Developing an Organic Beauty Product Business Plan in Australia

This report presents a comprehensive business plan for organic beauty products in the Australian market, emphasizing the increasing demand for natural and eco-friendly cosmetics. The report begins by justifying the value of the business opportunity, highlighting the consumer shift towards health-conscious choices and the potential for profitability. It then delves into an external environment analysis, utilizing PESTLE and Porter's Five Forces to assess political, economic, social, technological, legal, and environmental factors, as well as competitive dynamics. A SWOT analysis is conducted to evaluate the internal strengths and weaknesses and external opportunities and threats. The report further considers key functional elements of the business, including production, marketing, and financial strategies, to ensure the successful launch and operation of the organic beauty product line.

Enterprise, Innovation and
Creativity

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Justification of the value of the opportunity being developed.....................................................3
External environment analysis for organic beauty products........................................................4
Analysis of limiting and enabling factors in relation to the exploitation of the opportunity.......7
Consideration of the major functional elements of the business.................................................8
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Enterprise can be termed as economic organization that works for the purpose of earning
profits. Innovation is defined as the process of changing or transforming the process of selling or
manufacturing anything. Creativity is doing something in a way which different and creative its
own. The report will be based on a product and development of a business plan on the innovative
product. The innovative product taken for this report is organic beauty products which are now
getting very much attention from the population of Australia.
The report will consist of the justification of the value of the opportunity for developing
the innovative product of organic beauty products. The reason behind opting for this product and
the benefits which it can make to the society will also be highlighted. External environment plays
a major role in any organization and it can understand with the help of PESTLE analysis and
Porter's five force analysis. SWOT analysis will allow to analyze the exploitation of opportunity.
Further, the report will highlight the production, marketing and financial strategy plan for the
product (Ahmad and et.al., 2018).
MAIN BODY
Justification of the value of the opportunity being developed
Nowadays need for beauty products is being increasing and people specially the younger
age group is becoming so dedicated to use beauty products which are not harmful for their skin.
Organic beauty products are the products that are manufactured by using organic ingredients or
the ingredients usually derived by plants. This is the reason that they do not cause harm to the
skin. Many firms in Australia are shifting from producing artificial beauty products to production
of organic beauty products. With the advent of new products in the market it becomes difficult
for the consumers to get knowledge about the organic products.
People of Australia are becoming health conscious which increases the need to produce
products which are not harmful for the skin. This brings need for the firms to satisfy the needs of
the consumers. Every firm in the country tries to operate in a way it can fulfil the preferences of
the customers and earn maximum profits. Organic beauty products can provide the firm the
opportunity to increase their sales and therefore increase their overall profitability. However, it is
not easy for the business to produce and sell the products in the market. It requires a business
plan which need to be properly processed. The management has to take care of the costs to be

incurred during production or selling products and after sales circumstances like customer
feedbacks. A proper business plan can make the beauty products be available to every person
who tends to use it. The reason why these products are considered good for the skin is the fact
that they do not cause allergies and are eco-friendly products which attracts the customers in the
long run.
External environment analysis for organic beauty products
External environment can be discussed with the help of pestle analysis. It is important to know
that external environment plays a major role before producing and selling any product. Most
importantly the organic beauty products is related to the health of the customers therefore it
becomes essential for the firm to produce eco-friendly organic products (Ferreras-Garcia and
et.al., 2019).
PESTLE analysis
Political factors – Political factors such as political instability plays a major role in the influence
of the production of organic beauty products. Trade relations of Australia with other countries
can affect the sales of the product. This is because it becomes difficult to acquire raw material
such as organic plant based products from other countries which delays the production process.
Sometimes it becomes difficult to sell the products in some other countries because of disputes
between the countries. Therefore, political stability of the operating country is very important for
success of the product (Ferro and et.al., 2020).
Economic factors – Economic factors includes the taxation, inflation rates, interest rates and
currency exchange rates of the operating country. It is important to determine the impact of
covid-19 on the sales of the beauty products. The raw materials needed from other countries
might be costly and can be charged with high import duties which can increase the overall cost
of production. Inflation in the country of Australia makes population reduces buying products
and this can result in dropping of prices and ultimately lowering the profits. However, with
increase in the gross domestic product of the country the disposable income for the customers
increases which increases the demand for organic beauty products. This increase the sales and
overall profitability for the product (Bouncken and et.al., 2021).
Social factors – The sales of the organic beauty products depends upon the taste and preference
of the customers and the type of lifestyle prevailing among the population of Australia. Social
factors includes different demographic factors like age, gender or income of the consumers. The

age of the consumers plays a major role in selling the beauty products. Younger age group is
concerned more with their skin to make it healthy and avoid the artificial products. Similarly,
older age group population prefer products which are organic as well as anti-ageing which
reduces their wrinkles. This increases their profits by producing products as per the preferences
of the customers.
Technological factors – Advancement in the technology has made it easier for the firms to
produce the products effectively and efficiently. This reduces the costs of production and also the
time required to produce certain items. Advancements in the research and development has
made it easier to know about the ingredients required to produce eco-friendly products.
Moreover, technological advances like social media has created buzz among the customers that
urge them to buy organic beauty products that does not cause harm to their skin. Unique selling
and marketing techniques allows the company to sell their products and increase the overall
profitability. Further, it will make it easy for the firm to sell the product in other operating
countries.
Legal factors – Legal factors consist of laws, rules and regulations that the business need to take
care while doing its day to day business operations. Laws such as intellectual property laws,
health and safety laws and different employee protection laws are prevailing in Australia which
is necessary for the firms to abide to. These laws keep a watch on the pricing of the product,
quality and the values generated by it. Exploitation of these laws can get the firm engaged in
business in serious trouble which makes it important for them to follow these rules and laws.
Environmental factors – Some major environmental factors that are needed to be taken care of
are waste management and recycling techniques took up by the firms in order to maintain clean
environment. The population of Australia is becoming conscious about the environment and this
makes it essential to protect the environment. The raw materials used for making the organic
products are usually plant based products which should be derived in a way that is harmful to the
nature and environment. At the time of selling the products, it should be sold in cloth bags and
usage of plastic should be avoided as it cannot be recycled (Glaveanu and et.al. 2020).
Porter's Five Forces
Threat of new entry – This is the factor that tells about the ease in which new firms can enter the
industry. Being a competitive industry many new firms gets attracted and tends to take a high
share in the market. This can reduce the profitability of the firms that are already operating in the

industry. For the firms which are engaged in producing and selling the organic beauty products,
it is quite a threat because it reduces its overall profitability. It makes it important for the firm to
create a brand image and make their customers loyal about their products. With the help of this
the firm can earn enough profits even there are new entries in the industry as the customers are
loyal to their products (Figueroa-Robles and et.al., 2021).
Bargaining power of customers – Bargaining power can be considered as the power in the hands
of the customers to change the prices. These prices can be changed as per the basis of the
demand prevailing in the market. Change in demand brings about change in the bargaining
power of the customers. In case the customers have high bargaining power , the sellers cannot
predict anything about the future demand in the market. This results in lower profitability for the
manufacturers because of unpredictable patterns of the future. Customers can opt for the
substitutes of the products and ask for prices that are suitable for them. This the most major
threat that every business engaged in producing organic beauty products has to face (Matovic,
2020).
Bargaining power of suppliers – This is the power which remain in the hands of the suppliers,
and they have the right to charge the price they want for their product. Sometimes, suppliers who
have high bargaining power often use different methods like hoarding and regulating supplies.
However, the industry of organic beauty products in Australia is full of competition which does
give the power to the suppliers to charge higher prices which ultimately lowers their bargaining
power (Han and et.al., 2020).
Threat of substitutes – With increase in the demand for the organic beauty products as more and
more people becoming health conscious, there is more competition in the market. Many firms are
engaged in manufacturing and selling organic beauty products which creates high level of threat
of substitutes. Specially, the younger generation is more conscious about their health and indulge
in usage of these products. Rival brands offer lower prices for their products and offer regular
discounts which attracts the customers and ultimately they shift to other brands. It is important
for the firms to retain the customer loyalty as threat for substitutes increases.
Barrier to entry and exit – This can be considered as the challenge that the new firms faces while
entering the industry and the firms that are planning to exit the industry. As the entry requires
huge amount of costs like operation cost, cost of development etc., it can be said that there are
some barriers to entry. As the operational costs are higher it becomes difficult for the firms to

exit the industry without covering their overall costs. Therefore, it can be said that there are some
barriers to exit (Nguyen and et.al., 2019).
Analysis of limiting and enabling factors in relation to the exploitation of the opportunity
The analysis can be done by using swot analysis which tells about the different opportunities
available to the firm that is producing and selling organic beauty products. It is important to
know that with increase in the competition firms need to take care of the threats associated with
the business. Also, there should be enough knowledge about its weaknesses and strengths to
maintain a good position in the market. Here is the SWOT analysis for firm in Australia engaged
in production and sales of organic beauty products.
Strengths – The major strength of the firm can be achieving huge market share. If the firm
attains a very good market share then it is possible that it maintain a good and reputed position
among the minds of the customers. It should operate its business in other countries also and try to
cater to the needs of different segments of customers. It should make use of its strength by
providing innovative products in different categories and should try to improve its quality.
Moreover, the shops and the ambience of the stores should be good so that more and more
customers gets attracted which can act as a strength for the business (Ortiz-Villajos and et.al.,
2018).
Weaknesses – Weaknesses can be termed as the drawbacks which the business can face in order
to sell its organic beauty products. Less promotion and advertising of its products can be a major
weakness. The shopkeepers and the sellers should have the proper power in their hands in order
to achieve success. Another weakness is the fact that the shops should not be overcrowded which
makes the customers shift to another place as more crowded place is time consuming for the
customers. Unstable supply for raw materials can take long time to produce the products.
Opportunities - Awareness among the consumers to use organic beauty products that does not
harm the skin of the people act as the opportunity for the business. Social media has created an
opportunity as the firm can use its website to provide knowledge about the products. Increase in
sales for particular products like younger generation opt for new and innovative products can
ultimately result in higher profitability for the business. Focusing on particular group can make
increase the sales and thereby increase the profits. Markets which offer high profits should be
focused in order to maintain a good competitive edge in the society.

Threats – In the industry of cosmetics, there is immense competition and new firms are
continuously producing and selling organic beauty products. This is because more customers are
becoming health conscious and are purchasing products that do not harm their skin. This type of
competition can be a threat to the firm. Usage of unethical business practices can make the
customers shift to other big brands as they think that the business is harming the environment.
The purchasing power in the hands of the customers has decreased which will make it difficult
for the firm to increase its sales. Moreover, the raw materials used is imported from different
countries and laws and regulation on imports can make it difficult for the firm to acquire the raw
materials (Rafiei and et.al., 2020).
Consideration of the major functional elements of the business
Major elements of business includes the strategies or plans including the production plan,
marketing plan and the financial plan. These are the strategies which business makes in order to
increase the sales for its products and increase the overall profitability. Following are the major
plans for the firm engaged in the production of organic beauty products.
Production plan
Estimate Demand – The firm should first estimate the demand for the product in the market and
then start the production process. It is very crucial to know about their demand as excess number
of stock can be termed as a wastage.
Access Inventory – It is important that the inventory is regularly checked and properly estimated.
Proper techniques should be adopted to handle the inventory effectively. This can help the firm
to get an idea about the excess or shortage in the stock.
Resource Planning – the resources which are required to be engaged in the production of the
products should be optimally used and properly checked. Any mistake in any of the resource can
ruin the process and overall effectiveness of the process.
Monitor Production – While the process is going on, it is important to continuously monitor to
check if any deviation occurs while the running of the process. Regular evaluation of the
products can make the process successful.
Adjust the plan – in order to overcome the deviation the production plan can be adjusted as it is
not only about producing goods but it is concerned with production of quality products. Further,
techniques can be adopted to run the production process more smoothly.
Marketing Plan

Mission – In this step the mission of the plan should be depicted which should include that the
plan is made for promoting the organic beauty products among the customers. This will help the
management to focus on a particular goal (Shao and et.al., 2020).
Set KPIs – Key performance indicators can help the business to know about the success of the
business and value proposition of the business. It can track the websites to know the
demographic segment, the business is catering.
Identify target market – It is important that the business should have a knowledge about the
market It is targeting in order to produce what is preferred by the consumers. Organic beauty
products are generally proffered by the younger generation and the firm should target this group.
Strategy – Marketing is not possible without proper techniques which makes it important for the
business to make policies and strategies that can allow it to take up the marketing activities.
Adjust the plan – Likewise the production plan, marketing plan can also require some king of
adjustments if any deviation are found during its process. If one the activity is performing better
than the firm can invest more on it as compared to others (Walia, 2019).
Financial plan
Financial goals – The goals should be prescribed in order to know the finances required for the
business. The business plans the finances to avoid any kind of wastage and make the business
efficient. Goals should be divided according to the period like short term or long term goals.
Net worth – The business should make a list of the net worth that consist of the assets and
liabilities of the business. The difference between the assets and liabilities will be considered the
net worth.
Budget planning – Proper budget should be planned so that allocation of resources can take
place. Budgets are maintained to know which resource requires how much cost can be
determined.
Debt management plan – A proper plan for managing the debt in the business should be
prepared. When the finance is raised by different sources like a bank loan, it is important to
know the interest rates and different criterion.
Emergency funds – The business should make arrangements for the sources in case there is
requirement of emergency funds for running the business effectively. These funds are prescribed
by the business so that the business can access it in emergency (Wang and et.al., 2020).

CONCLUSION
Business plan can be considered as the planning of the future objectives and setting of
goals. This includes different types of plans specially the financial and marketing plan which
allows the firm to get a knowledge about the policies and strategies that need to be implemented
in order to survive in the market. The report was based on a firm that is engaged in the
production and sales of organic beauty products. It has been concluded that it is important for the
business to know about its external environment. The report highlights the pestle analysis along
with porter's five force analysis. The opportunities and strengths of the business were identified
with the help of SWOT analysis. Moreover, production plan, marketing plan and financial plans
were also discussed in the report.

REFERENCES
Books and journals
Ahmad and et.al., 2018. Influence of perceived value and personal values on consumers
repurchase intention of natural beauty product. International Journal of Supply Chain
Management, 7(2), pp.116-125.
Bouncken and et.al., 2021. Knowledge-and innovation-based business models for future growth:
Digitalized business models and portfolio considerations. Review of Managerial
Science, 15(1), pp.1-14.
Ferreras-Garcia and et.al., 2019. Entrepreneurial competences in a higher education business
plan course. Education+ Training, 61(7/8), pp.850-869.
Ferro and et.al., 2020. Design thinking as an innovation strategy for business and marketing
plans. e-Revista LOGO, 9(2), pp.44-64.
Figueroa-Robles and et.al., 2021. Encapsulation of phenolic compounds with liposomal
improvement in the cosmetic industry. International Journal of Pharmaceutics, 593,
p.120125.
Glaveanu and et.al. 2020. Advancing creativity theory and research: A socio‐cultural
manifesto. The Journal of Creative Behavior, 54(3), pp.741-745.
Han and et.al., 2020. The marketing strategy to stimulate customer's interest in art-gallery
business plan. Journal of Distribution Science, 18(8), pp.47-54.
Matovic, I.M., 2020. PESTEL analysis of external environment as a success factor of startup
business. ConScienS, p.96.
Nguyen and et.al., 2019. Key determinants of repurchase intention toward organic
cosmetics. The Journal of Asian Finance, Economics and Business, 6(3), pp.205-214.
Ortiz-Villajos and et.al., 2018. Innovation and business survival: A long-term
approach. Research policy, 47(8), pp.1418-1436.
Rafiei and et.al., 2020. New frontiers, challenges, and opportunities in integration of design and
control for enterprise-wide sustainability. Computers & Chemical Engineering, 132,
p.106610.
Shao and et.al., 2020. Environmental regulation and enterprise innovation: a review. Business
Strategy and the Environment, 29(3), pp.1465-1478.

Walia, C., 2019. A dynamic definition of creativity. Creativity Research Journal, 31(3), pp.237-
247.
Wang and et.al., 2020. The ethical issues of animal testing in cosmetics industry. Humanities
and Social Sciences, 8(4), p.112.