Marketing Plan for a Cosmetics Company
EXECUTIVE SUMMARY.
CosmoCosmetics.
1389 Sunshine Ave.
Fort Lauderdale , Fl 34587
CosmoCosmetics has decided to create a new foundation make up line for African American women exclusively. We believe there is a niche for this type of business since no make up brands specialise in this target.
CosmoCOsmetics would be the exclusive manufacturer that sells to cosmetic retailers.
Not only would emphasise on the variety of colours but also the packaging of the product.
1. The colours would be adjusted to this type of skin( a wide variety of darker colours )
2. The make up would be offered as a spray, a completely new format in the make up industry. A Compact size that doesn?t occupy any space in the hand bag, extremely easy to use and achieves the best natural and professional results any woman would dream of.
After studying the cosmetic market we can identify a series of needs in this market:
1. EASE OF USE
2. AVAILABILITY
3. PORTABILITY
4. VARIETY OF COLORS
5. DURABLE
Our Spray Foundation would meet these needs by offering:
1) Spray packaging with a diffuser.
2) Big cosmetic retailers across South Florida, near business areas and suburbs (Miami Downtown, North Miami Fort Lauderdale, West Palm Beach.
3) Compact size: 30 ml.(doesn?t occupy much space in the lady?s purse).
4) Variety of colours adjusted to their type of skin tone.
5) Long Durability: Just needs to be applied once a day, for long lasting results. The combination of powder + minerals will make the makeup last longer leaving a moisturized and natural look.
Market.
Household and personal care product companies are making efforts to stimulate sales in a variety of ways, such as entering new markets, creating new product categories, adding new distribution channels, and acquiring (and divesting) businesses to be able to compete in this highly competitive industry.
Over the last decade, sales at general merchandise stores, pharmacies and drugstores, have grown at average annual rates of 6.0% and 7.5%, respectively, according to US Census Bureau retail trade data.
The US and Western European markets are reaching saturation- therefore cosmetic companies see the future markets for their products in Central and Eastern Europe, Chi...
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...lenge for us.
Break-even (units)= ($116.400 + $32.000)/ $23= 6.453 units /quarter
Break-even sales ($)= 6.453*28.5= $183.911
Total Revenue from sales $183.911
Cost of goods sold $43.500
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Gross profit $140.411
Calculating the ratio of variable expenses to net sales
The percentage is $43.500/ $183.911 = 23.65%
Cosmo-cosmetics Co. uses $0.246 out of every sale dollar to cover variable expenses, leaving $0.753 as a contribution margin to cover fixed costs and make a profit. (Note: 75.3% is the contribution margin as a percentage of sales)
Break-even sales = $116.400/ 0.753 = $154.582
Thus, Cosmo-cosmetics will break even with sales of $154.582
Break-even Chart
We would expect a sales level of $183.911 (Point A= Income)
Income & Expenses
Sales Volume
The break-even point is located in the intersection between the total expense line and the revenue line. As it is shows, Cosmo-cosmetics operates at a sales Volume to the right of the break-even point (point A), this means that it would earn a profit because the revenue line lies above the expense line over this range ?Profit area?
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United Kingdom. Committee of Advertising Practice. Committee of Advertising Practice. Accessed November 18, 2013. http://www.cap.org.uk/Advice-Training-on-the-rules/Advice-Online-Database/Cosmetics-The-use-of-production-techniques.aspx.
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