If you wanna start a cosmetic business, the first question that comes to your mind might be:

“How much does it cost?”

To find out how much it costs to start a cosmetics business, you have to break it down into major expenses.

1. Incorporation Fees 
2. Brand Development Costs
3. Production Costs
4. Website Costs
5. Marketing Costs

Production costs are probably the largest expense among those, while it’s the hardest piece of information to obtain when new to the industry.

Many cosmetic manufacturers keep their production prices a big mystery, but we don’t!

One of the first steps in launching a cosmetics business is choosing a business entity type.

This decision impacts your taxes, legal liabilities, and financial management.

If you decide to incorporate or form a limited liability company (LLC), you will need to file articles of incorporation or organization with your state.

The filing fees vary widely from state to state, ranging from $50 to $725, though most states charge less than $300.

Incorporation fees vary significantly by country. While the average cost is similar to that in the USA, around $300, some countries, like Germany or the UK, allow you to start a business for as little as $1.

In our opinion, this is the most underrated cost factor when thinking about starting a cosmetic brand.

Especially in a market, where it’s all about beauty and aesthetics, investing in professional brand development rather than relying on DIY logo generators and similar tools is absolutely essential for several reasons.

A professionally crafted brand helps to establish a unique identity that distinguishes your cosmetic brand from its competitors. Your brand is the only way to stand out and build trust in a crowded market.

Professionals bring expertise in market research, consumer psychology, and design principles that are typically beyond the scope of basic logo creation tools.

This results in a cohesive brand identity that resonates more effectively with your target audience.

While upfront costs may be higher, the long-term benefits of a strong, professionally developed brand can significantly outweigh initial savings achieved through self-made, often generic branding elements.

Production costs is where you probably struggle the most to get a realistic estimate for your first order.

But don’t worry!

We, as a cosmetic manufacturer, can give you a pretty good ballpark for the production cost of different cosmetic products.

First, you have to choose the production method.

There are basically three options: Pre-manufactured products, pre-formulated products and a development of new products.

There are some private label cosmetic suppliers, like Blanka, where you’ll find on-stock cosmetic products starting from just 1 unit.

There’s basically no investment in production needed. They literally drop-ship products labelled with your logo.

Major downsides are the lack of customization and really high unit prices.

Then you have cosmetic manufacturers like us:

We offer pre-formulated but not pre-produced products. This is just another type of private label cosmetics.

There is a minimum order quantity of around 1000 units (depending on the product category), but the price per unit is much cheaper.

It also allows you to change and customize the packaging to make it truly unique.

Let’s assume that you want to start your cosmetics business with at least 3 different products. We assume an average cost of €5,000 per product. This means you should plan on €15,000 for a small cosmetics line.

The third option is to develop a custom formulation.

This takes a few months and costs about $500-$5000 extra (depending on the formula).

The minimum order quantity and unit price is similar to the second option.

Starting your own cosmetic business can indeed be profitable, whether it is a skin care or makeup line.

But the speed at which profitability is achieved can be somewhat uncertain. As a small-scale start-up, the likelihood of placing your products in major retailer, like Sephora or Ulta, or even mid-sized local stores is slim when you start out.

A practical approach is to launch online, which allows you to gather sales data and attract initial customers. This data proves invaluable when approaching local markets to persuade them to stock your products.

The broader the public’s awareness of your product, the greater your chances of success.

If you’re somewhat familiar with technology, we’d recommend setting up a Shopify store by yourself. It’s very straightforward, even with no coding experience.

You can basically build your own fully functional online store in just one day.

It costs around $36 a month.

Your marketing budget is a highly individual choice. We’ve seen anything working, from zero to hundred of thousands of dollars.

On the one hand, we have plenty of successful customers who basically started without any marketing budget at all.

Some have had plenty of followers on Instagram, others gone viral with one of their TikToks or were trending on Amazon without any marketing spent.

On the other hand, there are brands that invested hundred of thousands into building a strong brand and wouldn’t have been successful without it.

They invest in all kinds of brand building efforts and buy paid ads across different platforms like Google, Social Media and TV.

You should do everything possible to grow organically (post daily on all social media channels, do search engine optimization, try to trend on Amazon, and so on).

But at the same time, plan a realistic budget for marketing that increases the chances of your success — even if this is just a backup if organic alone does not work out for you.

As we’ve discussed, the costs for starting a cosmetic business varies on many factors, but here’s a simplified calculation:

1. Incorporation Fee: $300
2. Brand Development: $1,500
3. Production Cost: $15,000
4. Website Cost (1 Year): $480
5. Marketing Budget: $2,000

To finally answer the question:

In total, you should plan on a budget of around 20,000 dollars for starting a cosmetics business. This includes the start-up costs, brand development, production costs for up to 3 different cosmetic products, an online store and some marketing budget.