I Spent 3x More Money Than I Budgeted to Launch My Business

We know how daunting it can be to start a new business, especially if you’re disrupting an industry or creating an entirely new one. When there is no path to follow, the biggest question is, where do I start? There is so much to do, but before you get ahead of yourself, let’s start at the beginning. To kick-start the process, and ease some of those first-time founder nerves, we’re asking successful entrepreneurs to share their stories in our new series, From Scratch. But this isn’t your typical day in the life profile. We’re getting into the nitty-gritty details—from writing a business plan (or not) to sourcing manufacturers and how much they pay themselves—we’re not holding back.

Photo: Courtesy of Brittney Ogike

Brittney Ogike knew starting a business would be expensive, but she underestimated just how costly it would really be. “When I wrote my business plan, I didn’t allocate enough dollars to certain areas like buildout and inventory,” Ogike tells Create & Cultivate. “I remember telling our design firm my original budget for the buildout. They pretty much laughed at me and suggested I not work with a firm and go it alone. I had no idea about the amount of money it would take to build the store I was envisioning!”

Thankfully, these expenses didn’t discourage her from bringing her vision to life. As the founder of BeautyBeez, a modern beauty supply store created by and for WOC, she’s bringing an elevated and inclusive shopping experience to women who have been long overlooked by the beauty industry. “For decades, the beauty supply has been left unchanged and wholly inadequate,” Ogike explains. “And more recently, consumer behavior has shifted. Our community has become more conscious of where we spend our hard-earned dollars, but with no place to turn to for our complete beauty needs.”

Ahead, Ogike tells Create & Cultivate all about her business and her founder journey, including the lightbulb moment that inspired her to launch BeautyBeez and the costly lessons she’s learned since becoming an entrepreneur.

Take us back to the beginning—what was the lightbulb moment for your business? 

BeautyBeez was created to fill a gap in the retail industry. What many people outside of the African American community don’t realize, is that ethnic hair care and beauty products are typically sold in small local retailers called beauty supply stores. Every Black woman has memories—both fond and unpleasant—of going to the local beauty supply store with our mothers and shopping for those nostalgic “Black girl hair” products: hot combs, barrettes, relaxers, hair grease, and a whole lot more. It was a space specifically for us! The larger retailers didn’t (and still don’t) carry these items. 

The lightbulb moment occurred when I was shopping for some hair products for my daughter. I was forced to go to our local beauty supply store and left feeling upset about the entire experience. For decades, the beauty supply has been left unchanged and wholly inadequate. And more recently, consumer behavior has shifted. Our community has become more conscious of where we spend our hard-earned dollars, but with no place to turn to for our complete beauty needs. BeautyBeez was created to fill the white space in ethnic beauty. We provide an inclusive beauty experience where women of color can shop, explore and play in a world full of beauty. 

Did you write a business plan? If so, was it helpful, and if not, what did you use instead and why did you take that approach? 

Yes! A business plan was essential in building the framework of BeautyBeez. It helped me establish the mission of the brand, the product offerings, and financials. I also believe it was useful in persuading my family members to join. I still refer to it to this day. 

How did you come up with the name BeautyBeez? What was the process like and what are some of the things you considered during that process? 

When determining the business name, I wanted it to have a few characteristics—unique, brandable, identifiable, and include a personal nod to my family. I wanted a complete departure from the typical beauty supply name with the hopes of establishing the brand as a leading beauty retailer—and not just a beauty supply. The “Beez” in BeautyBeez has a few different symbolic meanings. It acknowledges me (B for Brittney), my daughter (Z for Zara), and the fierce, matriarchal symbolism of the bee animal. 

What were the immediate things you had to take care of to set up the business? What would you recommend to new founders reading this who don’t know where to start? 

The first thing I did was establish the business name. I contacted a lawyer and had them register and trademark the name. Next, I bought the website domain and created social handles on all social platforms, even though I didn’t need them immediately. 

What research did you do for the brand beforehand, and can you explain how you found and compiled that research? Why would you recommend it and why is it important? 

I visited as many beauty supply stores as possible and posed as a customer to figure out how I could fill the white space. I read online reviews to understand the pain points. I spoke with all of my friends about their experiences shopping for their beauty needs and had conversations about how the issues could be resolved. Lastly, I researched the history of the industry. Why was it dominated by a specific group of people? Who are the major competitors? What are the potential barriers to entry? To gather information, I read trade articles, searched the web, and went down every rabbit hole I could find on the topic. It’s important that you’re educated in whatever industry you get into. Stay on top of trends and the laws and regulations that are passed down. 

How did you find and identify the distributors you work with? What are some of the challenges you faced along the way and what advice can you share for fellow small business owners? 

Since I’m a minority in the industry, I faced several challenges trying to open accounts with distributors. I have been charged high minimums, required cash upfront when others are given credit terms and have been flat out denied access. Oftentimes, working directly with the brand was a lot easier to procure products. The advice I would give is to not give up. Reach out to as many different manufacturers and distributors as possible. All you need is one “yes.” And once you get that “yes,” thoroughly research them. Find people in your industry that have done business with them. This will not only help you vet the supplier, but it will also help you in establishing a network of contacts in your new industry. 

How have you funded your businesss?

We are a family-owned company comprised of myself, my husband, and my brother. Fortunately, we are self-funded and haven’t had to seek any outside funding, yet. 

What is the biggest money mistake you made in the beginning and how did you recover from it? 

I’ve spent way too much on inventory. I was so eager to start ordering products for the store that I didn’t fully understand the ordering process with some distributors. They all have different rules and ways of ordering. I should have been more conservative on quantities and asked more questions. I’m currently sitting on hundreds of sewing kits if anyone needs any! 

Did you work full-time at another job while building this one or just dive straight into it? Can you share your experience and what you would recommend to others? 

Yes. I’m moonlighting as a sports manager. My career has always been in sports and I don’t see myself giving up on that work any time soon. I enjoy what I do in both industries—beauty and sports! 

Do you pay yourself? If so, how did you know how much to pay yourself? 

I haven’t paid myself, yet. Once we reach profitability, I’ll be able to start paying myself a minimal salary.

How big is your team now, and what has the hiring process been like? Did you have hiring experience before this venture? If not, how did you learn and what have you learned about it along the way? What advice can you share? 

I have a staff of four part-time employees that work in the store and three corporate team members that assist with operations and branding. Finding great team members is one of the toughest parts of being a business owner. I’m still learning along the way, but the best advice I would give is to hire slow and fire fast. It’s important to take the time to find the right person for the position. Call references, run background checks and do all the things necessary to make sure the candidate is the right fit. If that person isn’t working out, it’s also important to remove them from the position immediately. You can’t let your emotions get in the way, which is a lesson I had to learn. At the end of the day, it’s about your company and what’s best for the business. 

Did you hire an accountant? Who helped you with the financial decisions and setup? 

Yes, I hired an accountant to assist with bookkeeping and monthly financial reports. Admittingly, financials are my weakest skill set. I even audited a college finance class the summer before I started working on BeautyBeez because I know how important it is to understand financial statements and reports. 

Can you share the biggest learning curve or challenge since starting your business and why? 

My biggest learning curve has been the economics of it all. This includes budgeting, forecasting, profit/loss, etc. There are so many financial decisions that need to be made on a daily basis when running a business. Having a comprehensive knowledge of your company’s financial standing is essential for success. I’m constantly educating myself on how to have better margins, determine pricing, and control costs. 

Do you have a business coach or mentor? If so, how has this person helped, would you recommend one, and how did you find one? 

I’m currently in the process of trying to find a mentor or an executive network group to join. Having a mentor or joining an executive group can help you grow as a leader and aids in better decision-making in your business. I would love to have a group of like-minded entrepreneurs to bounce ideas off of or troubleshoot certain issues I’m facing. 

How did you promote your company? How did you get people to know who you are and create buzz? What percentage of your budget goes to marketing and why? What challenges have you faced? 

First, let me say this. If you build it, they will not come! You have to build it, then tell people about it. Marketing was a huge challenge for me in the beginning. I think it was because I was trying to figure out which strategy worked that would give us the best return. We’ve done flyers, banners, a referral program, digital ads, and social media. Social media is where we’ve seen the biggest response. We had to figure out where our ideal customers were. They’re on social! So, we’ve invested a lot of time, dollars, and energy to make sure BeautyBeez is in front of them on all of the social media channels. Presently, we’re spending about 30% of our budget on marketing. 

What is one thing you didn’t do in the setup process, that ended up being crucial to the business and would advise others to do ASAP? 

I severely underestimated my startup costs. I ended up spending three times more money than I previously budgeted to create BeautyBeez. When I wrote my business plan, I didn’t allocate enough dollars to certain areas like buildout and inventory. I remember telling our design firm my original budget for the buildout. They pretty much laughed at me and suggested I not work with a firm and go it alone. I had no idea about the amount of money it would take to build the store I was envisioning! The lesson in all of this is to do your research in determining potential costs and do not be conservative. 

For those who haven’t started a business (or are about to) what advice do you have? 

Just do it! You cannot wait for the perfect moment. I read some advice when I was in the early phase of developing BeautyBeez that said to complete at least one task a day that gets you closer to your goal. It can be as small as research on a particular topic or as big as creating a website or registering your business. I took this approach and a year later, we officially launched. There are going to be many challenges and hurdles along the way. Take them one day at a time. In the end, the gratification you feel once your business launches will be worth it. 

What is your number one piece of financial advice for any new business owner? 

Pay attention to the numbers. They don’t lie. We create businesses for a lot of reasons, but at the end of the day, we want them to make money. Profitability is the goal for most businesses, and to reach profitability, you need to look at your numbers. What is making the most revenue? How can you increase these sales? What isn’t working and costing too much money? These are the questions you should ask yourself every month and make adjustments. Ultimately, if there is no path to profitability, your business will fail. 

If you could go back to the beginning with the knowledge you have now, what advice would you give yourself and why? 

I would say slow down. I was so eager to get up and running that I didn’t fully understand many of the aspects that have now cost us a lot of money in mistakes. Yes, mistakes will happen. But, the goal is to not make expensive mistakes. The only way you can do this is to do your research and make informed decisions. 

Anything else you’d like to add?

For anyone out there looking for a sign to tell you to start, this is your sign. Start now! Follow your dreams and don’t let anyone or anything hold you back.

MORE ON THE BLOG