ||
| Total | 100% | 90,000 | 98,000 106,000 | 114,000 | 122,000 | 18.00% | |||
5.2 Business Target
Flawless Lounge intends to set-up shop in Nashville which is a highly populated city with numerous opportunities for the business to explore. In this lash extension business plan, Flawless Lounge hopes to realize an annual sales growth of between 15%-18% in the first three years of operation.
5.3 Product Pricing
The best approach of how to start a eyelash extensions business involves carrying out an extensive market study in order to come up with an accurate and profit oriented pricing strategy.
Strategy
Flawless Lounge Inc. intends to formulate a well-researched and effective marketing business strategy to help the business satisfactorily cover all the intended target markets. Setting up eyelash extension business requires the implementation of good marketing strategies to help the business market its products and services to as many customers as possible.
6.1 Competitive Analysis
Flawless Lounge Inc. has done an extensive market research to come up with the best strategies to help the business achieve consistent growth, compete effectively and remain relevant in the industry.
6.2 Sales Strategy
For Flawless Lounge Inc. to effectively reach out to the market, the eyelash extension business intends to implement the following strategies to advertise its brand.
- Advertise the eyelash extension business on local directory listings
- Send introductory letters to business in the beauty industry to create awareness about the eyelash extension business
- Advertise the business on social media platforms such as Facebook, Twitter and Instagram. Use Google Ads to market the business to an online audience
- Design a simple search engine optimized website to improve online presence and rank higher in search engine results
- Advertise the eyelash extension business on local print and broadcast channels such as radio, television and newspapers
- Encourage word of mouth marketing especially by offering good services to have referrals for the business
6.3 Sales Forecast
How to start your own eyelash extension business and have a clear vision requires coming up with a comprehensive sales forecast.
| Sales Forecast | |||
| Unit Sales | Year 1 | Year 2 | Year 3 |
| Eyelash extensions | 300,000 | 310,000 | 320,000 |
| Tinting and threading | 310,000 | 320,000 | 330,000 |
| Selling eyelash extension products | 200,000 | 220,000 | 240,000 |
| TOTAL UNIT SALES | 810,000 | 840,000 | 870,000 |
| Unit Prices | Year 1 | Year 2 | Year 3 |
| Eyelash extensions | $400.00 | $420.00 | $440.00 |
| Tinting and threading | $250.00 | $270.00 | $290.00 |
| Selling eyelash extension products | $200.00 | $220.00 | $240.00 |
| Sales | |||
| Eyelash extensions | $310,000 | $340,000 | $370,000 |
| Tinting and threading | $150,000 | $180,000 | $210,000 |
| Selling eyelash extension products | $100,000 | $140,000 | $180,000 |
| TOTAL SALES | |||
| Direct Unit Costs | Year 1 | Year 2 | Year 3 |
| Eyelash extensions | $5.00 | $4.00 | $3.00 |
| Tinting and threading | $3.00 | $2.00 | $1.00 |
| Selling eyelash extension products | $2.00 | $3.00 | $4.00 |
| Direct Cost of Sales | |||
| Eyelash extensions | $300,000 | $320,000 | $340,000 |
| Tinting and threading | $200,000 | $220,000 | $240,000 |
| Selling eyelash extension products | $150,000 | $170,000 | $190,000 |
| Subtotal Direct Cost of Sales | $900,000 | $980,000 | $1,060,000 |
Personnel Plan
If you plan to start your own eyelash business, you need to have a team of well-trained and experienced staff to help you manage the business. Joan has realized she can’t run the business alone and requires a competent team to support her. In this regard, a personnel plan has been established to identify the best team to run Flawless Lounge Inc.
7.1 Personnel Plan
To help the eyelash extension business achieve business growth and success, the following team of staff will be hired to work in the business. Joan Stuggard who is the owner of the eyelash extension business will be the Chief Executive Officer in charge of management and administration. She will be assisted by the following personnel in various departments.
- 1 Assistant Manager
- 3 Lash Technicians
- 1 Accountant/Cashier
- 2 Sales and Marketing Executives
- 1 Customer Service Executive
- 1 Delivery Executive
Successful applicants will undergo comprehensive training a few weeks before the business officially opens its doors to the public.
7.2 Average Salaries
Flawless Lounge Inc. intends to pay its members of staff the following salaries within the first three years of operation.
| Personnel Plan | |||
| Year 1 | Year 2 | Year 3 | |
| 1 assistant manager | $24,000 | $26,000 | $28,000 |
| 3 Lash technicians | $75,000 | $77,000 | $79,000 |
| 1 Accountant | $22,000 | $24,000 | $26,000 |
| 2 Sales and Marketing Executive | $50,000 | $54,000 | $58,000 |
| 1 Client Service Executive | $20,000 | $20,000 | $20,000 |
| 1 Delivery executive | $22,000 | $24,000 | $26,000 |
| 1 Cashier | $20,000 | $22,000 | $24,000 |
| Total Salaries | $233,000 | $247,000 | $261,000 |
Financial Plan
Flawless Lounge Inc. has come up with a comprehensive financial plan which is important when starting your own eyelash extension business. It is critical to make strategic financial decisions and analyze various parameters before opening a business. In this case, Joan Stuggard intends to raise most of the business capital from her personal savings. However, has two investors who will provide a share of the initial capital to start the eyelash extension business. In addition, a bank loan for business plan shall be sought to finance the budget deficit. Starting my own eyelash extension business demands the formulation of a clear financial roadmap to guide business operations.
Below is a comprehensive financial analysis for Flawless Lounge Inc.
8.1 Important Assumptions
The financial forecast for Flawless Lounge Inc. is based on the assumptions below.
| General Assumptions | |||
| Year 1 | Year 2 | Year 3 | |
| Plan Month | 1 | 2 | 3 |
| Current Interest Rate | 14.00% | 16.00% | 18.00% |
| Long-term Interest Rate | 5.00% | 5.00% | 5.00% |
| Tax Rate | 12.00% | 15.00% | 19.00% |
| Other | 0 | 0 | 0 |
8.2 Brake-even Analysis
Flawless Lounge Inc. brake-even analysis is shown in the graph below.
| Brake-Even Analysis | ||
| Monthly Units Break-even | 5000 | |
| Monthly Revenue Break-even | $230 | |
| Assumptions: | ||
| Average Per-Unit Revenue | $175.00 | |
| Average Per-Unit Variable Cost | $2.00 | |
| Estimated Monthly Fixed Cost | $243,000 | |
8.3 Projected Profit and Loss
Profit and loss information for Flawless Lounge Inc. as calculated on a monthly and annual basis is indicated below.
| Pro Forma Profit And Loss | |||
| Year 1 | Year 2 | Year 3 | |
| Sales | $820,000 | $840,000 | $860,000 |
| Direct Cost of Sales | $100,000 | $120,000 | $140,000 |
| Other | $0 | $0 | $0 |
| TOTAL COST OF SALES | $920,000 | $960,000 | $1,000,000 |
| Gross Margin | $420,000 | $450,000 | $480,000 |
| Gross Margin % | 65.00% | 70.00% | 75.00% |
| Expenses | |||
| Payroll | $230,000 | $260,000 | $290,000 |
| Sales and Marketing and Other Expenses | $6,000 | $8,000 | $10,000 |
| Depreciation | $4,000 | $6,000 | $8,000 |
| Leased Equipment | $0 | $0 | $0 |
| Utilities | $6,000 | $8,000 | $10,000 |
| Insurance | $2,000 | $2,500 | $3,000 |
| Rent | $8,000 | $10,000 | $12,000 |
| Payroll Taxes | $25,000 | $28,000 | $31,000 |
| Other | $0 | $0 | $0 |
| Total Operating Expenses | $320,000 | $350,000 | $380,000 |
| Profit Before Interest and Taxes | $100,000 | $130,000 | $160,000 |
| EBITDA | $40,000 | $60,000 | $80,000 |
| Interest Expense | $0 | $0 | $0 |
| Taxes Incurred | $30,000 | $35,000 | $40,000 |
| Net Profit | $120,000 | $140,000 | $160,000 |
| Net Profit/Sales | 40.00% | 50.00% | 60.00% |
8.3.1 Monthly Profit
8.3.2 Yearly Profit
8.3.3 Monthly Gross Margin
8.3.4 Yearly Gross Margin
Profit and Loss Analysis for Flawless Lounge Inc. is illustrated below.
8.4 Projected Cash Flow
Below is a summary of Flawless Lounge Inc. Pro forma cash flow, subtotal cash received, subtotal cash spent, subtotal cash from operations and subtotal cash spent on operations.
| Pro Forma Cash Flow | |||
| Cash Received | Year 1 | Year 2 | Year 3 |
| Cash from Operations | |||
| Cash Sales | $100,000 | $120,000 | $140,000 |
| Cash from Receivables | $10,000 | $14,000 | $18,000 |
| SUBTOTAL CASH FROM OPERATIONS | $110,000 | $134,000 | $158,000 |
| Additional Cash Received | |||
| Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
| New Current Borrowing | $0 | $0 | $0 |
| New Other Liabilities (interest-free) | $0 | $0 | $0 |
| New Long-term Liabilities | $0 | $0 | $0 |
| Sales of Other Current Assets | $0 | $0 | $0 |
| Sales of Long-term Assets | $0 | $0 | $0 |
| New Investment Received | $0 | $0 | $0 |
| SUBTOTAL CASH RECEIVED | $80,000 | $85,000 | $90,000 |
| Expenditures | Year 1 | Year 2 | Year 3 |
| Expenditures from Operations | |||
| Cash Spending | $15,000 | $20,000 | $25,000 |
| Bill Payments | $18,000 | $21,000 | $24,000 |
| SUBTOTAL SPENT ON OPERATIONS | $33,000 | $41,000 | $49,000 |
| Additional Cash Spent | |||
| Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
| Principal Repayment of Current Borrowing | $0 | $0 | $0 |
| Other Liabilities Principal Repayment | $0 | $0 | $0 |
| Long-term Liabilities Principal Repayment | $0 | $0 | $0 |
| Purchase Other Current Assets | $0 | $0 | $0 |
| Purchase Long-term Assets | $0 | $0 | $0 |
| Dividends | $0 | $0 | $0 |
| SUBTOTAL CASH SPENT | $33,000 | $41,000 | $490,000 |
| Net Cash Flow | $15,000 | $18,000 | $21,000 |
| Cash Balance | $20,000 | $24,000 | $30,000 |
8.5 Projected Balance Sheet
Below is a Projected Balance Sheet for Flawless Lounge Inc. that shows assets, liabilities, capital, long term assets and current liabilities.
| Pro Forma Balance Sheet | |||
| Assets | Year 1 | Year 2 | Year 3 |
| Current Assets | |||
| Cash | $280,000 | $320,000 | $360,000 |
| Accounts Receivable | $12,000 | $16,000 | $20,000 |
| Inventory | $5,000 | $7,000 | $6,000 |
| Other Current Assets | $5,000 | $5,000 | $5,000 |
| TOTAL CURRENT ASSETS | $302,000 | $348,000 | $391,000 |
| Long-term Assets | |||
| Long-term Assets | $12,000 | $15,000 | $18,000 |
| Accumulated Depreciation | $14,000 | $16,000 | $18,000 |
| TOTAL LONG-TERM ASSETS | $4,000 | $3,000 | $2,000 |
| TOTAL ASSETS | $332,000 | $382,000 | $429,000 |
| Liabilities and Capital | Year 1 | Year 2 | Year 3 |
| Current Liabilities | |||
| Accounts Payable | $20,000 | $24,000 | $28,000 |
| Current Borrowing | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 |
| SUBTOTAL CURRENT LIABILITIES | $20,000 | $24,000 | $28,000 |
| Long-term Liabilities | $0 | $0 | $0 |
| TOTAL LIABILITIES | $22,000 | $26,000 | $30,000 |
| Paid-in Capital | $27,000 | $27,000 | $27,000 |
| Retained Earnings | $20,000 | $30,000 | $40,000 |
| Earnings | $80,000 | $100,000 | $120,000 |
| TOTAL CAPITAL | $220,000 | $240,000 | $260,000 |
| TOTAL LIABILITIES AND CAPITAL | $210,000 | $230,000 | $270,000 |
| Net Worth | $400,000 | $420,000 | $440,000 |
8.6 Business Ratios
The following is the Ratio Analysis, Business Ratios and Business Net Worth for Flawless Lounge Inc.
| Ratio Analysis | ||||
| Year 1 | Year 2 | Year 3 | INDUSTRY PROFILE | |
| Sales Growth | 12.00% | 40.00% | 60.00% | 6.00% |
| Percent of Total Assets | ||||
| Accounts Receivable | 7.00% | 4.00% | 3.00% | 11.00% |
| Inventory | 5.00% | 3.00% | 2.00% | 10.00% |
| Other Current Assets | 4.00% | 3.50% | 2.20% | 28.00% |
| Total Current Assets | 100.00% | 120.00% | 130.00% | 56.00% |
| Long-term Assets | -6.00% | -18.00% | -20.00% | 43.50% |
| TOTAL ASSETS | 100.00% | 100.00% | 100.00% | 100.00% |
| Current Liabilities | 7.00% | 5.00% | 3.00% | 20.50% |
| Long-term Liabilities | 0.00% | 0.00% | 0.00% | 18.20% |
| Total Liabilities | 6.00% | 3.00% | 1.60% | 37.50% |
| NET WORTH | 95.00% | 82.00% | 105.00% | 35.00% |
| Percent of Sales | ||||
| Sales | 100.00% | 100.00% | 100.00% | 100.00% |
| Gross Margin | 74.00% | 78.00% | 82.00% | 0.00% |
| Selling, General & Administrative Expenses | 65.00% | 80.00% | 65.00% | 55.00% |
| Advertising Expenses | 4.00% | 3.00% | 2.50% | 4.20% |
| Profit Before Interest and Taxes | 25.00% | 28.00% | 31.00% | 2.50% |
| Main Ratios | ||||
| Current | 13 | 16 | 19 | 1.8 |
| Quick | 26 | 29 | 32 | 2.5 |
| Total Debt to Total Assets | 5.05% | 3.00% | 1.80% | 65.00% |
| Pre-tax Return on Net Worth | 70.00% | 80.00% | 90.00% | 3.00% |
| Pre-tax Return on Assets | 65.00% | 60.00% | 70.00% | 10.00% |
| Additional Ratios | Year 1 | Year 2 | Year 3 | |
| Net Profit Margin | 18.00% | 22.00% | 24.00% | N.A. |
| Return on Equity | 55.00% | 60.00% | 65.00% | N.A. |
| Activity Ratios | ||||
| Accounts Receivable Turnover | 6 | 8 | 10 | N.A. |
| Collection Days | 95 | 105 | 110 | N.A. |
| Inventory Turnover | 17 | 21 | 25 | N.A. |
| Accounts Payable Turnover | 12 | 15.2 | 18 | N.A. |
| Payment Days | 25 | 25 | 25 | N.A. |
| Total Asset Turnover | 2.8 | 2.6 | 2.4 | N.A. |
| Debt Ratios | ||||
| Debt to Net Worth | 0 | -0.07 | -0.04 | N.A. |
| Current Liab. to Liab. | 0 | 0 | 0 | N.A. |
| Liquidity Ratios | ||||
| Net Working Capital | $300,000 | $330,000 | $360,000 | N.A. |
| Interest Coverage | 0 | 0 | 0 | N.A. |
| Additional Ratios | ||||
| Assets to Sales | 1.45 | 1.48 | 0.35 | N.A. |
| Current Debt/Total Assets | 8% | 5% | 3% | N.A. |
| Acid Test | 26 | 29 | 33 | N.A. |
| Sales/Net Worth | 3.4 | 2.2 | 1.2 | N.A. |
| Dividend Payout | 0 | 0 | 0 | N.A. |
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