Handcrafted soaps are fun to make and getting more popular all the time, but breaking into the business can feel a little overwhelming. If you’re not sure where to begin, don’t worry! With a little patience and creativity, you’ll soon be on your way to selling your own sudsy handmade creations.
Here are 13 tips to help you get your homemade soap business off the ground.
[Edit]Steps
[Edit]Create a budget to understand your costs.
- Budget for things like equipment, packaging, and advertising. Before you start making soap to sell, make a list of everything you’ll need. In addition to the obvious stuff, like the raw materials, keep in mind the cost of things like liability insurance or fees for setting up a craft fair stall.[1]
- Your average home business costs at least $30,000 to get started, but you probably won’t need nearly that much to start making and selling soap.[2] Many handmade soap bloggers estimate that you can get things off the ground for closer to $1000, especially if you’re producing small batches and aren’t hiring any other employees.
- For detailed information about the financial aspects of running a soap business, explore the business and finance pages of the Handcrafted Soap and Cosmetic Guild website: https://www.thecosmeticboxes.co.uk/product/custom-soap-boxes-packaging-uk/.
[Edit]Follow local laws and regulations.
- Every country has its own rules about making and selling soap. In the U.S., many homemade soaps are actually classified as cosmetics, which are regulated by the FDA.[3] Before you start making and selling soap, consult the FDA small business guidelines for selling homemade cosmetics. For example:[4]
- If you plan to use any color additives, check to make sure the additive is on the FDA’s list of approved products for use in cosmetics.[5]
- Don’t try to claim that your soap treats any sort of medical condition without approval from the FDA. To make these claims, you must get your product officially classified as a drug or pharmaceutical.
- Follow the FDA’s Good Manufacturing Practice guidelines to avoid contaminating or mislabeling your products.[6]
- It’s not mandatory, but the FDA recommends that you register your company or products with the Voluntary Cosmetic Registration Program (VCRP).
[Edit]Label your products clearly.
- Include basic ingredient information on your labels. Depending on local regulations, you might need to include other information, such as a “use by” date, warnings (such as a “Do Not Eat” label), or a country of origin marker.[7] Additionally, include information like:[8]
- The name and scent of the soap (e.g., “Unicorn Love bomb, scented with patchouli and rose”).
- All the ingredients in the soap, listed in order by percentage from highest to lowest.
- The weight of the individual soap bar.
- The name and contact information of yourself or your business.
[Edit]Purchase liability insurance to protect your business.
- Even if you do everything right, the unexpected can happen. Before you start selling your soap—or even giving it away to friends and family—invest in a home business insurance policy. This will protect you from claims by consumers in case anything goes wrong (e.g., if someone has an allergic reaction or claims your product label is misleading). It will also cover the cost of damages in case your product is accidentally lost or damaged.[9]
- You can buy liability insurance directly from the insurance company, or join a trade organization that offers insurance coverage as a membership benefit.
- For example, you can get insurance coverage through the Indie Business Network or the Handcrafted Soap & Cosmetics Guild.
- Depending on how big your business is, where you make your soap, and whether you have employees other than yourself, you might need to purchase several different types of insurance. These could include general liability, product liability, home-based business, or commercial property insurance.[10]
[Edit]Keep good financial records.
- Good accounting is important for any business. Tracking profits and expenses will help you understand how your business is doing and give you a sense of where you need to make improvements—for instance, you might need to spend more on advertising, adjust your prices, or cut packaging costs. It’s also crucial to keep good records for tax purposes. Use software like QuickBooks to help you track your finances, and set up a dedicated bank account just for business purposes.[11]
- As your soap making business grows, you might want to hire a professional accountant to help you keep track of everything.
[Edit]Sell your soap for at least twice the cost of making it.
- You’ll need to charge more than you spend to make a profit. Sit down and create a detailed budget, then decide how much you want to mark up your products. You’ll need to take into account things like the cost of materials, labor, packaging, and overhead (other costs associated with your business, like advertising and fees for permits). From there, set a bare minimum price that you’d be able to charge per bar in order to make money back.[12]
- For instance, if it costs you $1.83 to make a single bar of soap, you might decide to charge at least twice that amount ($3.66) per bar for wholesale, and 4 times as much ($7.32) for retail. If possible, pad the price even more to take into account unexpected situations, like the price of an important ingredient going up.
- In addition to calculating your own production costs, look at similar products to find out what they usually sell for. For instance, if most soaps with the same ingredients tend to sell for an average of $12, aim for somewhere in that price range.[13]
[Edit]Target your products to a specific market.
- Do some research to find out what people are looking for. Different soaps meet different needs. You’ll have a better time selling your product if you know exactly who you’re pitching it to, and what they want. For example, you might market your ultra-gentle, moisturizing soaps to people with sensitive skin, or develop a line of glittery soaps for teens who love mermaids and unicorns.[14]
- Don’t try to make too many different things, especially when you’re starting out. Target a really specific audience and develop a few excellent products that they’ll want to tell their friends about!
- To get a sense of what’s out there and what people want, look at other shops selling handmade soaps. Check out which ones sell best and what people are saying about them. For instance, you might find that a lot of people are looking for a particular scent, or that there’s a big market for vegan ingredients.
[Edit]Develop a clear brand for your line of soaps.
- Your brand is all about how you present yourself and your product. Once you know what market you’re targeting, create a brand that will appeal to them. Choose a name for your store or product line that reflects your values and those of your customers. Work with an artist or graphic designer to develop an attractive logo and graphics for your storefront and labels if you don’t feel confident about making your own. Choose ingredients and packaging that also reflect what you want your business to be about.[15]
- For instance, maybe it’s important to your customers to buy an environmentally friendly product. In that case, use minimal, eco-friendly packaging, such as wrappers made of recycled paper. Advertise that your soap is made with sustainable ingredients.
- Create descriptions for your products that reflect your brand. For instance, “Celestial Soaps are made with planet-friendly ingredients and nature-inspired scents to soothe your body and soul.”
[Edit]Advertise your store through social media.
- You’ll need to get the word out to sell your product. This is important whether you’re using a marketplace like Etsy or selling directly from your own website. Use platforms like Facebook, Instagram, and Twitter to show off your latest soapy creations! Start by reaching out to your friends and family, and ask them to spread the word.[16]
- Some social media platforms allow you to create advertisements or featured/promoted posts for a fee.
- Don’t just stick to advertising your products—create interesting content that you think your customers will enjoy! For instance, you might do a weekly post on soap-making techniques or feature interviews with other people in the local cosmetic crafting scene.
- Use social media posts as an opportunity to interact with your customers. Be ready to answer questions, address people’s concerns, or just have a chat.
[Edit]Use a service like Etsy or Artfire to sell your soaps online.
- Pre-existing online marketplaces make it easy to sell your products. In most cases, it’s simple to sign up for an account, create product information pages, add pictures, and set prices for your products.[17] Just be aware that most of these websites will take a small cut of your sales, and price accordingly.[[Image:Sell [Homemade Soaps] Step 10 Version 2.jpg|center]]
- If you decide to sell through one of these marketplaces, read the rules carefully to make sure you are labelling your products according to their requirements.
- Check out the shops and listings of other sellers with similar products to get an idea of what works and what doesn’t.
- Good images are an important part of selling your items online, so take some high-quality, well-lit photos of each bar of soap to add to the listings.[18]
[Edit]Make your own website for more control of your business.
- This is a good option if you don’t want to give up a cut of the profits. You’ll also have more flexibility to design the look and features of your online store. If you decide to go this route, you’ll need to grab a good domain name and choose a host and content management system (such as WordPress, Drupal, or Squarespace) that meets your needs. You’ll also need to choose a good platform for financial transactions, like Shopify, PayPal, or Business Squarespace.[19]
- You’ll need to create appealing product pages with good pictures and clear descriptions, just like you would on a website like Etsy or Artfire.
- You can also have your own website in addition a store on a marketplace website, if you like.
[Edit]Get a booth at a farmer’s markets or craft fair.
- Local marketplaces are a great place to make connections. Check Craigslist or jump on a local craft forum to find out about markets and events in your area. Setting up a booth at a local market will help you make direct connections with customers and meet other makers and sellers with similar interests. When you sell at one of these events, you can:[20]
- Ask customers if they’d like to sign up for your mailing list. This is a great way to get return customers and grow your customer base!
- Include marketing materials along with the product, like sale flyers, coupons, business cards, and free samples.
- Offer special services like gift wrapping for an extra charge to make a bit of extra money.
- Make stronger connections with your customers by having personal conversations and offering tips on how to use your products.
[Edit]Sell your soap in local health and beauty stores.
- Local stores can sell your soaps on consignment or wholesale. Visit or call around to health and beauty stores in your area to find out if they’re buying from local soap makers. This can be a great way to make money on your products quickly and free up more time for yourself—since the store will do most of the marketing and selling for you![21]
- Get familiar with some of the different ways that third party businesses can buy and sell your products. For example, if they buy the product directly from you at a discounted price, that’s wholesale. If they take the product from you and pay you a percentage of the profits once they make a sale, that would be consignment.[22]
- Another option is to formulate and create soaps specifically for a store or boutique, which is called “contract manufacturing.”
[Edit]Video
[Edit]Tips
- In the U.S., plain soap (that is, a product made of fats or oils and lye, with no synthetic detergents, perfumes, or other additives) is regulated by the Consumer Product Safety Commission, rather than the FDA.[23]
[Edit]References
- ↑ https://www.thecosmeticboxes.co.uk/product/custom-soap-boxes-packaging-uk/
- ↑ https://www.mbda.gov/news/blog/2011/11/how-estimate-cost-starting-business-scratch
- ↑ https://www.fda.gov/cosmetics/cosmetic-products/frequently-asked-questions-soap
- ↑ https://www.fda.gov/cosmetics/resources-industry-cosmetics/small-businesses-homemade-cosmetics-fact-sheet
- ↑ https://www.fda.gov/cosmetics/cosmetic-ingredient-names/color-additives-permitted-use-cosmetics
- ↑ https://www.fda.gov/cosmetics/cosmetics-guidance-documents/good-manufacturing-practice-gmp-guidelinesinspection-checklist-cosmetics
- ↑ https://www.lowimpact.org/starting-your-own-business-how-to-sell-hand-made-soaps/#
- ↑ https://www.soapqueen.com/business/so-you-want-to-sell-your-soap-part-one/
- ↑ https://www.modernsoapmaking.com/blog/absolutely-need-insurance-sell-single-bar-soap
- ↑ https://www.modernsoapmaking.com/blog/understand-business-insurance-needs/
- ↑ https://www.modernsoapmaking.com/blog/getting-started-with-bookkeeping/
- ↑ https://www.modernsoapmaking.com/blog/knowing-real-cost-products
- ↑ https://www.canr.msu.edu/news/pricing_my_craft_item_how_much_should_i_charge
- ↑ https://www.modernsoapmaking.com/blog/what-you-need-to-know-to-start-a-soap-business
- ↑ https://www.modernsoapmaking.com/blog/what-you-need-to-know-to-start-a-soap-business
- ↑ https://www.soapqueen.com/business/tweeting-blogging-posting-poking-2/
- ↑ https://www.thecosmeticboxes.co.uk/product/custom-soap-boxes-packaging-uk/
- ↑ https://www.modernsoapmaking.com/blog/what-you-need-to-know-to-start-a-soap-business
- ↑ https://www.forbes.com/sites/allbusiness/2019/05/25/small-business-website-tips/?sh=5ffe03a721ad
- ↑ https://www.modernsoapmaking.com/blog/advice-for-holiday-craft-show-success
- ↑ https://www.modernsoapmaking.com/blog/reasons-to-wholesale-handmade-soap/
- ↑ https://www.modernsoapmaking.com/blog/wholesale-primer-and-words-you-need-to-know
- ↑ https://www.fda.gov/cosmetics/cosmetic-products/frequently-asked-questions-soap
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