Women and minority business owners are critical catalysts for economic growth; however, they are still confronted with barriers to funding. Nevertheless, the amount of women and minority-owned enterprises is steadily expanding. As such, if you are a black businesswoman seeking to make your goal a reality, you might be unsure of where to begin.
Nonetheless, continue reading to learn all you need to know about starting a minority-owned business, which includes how to become certified as a Minority woman-owned enterprise.
Steps on How to Start a Minority Woman Owned Business
-
Conduct Market Research
Understanding how to establish a company is usually a daunting task for everybody. Nevertheless, when you’ve decided on a business concept, the next step is to conduct market research. Collecting and evaluating data regarding the niche you want to gain entry into is what market research entails.
This is an important part of business planning because it can assist you in determining prospective consumers and ascertaining if your business will be successful.
a. Who is your Target Audience?
This will be determined by the type of business you want to establish as a minority female business owner. However, as previously stated, before you begin your business, conduct extensive research to learn about your clients, the scale of your supply chain, and any future competition.
b. Is Minority Woman-Owned Business a Profitable Business?
Yes. According to detailed reports, minority women-owned businesses achieve the most money in wholesale trade, retail trade, and professional, scientific, and technological services. Although the last few years have been difficult for women in business, take into account that the future is female, and pre-pandemic statistics suggest that women-owned businesses might be larger than we assume.
c. Are There Existing Niches in the Industry?
Small- and medium-sized enterprises spring up every day, and a substantial chunk of such new ventures are launched by women. Choosing a topic that interests you and taking into account the skills and knowledge you now have can be beneficial.
Individual service providers, animal care, educational services, marketing, and freelance work, technology services, travel services, and other enterprises are all options.
d. Who are the Major Competitors?
This will undoubtedly be determined by your industry and niche.
e. Are There County or State Regulations or Zoning Laws for Minority Woman Owned Business?
The tax rates, zoning ordinances, and restrictions that apply to your enterprise are determined by its location. You must make a deliberate judgment regarding which state, city, and neighborhood to establish your business in.
If you are looking to purchase, lease, construct, or function out of a physical location, make sure it meets local zoning demands. Zoning guidelines can limit or completely prohibit certain types of enterprises from functioning in a given area.
f. Is There a Franchise for Minority Woman Owned Business?
This will more or less be determined by your industry and niche.
g. What Do You Need to Start a Minority Woman Owned Business?
- A business idea
- A business plan
- Unique business name
- Legal structure for your business
- Business registration
- Necessary business licenses or permit
- Adequate funding
-
Choose a Memorable Business Name
When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.
Some of the catchy business name ideas suitable for a minority woman owned business business are;
Creative Minority Woman Owned Business Name ideas
- Feminine Touch
- Sun Flower Shop
- Candy Love Salon
- Pure Luxurious
- The Shiny Runners
- Blowing Black
- Orange Potion
- Care Zone
- Martha Shop
- Your Everyday Woman Shop
- Beauty Of Selah
- Blush Foundation
- Woman’s Love
- Pink Diamond
- Blue Lily Company
- Soft Gel Boutique
- Tirana’s Perfect
- Golden Brows
- Bunny Flair
- Bridesmaid Fusion
-
Register your Business
a. What Type of Business Structure is Best for Minority Woman Owned Business?
The type of business structure you select will determine how your company is structured and how you pay income tax. While each entity type has advantages and disadvantages, you should reconsider which choice is most suitable for your business.
If you plan to do business under a name besides your birth name, you must register a fictitious name with the county clerk’s office. Visit the websites of the relevant agencies to obtain the necessary registration details.
b. List Steps to Form an LLC
- Select a Name for Your LLC.
- Save the Articles of Organization.
- Choose a registered agent.
- Choose between member and manager management.
- Make an operating agreement for your LLC.
- Other tax and regulatory requirements must be met.
c. What Type of License is Needed to Open a Minority Woman Owned Business?
Based on your company’s location (including its entity type), you might be required to sign up with the state and apply for specific business permits and authorizations. Many businesses, including food service, childcare, and healthcare, may need precise licenses and authorizations. Nonetheless, here are some fundamental options to consider:
- Fictitious business statement
- Driver’s license
- Proof of U.S. citizenship
- Proof of ethnicity for the owner(s)
- Current financial statements
- Business licenses
- Employer Identification Number
d. What Type of Certification is Needed to Open a Minority Woman Owned Business?
After you’ve procured the necessary licenses and permits, you should think about obtaining a minority woman-owned business certification. Even though this certification isn’t necessary to build a company, it can be highly beneficial later on.
A minority-owned certification company can assist you in qualifying for certain government perks, like government contracts, and becoming a vendor to major businesses. Top certifications to consider include;
- NMSDC (National Minority Supplier Development Council)
- Women’s Business Enterprise National Council (WBENC) Certification
- National Women Business Owners Corporation
- SBA Women-Owned Small Business (WOSB) Program Certification
- Department of Transportation (DOT) Disadvantaged Business Certification Program
- Small Business Administration’s 8(a) Business Development Program
e. What Documents are Needed to Open a Minority Woman-Owned Business?
Also note that this will depend on your industry, niche, and location.
f. Do You Need a Trademark, Copyright, or Patent?
This will also be determined by your industry and the services you provide; however, if you need to protect your team’s logo as well as other distinguishable paperwork or software, along with jingles and media production concepts, you can file for intellectual property protection with the USPTO.
-
Do your Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Minority Woman-Owned Business?
This will also vary depending on the type of business you want to start, the size as well as scale of the business, the resources required, and the amount of capital you have available for the venture.
b. What are the Cost Involved?
- Setting up a business name and corporation: $150 – $200
- Business licenses and permits: $100 – $300
- Insurance: $100-$300
- Business cards and brochures: $200 – $300
- Wage bill: Varies
- Rent or lease of your physical location, if needed: Varies
- Website setup: $1,000 – $3,000
- Computer: $800 – $1,600
c. What Factors Determine the Cost of Opening a Minority Woman Owned Business?
- Business Type
- Permits and licenses
- Business structure and registration
- Renting, renovating, and furnishing a workspace.
- Software selection.
- Amount of Employees
- Marketing and advertising strategy
- Miscellaneous
d. Do You Need to Build a Facility?
You can run your business from home to save money, especially in the beginning. But as your business expands, you may need to hire workers and as well lease office space. Websites like Craigslist, Crexi, and Instant Offices can help you find commercial space for rent in your area.
e. What are the Ongoing Expenses for Running a Minority Woman Owned Business?
This will also vary depending on the type of business you want to start, its size and scale, and the amount of capital you have available for the venture. However, most of your expenses will be for the funds you’ll need to live on a daily basis, such as rent (if you have an office), car payments (for getting to and from client meetings), and so on.
f. What is the Average Salary of your Staff?
- Chief Executive Officer (Owner) – $74,460/ year
- Human Resources and Admin Manager:$66,870/ year
- Sales and Marketing Manager: $69,689/year
- Cashiers: $48,000/ year
- Customer Services Executive: $29,406/year
- Cleaners: $25,836 /year
g. How Do You Get Funding to Start a Minority Woman Owned Business?
- Startup Business Loans for Women
- Crowdfunding
- Self-funding
- Grants for Female Entrepreneurs
- Angel Investors
- Venture Capital
- Friends and Family
-
Write a Business Plan
a. Executive Summary
Black Beauty Store is an Austin-based minority-owned supplier of expert beauty products for black women. The above beauty supply store is a prime location for black women looking for cosmetics, fragrance, skincare, hair care, and beauty services.
We are ready to reinvent how neighborhood-based beauty supply stores should be operated, not just in our chosen location, but throughout the United States of America. This is also why, at periodic intervals, we will develop plans for training our storekeepers and other back office staff.
b. Products and Service
- Wigs and Extensions
- Hair care products
- Bath products
- Fragrances
- Make-up
- Skincare and lotion
- Tools and Brushes
c. Mission Statement
Our mission at Black Beauty Store is to build a well-known, impactful, and financially viable beauty supply store that will expand from a single store to chains of retail locations in the United States of America.
Vision Statement
Our vision at Black Beauty Store is to become the number one beauty supply store in Austin, as well as to continue growing to be among the most highly regarded top suppliers of beauty products for black women in Texas and the United States.
d. Goals and Objectives
At Black Beauty Stores, we will be selling beauty products, fragrances, hygiene products, personal grooming products, among other things. At Black Beauty Stores, we are dedicated to providing black women with one of the most desirable brands and products in the beauty industry.
e. Organizational Structure
- Chief Executive Officer (Owner)
- Store Manager
- Human Resources and Admin Manager
- Merchandise Manager
- Sales and Marketing Manager
- Accountants Cashiers
- Customer Services Executive
- Cleaners
Marketing Plan
a. SWOT Analysis
Strength
Our company resilience stems from our location, our profit model of “selling franchise and offering chains of retail locations,” a variety of methods of payment, a wide range of beauty supplies from well-known producers in the United States of America and other nations, and our outstanding client service culture.
Weakness
We recognize that operating a new beauty supply store in Austin will be a limitation for us, especially in our first year of operation. Furthermore, we lack the monetary resources to contend with multimillion-dollar skincare products, beauty, and fragrance retail outlets in the United States, particularly when it comes to selling cosmetics at rock-bottom prices.
Opportunities
Because our first shop will be situated on one of Austin’s major roads, we think it will provide our store with limitless potential to advertise and sell beauty products to a greater number of people.
Furthermore, as a result of the comprehensive feasibility studies and market surveys conducted by Black Beauty Stores, we understand what our prospective customers will be searching for when they contact our beauty stores, and we are fully prepared to capitalize on all chances that will arise.
Threats
We assume that the most significant threat we will face is an economic slump. To be honest, economic crisis has an effect on clients’ spending power. Furthermore, the emergence of a different beauty supply store or maybe even a convenience store that sells beauty products in our location will also be perceived as a threat to our progress.
b. How Do Minority Woman Owned Businesses Make Money?
These businesses, like any other, introduce new goods or services which may lead to major increases in efficiency, cost savings, and a better quality of life. They can also impose a higher price for their developments because they understand their services very well and are conscious of their clients needs. This can result in substantial rewards.
c. Payment Options
- Payment via bank transfer
- Payment with cash
- Payment via credit cards/Point of Sale Machines (POS Machines)
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
- Payment via bank draft
d. Sales & Advertising Strategies
- Collaborate with Local Organizations to Drive Traffic to Your Business Website
- Offer Promotions and Discounts
- Utilize Innovative Packaging for Your Products
- Marketing via Direct Mail
- Make a community to increase brand advocacy
- Include testimonials on your product pages
- Effective content marketing
- Utilize Micro-influencers
- Social listening can help you find customers
- Post Content That Will Interest Your Ideal Customer
- Use Facebook as a Primary Communication Channel
- Use Twitter as a source of information about your services.
- Offer Instagram Incentives Use Word-of-Mouth to Provide Group Deals
Financial Projection
a. How Much Should You Charge for your product/Service?
Although this will vary depending on the services and products you provide, your pricing should remain reasonable so that clients will feel like they are getting a good deal when they patronize your business.
b. How Much Profit Do Minority Woman Owned Business Owners Make a Year?
As per a 2019 American Express report, Black female founders make an average of $24,000 per enterprise. This compares to less than 17% of the total revenue generated by women-owned businesses. According to the report, the median income for all women-owned enterprises is $142,900.
c. What Factors Determine the Amount of Profit to Be Made?
- Business Type
- Business Size
- Marketing and Customer Retention Strategies
- Investment
- Pricing Model
d. What is the Profit Margin of a Minority Woman Owned Business Product/Service?
A good margin will vary greatly depending on the industry and size of the business, but a 10% net profit margin is regarded as economically sustainable.
e. What is the Sales Forecast?
This will undoubtedly be determined by your industry and business location. Nonetheless, keep in mind that minority and women-owned small businesses are having difficulties even as the United States economy demonstrates a positive trend, but the future appears bright and profitable for minority women-owned businesses.
-
Set Up your Shop/Office
a. How Do You Choose a Perfect Location for Minority Woman Owned Business
Take into account these recommendations when choosing a commercial space:
- The location is central and easily accessible by mass transit.
- Pleasant and well-ventilated, and have plenty of natural light.
- Lease that is flexible and can be extended as your business grows.
- Ready-to-use space that does not require any major renovations or repairs.
b. What State and City are Best to Open a Minority Woman Owned Business?
- San Antonio, Texas
- Orlando, Florida.
- Baltimore, Maryland.
- San Jose, California.
- Washington, D.C.
- Seattle, Washington.
- Houston, Texas.
- Dallas-Fort Worth, Texas.
c. What Equipment is Needed to Operate?
Although this will also vary, note that the basic equipment you need includes;
- Computers and Smartphones.
- Internet and Communications.
- Printer and Shredder.
- Security Systems.
- Company Vehicle.
- Shipping Tools.
- Specialty Equipment.
- All-in-One Software.
-
Hire Employees
Before you can attract the appropriate staff, you must first devise a compensation strategy. To establish payroll, here’s what to do:
- Obtain an Employer Identification Number (EIN).
- Determine whether you require a state or local tax identification number.
- Choose whether to hire an independent contractor or an employee.
- Ensure that new hires return a completed W-4 form.
- Plan pay periods to align IRS tax withholding.
- Make a holiday, vacation, and leave compensation plan.
- Payroll administration can be handled in-house or by an outside service.
- Determine who will be in charge of your payroll system.
- Determine which records should be kept on file and for how long.
- Payroll taxes must be reported quarterly and annually.
-
Launch the Business Proper
Once you’ve acquired the required equipment, hired workers, and started looking for customers, take into consideration that there is still one essential part left in the unveiling of your business: finding and attempting to belong to the appropriate association.
Keep in mind that joining an association can be a very valuable asset for a new minority business owner, especially since it directly connects you with other decision-makers in the relevant industry while also providing a wide range of other benefits.
a. What Makes a Minority Woman Owned Business Successful?
- Comprehensive preparation.
- Work is required.
- Marketing efforts should be targeted.
- Appropriate attention to details and client needs.
- Conduct ongoing research.
- Network, network, and network.
- Connect With Other Female Entrepreneurs
- Access to Capital
- Join an Entrepreneur Network
- Build a Strong Team
b. What Happens During a Typical Day at a Minority Woman-Owned Business?
To be honest, this will differ from one business to the next. Even though some entrepreneurs recruit staff to assist with specific facets of running their company, they are still engaged in the majority of the everyday schedule, from advertising and marketing to dealing with clients to data processing and budgeting.
A typical day for an entrepreneur would include responding to emails and texts, returning phone calls, ordering supplies, addressing client queries, inputting, or concerns, and keeping meticulous business records. Entrepreneurs also will market their company through advertisements, keep a favorable presence online, and network at community gatherings.
c. What Skills and Experience Do You Need to Build a Minority Woman Owned Business?
- Financial administration
- Marketing, sales, and customer service
- Negotiation and communication
- Project administration and planning
- Time management and delegation
- Solving problems