A Guide Through Selling Handmade Soap

[Rosey]

Yeah but where would the fun in that be?

 

[Guest]

Yeah but where would the fun in that be?

It wouldn't be any fun at all :wink:

Here is an idea though . Bear in mind I have no idea why the previous owners of our house did this , but . In addition to the regular shelf ,they put an 18 inch wide shelf in all the closets about 2 or 3 feet feet from the ceiling , if I run out of room to store soap I figure that space is fair game

Kitn

 

[gekko62]

Im so glad you took the time to do this Dagmar. Thankyou

I voted yes because I do want to sell someday -just in a small,market based way as a means of breaking even.

 

[dagmar88]

Hey Oldragbagger,
From what I know that shoudn't really be a problem; as long as you don't sell soap to make a profit, you're allowed to sell as a hobby.
So you could make a calculation of what each of your soaps costs and make sure you calcultate everything from molds to gass.
When can show you break even, you're fine.

Not so in the US. If you sell 1 bar of soap you must collect sales tax & have your biz set up to meet your state standards.

hmmm, interesting, I had read that somewhere but didn't think of saving the url...

 

[oldragbagger]

Not so in the US. If you sell 1 bar of soap you must collect sales tax & have your biz set up to meet your state standards.

Actually, there are exceptions to that also. The main one is selling online or to customers outside your own state. If you are selling "across state lines" you do not collect taxes.

Another exception would be if you are selling wholesale to someone else who is going to resell. In that case, it is their responsibility to collect the sales taxes.

 

[Bnky]

Thank you for this very informative post. HELP...I would love to sell soap in the future, and am still working on a spreadsheet and business plan in hopes that one day I can (as well as a perfected soap). But after much research; on corporations/LLC, insurance, copywrights, trademarks, figuring costs of materials, website, etc., I can't imagine how much soap I would have to make and sell to come out ahead. And, when I see some soaps are selling below $3.50 for a bar, I know I could not compete with that kind of pricing. Can you explain how it is done? Thanks for any assistance.
Bnky

 

[oldragbagger]

Thank you for this very informative post. HELP...I would love to sell soap in the future, and am still working on a spreadsheet and business plan in hopes that one day I can (as well as a perfected soap). But after much research; on corporations/LLC, insurance, copywrights, trademarks, figuring costs of materials, website, etc., I can't imagine how much soap I would have to make and sell to come out ahead. And, when I see some soaps are selling below $3.50 for a bar, I know I could not compete with that kind of pricing. Can you explain how it is done? Thanks for any assistance.
Bnky

Those are really great questions, and legitimate concerns I think. I have been grappling with the same issues. I do not want to have a large business. I have a good, secure job that I like. I have an 80 year old house that is in "constant need" and my husband and I are active boaters. So..... soap is a wonderful hobby and pastime and I love it very much, but cannot foresee the day anytime in the near future where there would be enough time in my days to produce and market (which I think takes even more time than actually making the soap) the amount of soap that you would have to sell to cover all those costs you mentioned.

I can see how LLC, license expenses, insurance and the rest would absolutely exceed $500, and depending on where you live could come closer to $1000 a year. If your actual profit on a bar of soap were $2.00 after the costs of making it, packaging it and marketing it were accounted for (and I think that is being terribly optimistic to start with, I think $1.00-$1.50 is more realistic from the figures I have come up with) then your first 500-750 bars of soap are givaways.
I make about 15 bars a week tops, sometimes less if I'm playing with test batches, so, let's see, it would take me 50 weeks to make enough bars to cover my costs. And the marketing part would probably knock the fun right out of it, because there would be pressure. Now I'm into for all these expenses so I HAVE TO make and sell enough soap.
Good grief, I start feeling panicky just thinking about it.

But what I would really love to do is just sell a few bars here and there to help subsidize the costs of my habit. Not fully cover it, I mean, there's such a fun factor in it for me, and I love giving it as gifts, and we all spend money out of our pockets to have fun and give gifts, right?? But in the process of having fun, I do end up making more soap than I can use or that I have reasons to give away.

I have read on other sites where some soapers, who sell it as hobbyists only and not as serious business people, say that they have just decided to take the risk. But it's a pretty big risk in my opinion. It's not like you're selling handmade aprons. This is stuff that they are going to take and rub all over thier bodies. It almost makes it IMPOSSIBLE to think of selling soap as a hobby venture. Unless you are selling to friends, co-workers and acquaintences, people who you trust, who are not going to be likely to engage you in litigation if it turns out one of your bars of soap doesn't agree with them.

If there is some magic answer as to how to work around this problem, I would absolutely love to hear it.

 

[jarvan]

As a new soaper, supposing I opened a store or sold at a flea market, would I be able to answer all my customers' questions? What if one of those people inquiring about my soaps is, indeed, a very experienced soaper choosing to test me? Could I answer those questions rationally and without hesitation or fudging? NO. I could not do those things at this point and not at any time in the near future. Once I feel confident to field all this and carry liablity insurance, then fine. For now, I have no business selling my wares to any customers. Now...giving them out as testers...another story. How will I ever learn what works for others if others never test my product.

 

[oldragbagger]

As a new soaper, supposing I opened a store or sold at a flea market, would I be able to answer all my customers' questions? What if one of those people inquiring about my soaps is, indeed, a very experienced soaper choosing to test me? Could I answer those questions rationally and without hesitation or fudging? NO. I could not do those things at this point and not at any time in the near future. Once I feel confident to field all this and carry liablity insurance, then fine. For now, I have no business selling my wares to any customers. Now...giving them out as testers...another story. How will I ever learn what works for others if others never test my product.

In some respects, I do see your point, Jarvan. And this becomes increasingly complicated and important as your line of products becomes more complex. I can see where the learning curve can be high if you're making a half dozen different soap recipes and additional bath and body. I know there are a lot of soapers out there, and on this forum as well, that want to find a niche by finding "solutions" to peoples skin problems or make products that address particular needs. And for these people, definitely, being well educated is an absolute must. Obviously, you can't speak with any authority about why your product is able to acheive these desired effects if you aren't well educated on the subject. Same is true for those who want to create their own "unique" recipes and are trying uncommon things.

But soap, in and of itself, if kept basic, is really a pretty simple commodity that has been around for thousands of years. Granny didn't have a masters degree in saponification when she threw it in the pot. It was a basic necessity produced in a very simple way. I'm not producing complex chemical formulations aimed at curing anyone's skin problems. That may be what some choose to do, but I am not a member of that group. I have one basic, simple recipe that I only vary in which butters I add (shea, cocoa or mango at this point). It has been tested and proven over time, long before I started using it, because it is such a basic recipe that you can find on dozens of websites and in numerous books. I make soap, plain and simple, from the most basic oils, with a little fragrance added. No reinvention of the wheel here. (But, I grant you, if I was trying to come up with something totally new and unproven, I'd want to be darn sure that my thinking was correct and my desired outcome had been acheived with lots of testing before I unleashed it on an unsuspecting public.)

If I can't explain basic soap principles to people, then, you're right, I would have absolutely no business selling anything. But my one basic recipe has been used and tested by numerous friends and family for several months now, many bars, with nothing but rave reviews and no problems, and I have spent untold numbers of hours until late into many nights reading and researching anything and everything I could find on the subject. (I had been doing that long before I ever made my first batch, and do it still almost obsessively. Ask my husband.)

I still have some of the first bars made in my linen closet, no DOS, and nothing else remarkable or unusual, just soap.

I think I understand the basics of soap. I don't think it takes a rocket scientist to understand or explain it in it's simplest form. Unless I was aiming for something more complicated than a basic cleansing bar, I am having a hard time understanding how hard it would be to explain to someone that my simple OO-CO-PO-Castor soap is going to get them clean, and it smells nice and that's pretty much the end of the story.

I do agree with you on the insurance issue though, which is why I have not sold any soap, and may not ever do so unless I foresee that I have the time and commitment to make and sell enough soap to cover the cost of insurance. (Except perhaps for the occassional friend or co-worker.) And that doesn't have anything to do with having doubts about the safety of my soap. It has more to do with the nature of people and knowing that there are those out there who would just love to try and sue you because they trip and fall in the bathtub because they stepped on the bar of soap you made. Think hot coffee in the lap.)

 

[Guest]

Good post Dagmar Thank you for taking the time to do it , it is much appreciated .

Kitn