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Nailing it? Duo looks to make their polish a beauty industry best-seller.

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WITH JUST $2,000 FROM THEIR PERSONAL SAVINGS, H. Ginger Johnson and Sara "Liz" Pickett have turned their love of gorgeous nails into a lucrative business. In January 2010, the duo officially launched Ginger + Liz Colour Collection Inc. (G+L), a nontoxic, vegan-friendly nail polish line that now boasts 38 colors with provocative names such as Boss Lady, Caution, Can You Keep a Secret?, and Chase Me.

High-profile positioning in monthly trunk shows at New York City's legendary Fifth Avenue retail boutique Henri Bendel, and product availability at various salons and boutiques (while at least 25 salons and spas offer manicure/pedicure only, 10 more offer the product for retail purchase) in major cities such as New York, Washington, D.C., Atlanta, and Los Angeles, helped thrust the company to revenues of $175,000 in its first year. They're especially proud of being the only non-Carol's Daughter product sold in the Carol's Daughter flagship store in Harlem. By working out of a home office, utilizing two student interns, manufacturing the product line in the U.S., and not drawing a salary (Pickett models and acts, while Johnson works a full-time job), they managed to slip into the black this past summer, becoming profitable sooner than they expected.

Their most priceless asset so far has been that celebrities such as Beyonce, Mary J. Blige, and Queen Latifah, among others, wear Ginger +Liz nail lacquer. (Both leveraged industry relationships to help get the line noticed). The visibility works best to drive customers to their website, www.gingerandliz.com, from where about 6 5% of their sales are derived. Johnson says, "That's pretty significant considering that nail polish is a product people want to see and experience in person."

The manicure mavens want to expand the product's national reach, especially on the West Coast. But being self-funded has its benefits and challenges. Johnson, 31, says advertising on a minimal budget in comparison to notable competitors leaves them at a disadvantage. But 27-year-old Pickett says they deal with it by "being wise with our ad dollars and always using a multiplatform approach that includes social media networks." Such strategic efforts to put out a quality product and gain respect within the industry led to inquiries and now interest from buyers at Whole Foods Market. Johnson and Pickett expect their product to be distributed within Whole Foods' body care department starting next month.

To go full force in 2011, the women say it will take $115,000 to $125,000 to execute G+L's next phase. "We've been approached by a number of potential investors, but most want to invest much more money," says Johnson. The businesswomen want to avoid taking on unnecessary debt. "So far, we've been using a very financially efficient business model," says Pickett. And while they want to keep it that way, they do see G+L's opportunities and possibilities as limitless. "We know we need to grow, but in order to get there, we need money," says Johnson. "And we're open to having as many conversations as we need to in order to make it happen."

GINGER + LIZ COLOUR COLLECTION

Co-Owners: H. Ginger Johnson, Sara "Liz" Pickett

Location: New York

Product: Nail Lacquer Line

Launch: January 2010

2010 Revenues: $175,000

2011 Projections: $300,000

Now: A cult following, celebrity use of the polish, and product mentions in the pages of Harper's Bazaar, Marie Claire, and Teen Vogue give the eco-friendly line prime positioning.

Next: Starting this spring, plans to introduce a hand/nail scrub, cuticle cream, and polish thinner as well as build out a bigger West Coast presence. They need $125,000 to pull it off flawlessly.

41% of women change their nail polish at least once a week.

$463 million: U.S, sales of nail polish

The beauty industry is a $6 billion industry

RELATED ARTICLE: A polished approach.

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Ginger + Liz Colour Collection Inc. aims for a flawless path to success. Donna Ennis, Project Director for the Georgia Minority Business Enterprise Center at the Georgia institute of Technology, weighs in on Johnson and Pickett's efforts thus far and offers advice to the duo on their next steps in polishing up their business.

"They shouldn't be estimating what [the amount] should be," says Ennis, "They should have their pro forma financial statements done for years one, two, three, four, and five."

Johnson and Pickett need to know exactly what they are going to do; how much it's going to cost them; and how much they plan to make. Ennis says being privy to such information allows them to state unequivocally what the company requires and what the return on investment will be. "'We need $110,000 and in the first year of taking $110,000 we can do $500,000 [in sales],"' Ennis offers as an illustration.

In noting the importance of crafting an adaptable business plan, Ennis urges the duo to run through their projections and numbers again, because the figure concerns her a bit. "It [$100,000] just seems like such a small amount of money considering all they want to do, as well as continue to build the nail polish business," she says. At least one of them will have to give up her day job to look as attractive and committed as possible. "Nobody is going to fund them when they're still working full time," notes Ennis.

Ennis points out that the amount of investment capital they need would come from an angel investor, not a venture capitalist. She also suggests that the two women consider these questions: Are they really ready to take equity capital? Could they take a Small Business Administration loan? Her recommendation to those small businesses that can afford to do so is to take debt financing initially, "unless you have a launch that's so large," she adds.

In addressing their reluctance to receive capital and possibly lose control, "They wouldn't want to give away the farm," says Ennis. "But they could have a relationship and structure the deal in such a way that their company would most benefit."--J.O.
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Title Annotation:THE STARTUP; Ginger + Liz Colour Collection Inc.
Author:Ogunsola, Jennifer
Publication:Black Enterprise
Article Type:Company overview
Geographic Code:1USA
Date:Feb 1, 2011
Words:1015
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