# Maybe Considering Selling



## MellonFriend (Jun 6, 2022)

So I've been soap making for about a month shy of a year now.  I've been taking my time with my recipes, and I've hit on a few really solid ones.  I've been sharing pictures of each of my batches on a goat forum that I'm on, and I consistently get asked by people if I'm selling them anywhere.  People seem to think my soaps look really amazing, and I feel like I might get a decent response if I were to try an sell some.  But I just don't know if it's a door I want to open.  Here are some of my concerns: 

I don't want to have to make soaps that I don't enjoy making just because they sell well
I'm afraid that the pressure of producing would suck the fun out of it
I typically work with two pound batches of soap so I would have to invest in some larger equipment/more ingredients and I'm afraid to make that investment if I'm not going to make my money back
I don't enjoy making batches the exact same way multiple times
Basically I'm asking, is there a way to sell soap that isn't a business?  I don't need this to be a big money making machine.  Is there a way to just sell soap casually?

If the answer is yes, then I would still need to do a lot of work before I started.  I haven't developed a line of FOs that I know stick well, and I'd need to give out some free bars to more people than my family to know if I really have a solid recipe that works for lots of different people/water types/climates. 

I've attatched some pictures of my soap in case my soaping style has anything to do with any of my questions.

Any help would be appreciated!


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## TheGecko (Jun 6, 2022)

MellonFriend said:


> Here are some of my concerns:
> 
> I don't want to have to make soaps that I don't enjoy making just because they sell well
> I'm afraid that the pressure of producing would suck the fun out of it
> ...


I only make soaps that I enjoy making.  With that said, I hadn't planned on making a Lavender Soap simply because I'm allergic to it, but managed to find a FO that I could tolerate.  Else-wise...I don't follow trends or gimmicks or using scents that I don't like simply because if they don't sell, then I'm stick with it.

Yes it will.  It's one of the things I struggle with...making soap when I don't feel like it because I have a headache or I didn't sleep well or because the sun is shinning and I want to be outside.  

I know that all your friends think that your soap is the bomb and that you're going to be the Bill Gates of the soaping world, but it won't happen tomorrow, or next week or next month.  If you fill two 10" loaf molds every day for a week...that's a 140 bars of soap...do you really think that you're going to sell 140 bars of soap next week?  Even if you only made one batch a day...that's still 70 bars of soap

It's your call.  I know a soap maker who only makes 12, uncolored Goat Milk Soap and has been for 20 years.  I know another soap maker who never repeats a design or scent within a year.  There are a lot of soap makers like myself...we might have a standard line of soaps that customers can count on, but we also make whatever soap we want.

Yes...the IRS calls it a "Hobby Business" where you only report the income you make from it...you don't have to track expenses or mileage or file a Schedule C and pay SE tax...just income tax.  BUTT (and that's a big 'but'), you're still going to need insurance, you're still going to have to adhere to good manufacturing practices and you're going to have to check with your local laws because you are using Sodium Hydroxide.

But other than fun...have fun making soap.


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## MellonFriend (Jun 7, 2022)

Thanks for taking the time to respond, Gecko. 



TheGecko said:


> I know that all your friends think that your soap is the bomb and that you're going to be the Bill Gates of the soaping world, but it won't happen tomorrow, or next week or next month. If you fill two 10" loaf molds every day for a week...that's a 140 bars of soap...do you really think that you're going to sell 140 bars of soap next week? Even if you only made one batch a day...that's still 70 bars of soap


I hope you don't think I'm arrogant for saying I've had and incredibly positive response to my soap.  I certainly don't think they think I'm a prodigy soap maker or anything.  And nor do I.  I know that if I were to want to become a profitably business that it would be a long slow climb to profitability, but that's not what I'm asking about. 


MellonFriend said:


> Basically I'm asking, is there a way to sell soap that isn't a business? I don't need this to be a big money making machine. Is there a way to just sell soap casually?


It sounds like the answer to this is no. 

Okay so I guess what I have to ask myself is do I really need to make a profit.  I mean, am I okay with not making a profit.  Maybe I'd just rather sell my soap to the people that like it at a beak even price just because it seems to make people happy.  I'll have to do some soul searching, but I really don't think I want to become a business.  I think what I'd like to do is basically sell some extra bars here and there whenever I have them.  If people buy them, great!  If not, that's fine too, as long as I don't shoot too high in my investment of materials.  This would then reduce the price of my hobby and also dip my toe in the waters of soap sales to see how much of a reaction I get to them.  I'm sort of thinking out loud here.

Insurance is the kicker I guess.  Is that something I still need to sell any soap at all?


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## AliOop (Jun 7, 2022)

@MellonFriend those are all the same questions that I've been dithering about for awhile now. There are three things that I know I don't like (actually, that I HATE) about selling:

1. Packaging (including labeling)

2. Tracking supplies and finished inventory.

3. Dealing with social media. I'm not on FB, Pinterest, or TikTok. My IG has zero posts since I only use it to look at other's soap pics. I really don't have any interest in changing that or marketing my soaps that way.

Milder dislikes include photographing, maintaining (another) website, and packaging for shipping.

For that reason, I've limited myself to selling at cost or a little higher to my friends (family still gets it free). I recently signed up for a couple of craft fairs and am kind of kicking myself because I really have to do labels now. But I'm trying to push past it and see if I can get into a comfort zone where it doesn't feel like such a chore. If not, then selling really isn't for me.

I do strongly recommend insurance when you are selling. Here was my latest info on that: Insurance Policies


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## MellonFriend (Jun 7, 2022)

AliOop said:


> @MellonFriend those are all the same questions that I've been dithering about for awhile now. There are three things that I know I don't like (actually, that I HATE) about selling:
> 
> 1. Packaging (including labeling)
> 
> ...


I'll have to go check out that insurance thread when I get the time.  That's likely going to be a big deal breaker.  I can't see myself investing in insurance if I'm now not going to profit.  I think that packaging and labeling could be something I would have fun with (who knows for how long though).  I have_ zero _social media presence so if that's a must for successful selling, then I'm definitely out.

I wish you good luck at your craft fairs!


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## AliOop (Jun 7, 2022)

The least expensive insurance is about $250/year. If you break it down, that's just over $20/month. Doesn't sound so bad that way.  And knowing that helps you budget for the true cost of your products.


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## MellonFriend (Jun 7, 2022)

AliOop said:


> The least expensive insurance is about $250/year. If you break it down, that's just over $20/month. Doesn't sound so bad that way.  And knowing that helps you budget for the true cost of your products.


That doesn't sound too bad.  Thanks for your help, AliOop!  I have a lot of thinking and calculating to do!


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## Vicki C (Jun 7, 2022)

I started selling last summer and I am having a blast. That being said, I retired from my job and didn’t plan to work, so any income is just fun money. I bought insurance, researched labeling, and figured out what I wanted for packaging. It’s all doable. I think the US is simpler than many places for selling but I don’t know where you are. I guess I would say don’t be intimidated - if you are excited about it you can start small and see where it goes.


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## TheGecko (Jun 7, 2022)

MellonFriend said:


> Thanks for taking the time to respond, Gecko.
> 
> 
> I hope you don't think I'm arrogant for saying I've had and incredibly positive response to my soap.  I certainly don't think they think I'm a prodigy soap maker or anything.  And nor do I.  I know that if I were to want to become a profitably business that it would be a long slow climb to profitability, but that's not what I'm asking about.
> ...


I think you misunderstood (or I did a really bad job explaining) in response to:  "I typically work with two pound batches of soap so I would have to invest in some larger equipment/more ingredients and I'm afraid to make that investment if I'm not going to make my money back."  So let me try again.

When I decided to go from hobby to business I bought two things...a second mold and a cheese slicer.  That's it.  And obviously I had to buy more ingredients, because I was making (and selling) more soap), but it's not like I went from buying a pound of Cocoa Butter to a 55lb box...I bought two pounds...and then I bought 5lbs...and then I bought 10lbs.  And once I went from buy by the pound to buying 5lbs...the price per pound dropped.

In other words, don't put the cart before the horse...don't borrow trouble...just buy what you need for right now.  If you need more later, then you buy more later.

No...the answer was yes.  You don't have to have a formal business to sell soap, but you are legally required to report the income...as with ALL income.  The only exception, with limitations, is garage sales or anything that you sell at a loss.  I paid $15,000 for my car.  I sell it for $10,000.  The $10k is NOT 'income'.  But if I sell it for $17,500...I only have to claim $2,500 as income.

As for insurance...no question that you need it if you are selling because your homeowner/rental policy is NOT going to cover you if your soap hurts someone.


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## Vicki C (Jun 7, 2022)

TheGecko said:


> .
> 
> As for insurance...no question that you need it if you are selling because your homeowner/rental policy is NOT going to cover you if your soap hurts someone.


Also, farmers markets etc pretty much always require that you be insured.


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## MellonFriend (Jun 7, 2022)

TheGecko said:


> I think you misunderstood (or I did a really bad job explaining) in response to:  "I typically work with two pound batches of soap so I would have to invest in some larger equipment/more ingredients and I'm afraid to make that investment if I'm not going to make my money back."  So let me try again.
> 
> When I decided to go from hobby to business I bought two things...a second mold and a cheese slicer.  That's it.  And obviously I had to buy more ingredients, because I was making (and selling) more soap), but it's not like I went from buying a pound of Cocoa Butter to a 55lb box...I bought two pounds...and then I bought 5lbs...and then I bought 10lbs.  And once I went from buy by the pound to buying 5lbs...the price per pound dropped.
> 
> ...


Okay thanks for clearing that up!  All of that makes a lot of sense.


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## Zany_in_CO (Jun 7, 2022)

MellonFriend said:


> I don't want to have to make soaps that I don't enjoy making just because they sell well


Then don't! LOL


MellonFriend said:


> I'm afraid that the pressure of producing would suck the fun out of it


Then stop it when it's no longer any fun. Making $$$ is fun too, ya' know?


MellonFriend said:


> I typically work with two pound batches of soap so I would have to invest in some larger equipment/more ingredients and I'm afraid to make that investment if I'm not going to make my money back


No worries. No need to add anything to what you already have. Just keep toodling along at a pace you enjoy and when you have enough to sell, sell.


MellonFriend said:


> Basically I'm asking, is there a way to sell soap that isn't a business?


Of course there is!!! I sold my soaps at my annual garage sale every year for the first 4 years. Made $350-$500 each year -- enough to by supplies for the following year. And so the vicious cycle began.  


MellonFriend said:


> I've been sharing pictures of each of my batches on a goat forum that I'm on, and I consistently get asked by people if I'm selling them anywhere.


I LUV the look of all your soapies. Just keep doing what your doing, post pics & prices when ready to sell -- bundling is a good idea if shipping is involved. You can fit 9 bars (If I remember correctly) in a USPS Flat Rate padded mailing envelope.


MellonFriend said:


> If the answer is yes, then I would still need to do a lot of work before I started. I haven't developed a line of FOs that I know stick well, and I'd need to give out some free bars to more people than my family to know if I really have a solid recipe that works for lots of different people/water types/climates.


You really don't need to do all that. Just keep doing what you're doing and see how it all plays out. Soap is soap, whether east, west, north, south. I have a feeling you are going to be pleasantly surprised. After all, you're serving a ready-made customer base. Don't put it off. Think of it as a hobby. Also a fantastic opportunity to support your addiction!!!


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## MellonFriend (Jun 7, 2022)

Thanks for the encouragement @Zany_in_CO!  I think I might just take it slow and start out by selling to some people on the goat forum I'm on and sort of get a feel for if I like selling or not.


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## Zany_in_CO (Jun 8, 2022)

"Casual" sales up to $3,000 are not the same as selling retail and don't have to be reported on your income tax, according to our CPA. Check with your accountant to be sure if that's true for you -- just for your own peace of mind. Don't worry about all the other stuff until you want to incorporate (LLC) and actually go into business.


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## TheGecko (Jun 8, 2022)

Not to put down your CPA or anything, but there have been some changes this year as the IRS cracks down on "micro businesses".  One of these changes are going to effect those who receive Payment Card and Third-Party Network Transactions from places like Etsy, eBay, FBMarketplace, and other 'shopping cart' source.  It used to be that you had to exceed $20,000 in total sales to be issued a Form 1099-K...it's now $600.

And just yesterday I was reading up on New York Sales Tax because we may be picking up a client there and man...I can't believe how greedy/desperate that state is!  The IRS has always had rules about garage sales and sales of personal property...while there were some small limitations, it wasn't considered income because you can't claim a loss.  For NEW YORK:  Rule #1...the sale has to take place at your residence and it can only be your property.  Else-wise it's considered a 'community sale' and you have to collect/pay sales tax on everything.  Rule #2...max of three sales days per year....or you have to collect/pay sales tax.  Rule #3...the total cannot exceed $600 per year, or you have to collect/pay sales tax.  And let's say that you want to get rid of your dining room set.  You paid $2500 and sell it for $800; yep, gotta collect/pay sales tax.






						Here’s what taxpayers need to know about paying taxes on their hobby activities | Internal Revenue Service
					

Tax Tip 2021-94, June 30, 2021




					www.irs.gov
				




_Many people are engaged in hobby activities that are also a source of income. For example, some people started selling handmade items during the pandemic. These people must report this income on their tax return.

A hobby is any activity that a person pursues because they enjoy it and with no intention of making a profit. This differs from those that operate a business with the intention of making a profit.

If a taxpayer receives income from an activity that is carried on with no intention of making a profit, they must report the income they receive on Schedule 1, Form 1040, line 8._

As someone who used use eBay as a way to sell off my crap, I'm still reading up on the Form 1099-K stuff.


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## Zany_in_CO (Jun 8, 2022)

TheGecko said:


> It used to be that you had to exceed $20,000 in total sales to be issued a Form 1099-K...it's now $600.


Oh good grief!


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## TheGecko (Jun 9, 2022)

Zany_in_CO said:


> Oh good grief!


Gotta pay for all that ‘free’ money the government gave out (speaking US only).  The extra $600 a week in unemployment.  Those ‘stimulus’ checks.


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## KiwiMoose (Jun 9, 2022)

I've been selling for nearly four years I think.  I have one two-pound mold that I use regularly. I also have a few slightly larger molds ( about three pounds) that my hubby made for me.  I recently started back working full-time (previously 0.5) and I must admit is a little bit more of a chore than it was - squeezing all my soap making  (and other crafts) into two days.  But i do still enjoy it - otherwise I wouldn't have anything to do!
Up until three months ago I only ever made one (2 pound, or 3 pound) batch at a time. That's it.  you don't need a big production-line like you see on some of those soap making videos. I made about two or three batches per week.
Now I work full-time I make a double batch any the weekend and split it in half to make two different soaps.  I still use my two-pound mold mostly, but the second batch is always in cavity molds.
I tend to only make what I like, and change things up with different FOs and swirls etc. But I do make things i wouldn't make for myself that i know other people like - rose, lavender, etc.
I have some regular fragrances that I make over and over.  I may not always present them the same way though - the swirl or colours might be different for example. If it stops being fun I'll stop doing it.  But it hasn't stopped being fun yet because there's always something new to try.
The money I make covers my costs and makes a reasonable profit.  But it's not 'big business' by any stretch.
ETA - last weekend's double batch:
Orange Blossom and Fig & Cassis.


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## lucycat (Jun 9, 2022)

You can make your soap any level of business you want.  It doesn't have to be difficult in the US.   For a small business it is really nice to have repeat customers (not just friends) and that takes time to develop.  So, going slow, trying out different things gives you time to find your style and your commitment as you build repeat customers.   

I do think you have a better understanding of fragrances by doing some selling in person.  Like others, I found selling to be fun since I love my product. So, having some regular venue where customers can plan on you is a slow but easy way to develop a repeat customer base.

Insurance is the biggie.   I am retired and have a pension.  The liability risk for a small hobby business isn't worth it.  If you pay $250 for insurance and sell 250 bars then you have $1 cost in every bar for insurance.  That is probably the most important calculation of whether you want to sell enough soap to keep that insurance cost per bar of soap sold reasonable for the sales price of the soap.  Although you can price your soap whatever you want there will probably be a market rate in your community where you will sell best, regardless of your costs.  

Any net profit from a business is taxable in the US.  A hobby or a real business operate the same. Each state is different on sales taxes and some states keep it simple by paying sales taxes at the end of a fair.   I keep sales and cost records in a spreadsheet and it is easy to pull together at the end of the year.  It doesn't have to be difficult.

Yes, labels are very doable.  I use cigar bands which I like, print them on cardstock and set up my label design with Publisher.  They have a basic look and I change the name, background color, and ingredients for each new scent.  The weakness of cigar bands is they loosen as the soap ages but I don't need to label until I right before I sell.   Make your own today and then change if/when it no longer works for you.

I never planned on having regular soaps but that happened from customer requests.  So, after 15 years I have about 2/3 of the soaps I make are the same as in past years and then about 1/3 are new each year.   I have customers at fairs who want a specific soap as well as customers whose first question is what is new.   As the years have past this has worked.  Some soap days are simple and others are trying new fragrance blends and design techniques that take more time.


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## Zany_in_CO (Jun 9, 2022)

KiwiMoose said:


> The money I make covers my costs and makes a reasonable profit.


   It's the most one can hope for at this stage of the game...


lucycat said:


> For a small business it is really nice to have repeat customers (not just friends) and that takes time to develop. So, going slow, trying out different things gives you time to find your style and your commitment as you build repeat customers.


  So true. I've seen it happen many times over the years. It takes time to build that customer base... think "4 years" while you proceed at your own pace.


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## TheGecko (Jun 9, 2022)

KiwiMoose said:


> That's it. you don't need a big production-line like you see on some of those soap making videos.


Speaking of which...these folks have been in business for many years and have built up their business to a level to warrant making 40, 50 to 60 bars per batch.  And then there are the soap makers who have also been in business for many years and all they use are 2lb molds and make xx soaps a month and that's it.



lucycat said:


> I never planned on having regular soaps but that happened from customer requests. So, after 15 years I have about 2/3 of the soaps I make are the same as in past years and then about 1/3 are new each year. I have customers at fairs who want a specific soap as well as customers whose first question is what is new.


I did, but that is because that is how I am when I buy things...I'm a creature of habit.  It's also how I set up my business aesthetic and the majority of my customers buy the same as the time before.  But they also sometimes like to try something new, they like to purchase soap as gifts...as do a lot of my other customers.  And so I make seasonal scents and I make 'one-offs'...something that sounds good to me, sometimes something that is on sale*** and always in small batches so I don't get stuck with a lot of soap if it doesn't sell.

*** - Which can suck if it's well-received and turns out it was sale because it was being discontinued


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## Zany_in_CO (Jun 9, 2022)

MellonFriend said:


> Insurance is the kicker I guess. Is that something I still need to sell any soap at all?


Not at this point. For one thing, you can't afford it!  Although the game has changed, I sold soap at garage sales for 4 years making just enough to re-invest to buy supplies for 4 years. Then I started making soap and other products for 3 wholesale customers (for 10 years) who carried insurance at their point of incorporation to cover liability in the market place.


AliOop said:


> I do strongly recommend insurance when you are selling. Here was my latest info on that: Insurance Policies


Good advice when you get to the point where AliOop is now.


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## TheGecko (Jun 9, 2022)

Zany_in_CO said:


> It's the most one can hope for at this stage of the game...
> 
> So true. I've seen it happen many times over the years. It takes time to build that customer base... think "4 years" while you proceed at your own pace.


Absolutely...though I'm not quite there yet, but that's my fault.

When starting a new business from scratch, it can take a good five years before you start operating in the "black".  That's the point where 1) your Income is greater than your COGS/Expense, 2) your Income has enable you to pay yourself back, 3) that your Income can pay you.


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## Zany_in_CO (Jun 9, 2022)

@TheGecko Your common sense approach is gratifying and you are an invaluable asset, not only to me, but I believe to the entire SMF community.


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## TheGecko (Jun 9, 2022)

Zany_in_CO said:


> @TheGecko Your common sense approach is gratifying and you are an invaluable asset, not only to me, but I believe to the entire SMF community.
> View attachment 67166


(blushing)  Thank you.  Sometimes I think I'm too wordy, but I made a LOT of mistakes in the beginning due to a lack of simple information/instructions.


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## cmzaha (Jun 9, 2022)

When I was selling I had a large following and had to keep certain fragrances in stock at all times. My Dragon's Blood I need to always have, In another market, I had to always have Bonsai from Oregon Trails in stock, and in all markets, I had Lemongrass, Lavender, Nag Champa, and Caramel Tobacco in stock at all times. I always had approx 40 different fragrances in stock most of the time with vegan, non-vegan, a couple of salt bars, and a couple of shea facial bar soaps in stock. After time you learn what sells at different markets if you attend more than one weekly market regularly which my husband and I did for about 7 years, (up to 5 per week), cutting back to 1 or 2 the last 3 years of our selling. We retired during the beginning of covid when we lost our main market and due to age and health issues, it was just time. It took about 3 yrs to build a following of customers within a 75-100 mile radius and a lot of hard work, but we made money, although I will not say a lot of money it was a good retirement supplement for us and we also used it for entertainment. We loved meeting new people and seeing our vendor friends which we still keep in touch with. I still hear from former customers since I retired. Just remember some weeks you may not sell any soap, and some weeks you may do great, but I also sold other items such as my husband's golf art and horseshoe, depending on which market we were attending, and my crochet hats. It is hard to survive selling soap alone in my opinion. We also attended a couple of Holiday markets every year where I had customers that waited to buy from me and purchased a year's worth of soap. 

As for taxes, my little business was set up as a business claiming sales taxes, and IRS taxes were filed as a small business. I was not set up as an LLC, I just do not find enough protection with small corps to go through the hassles of corp structures to go under corps. Yep, I had to corporation one S and one C corp, so I do have some experience with corporations, never again. If a person decides to sue you they will go civil and sue you personally. I carried good insurance under the Guild and was very careful to cover all bases so in 10+ yrs of selling I was never sued. We were threatened once and apparently, she decided she would not win because we never heard from her. Over 30 of self-employment in my moms 50 yr old beauty shop we were never sued, because we were careful. 

Sorry for the long-winded post. Bottom line, do not expect to make lots of money but if you enjoy selling go for it if not, don't. It is hard work.


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## MGM (Jun 10, 2022)

I think the big question isn't "Can I sell soap without having a business" but "Can I sell soap without [incurring the costs of] insurance?" My understanding that the answer to that is NO.  Here in Canada, you must also register each and every product (including variations on colour and fragrance) with Health Canada. Do the people I see at pop-up fairs do that? I'm thinking not, given the way they create their labels, etc. Are they taking a risk? I think so. In a more litigious society like the US, would that be an even bigger risk? Probably.


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## MelissaG (Jun 11, 2022)

If you have a business, you need insurance and you need to pay taxes. There's no way around that. And if you try to do otherwise, eventually the government will catch up to you and you are looking at long term prison time. Just play the game the right way the first time around.


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## AAShillito (Nov 13, 2022)

Zany_in_CO said:


> Oh good grief!


It sucks. Ive sold alot on ebay this year to pay for soap supplies with the cost of ingredients going up.  So im sure my accountant will be getting an even  larger pile of paper this year

@MellonFriend, if you do decide at some point to go the official business way just remember business taxes/ tax forms  are always due in March vs typically personal taxes in April. 

As far as labels, avery.com is super easy to navigate. You can print them yourself or avery can do so for a price. But ive been printing my own for 18 months with no issues.


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## MellonFriend (Nov 14, 2022)

AAShillito said:


> It sucks. Ive sold alot on ebay this year to pay for soap supplies with the cost of ingredients going up.  So im sure my accountant will be getting an even  larger pile of paper this year
> 
> @MellonFriend, if you do decide at some point to go the official business way just remember business taxes/ tax forms  are always due in March vs typically personal taxes in April.
> 
> As far as labels, avery.com is super easy to navigate. You can print them yourself or avery can do so for a price. But ive been printing my own for 18 months with no issues.


Thanks for the tips!  I am still considering my options, but I have decided to reformulate my main soap recipe, so that has set me back to testing phase.  It might be a little bit before I feel I'm ready for my product to be sold.


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