Did you profit this year?

[Tabitha]

OK, I am working on my taxes & when I saw how much I spent for a year on supplies I was shocked. So I decided to see how my income matched my outgo.

My income was 3 to 1 which means, for every 100 I spent, I made about 300.

Income to outgo would idealy be 4:1. which means I am either wasting too much or not marking my product up high enough.

How about you?

 

[jcandleattic]

LOL - Can I plead the 5th?
I have WAY too much inventory and buy for everything I want to try and never get around too, and don't really have a good customer base, don't market myself well enough and only do 1 show a year, so in a word - no, I didn't profit this year. LOL

 

[Pug Mom]

Income to outgo would idealy be 4:1. which means I am either wasting too much or not marking my product up high enough.

It could also mean that your inventory on hand is too high, soaps and supplies. Sorry, the accountant in me is coming through... :roll:

 

[Deda]

Not a single dime.

I spent around 7K this year on supplies. Test test test. I never even offered a single item for sale. I did a bunch of promo stuff, giving product away in return for contacts and networking. Now I have several places interested in carrying my products. I did get some really great publicity and I got in a good juried show. So with a lot of hard work I may have a different answer next year.

 

[Tabitha]

It could also mean that your inventory on hand is too high, soaps and supplies. Sorry, the accountant in me is coming through...

I roughly keep the same amount of supplies & stock on hand.

Deda, OMG! That's a lot of testing!

 

[Tabitha]

I have WAY too much inventory and buy for everything I want to try and never get around too

I know what you mean. One way to a higher profit is sticking with a set product line. The fun is in experimentation though. It's deciding where to draw the line fun vs profit. You can have both.

 

[LomondSoap]

Profit? No way near it! But I only started to sell in Aug 2008, so maybe this year if I can reign in my curiosity of having to try everything :roll:

 

[jcandleattic]

Profit? No way near it! But I only started to sell in Aug 2008, so maybe this year if I can reign in my curiosity of having to try everything :roll:

LOL Good luck with that! LOL
I don't know how long you have been soaping vs. selling, but I've been selling my soaps for a little over 3 years and I still have to try everything I see. Or at least buy the supplies to put it on my "some day" list and have the stuff sit around forever. LOL

 

[andreabadgley]

Nope, no profit in 2008, but I plan to profit in 2009! That's my goal, anyway I've only been selling since April 2008, and after crunching numbers in January (LOTS of numbers), I figured out that if I double my sales this year, I should be able to profit (fingers crossed!!). Since I did no marketing last year, I'm hoping my goal is realistic.

 

[andreabadgley]

One way to a higher profit is sticking with a set product line. The fun is in experimentation though. It's deciding where to draw the line fun vs profit. You can have both.

I agree! I get both fun and (eventually?) profit by offering both a permanent product line and seasonal product lines. Then I can play around with seasonal stuff, experimenting and offering fresh products that folks can't get year-round.

 

[beachgurl]

I'm a finance major .. so I know a bit .. not very experienced... one of the main reasons that small businesses fail is because they don't completely understand their costs. When you sell a bar of soap you should know exactly how much the shea butter in that bar cost, how much the colorant cost, down to how much ink you used for the label, etc. Those little iddy biddy costs can obliterate your net profits.

 

[andreabadgley]

I'm a finance major .. so I know a bit .. not very experienced... one of the main reasons that small businesses fail is because they don't completely understand their costs. When you sell a bar of soap you should know exactly how much the shea butter in that bar cost, how much the colorant cost, down to how much ink you used for the label, etc. Those little iddy biddy costs can obliterate your net profits.

No kidding! When I first started out, I set prices based solely on cost of ingredients. I was pretty proud of myself for figuring out exactly how much each bar of soap cost me to make, at least in terms of ingredients. I did not, however, figure in labor or packaging. And as my business grew, I bought insurance, pay web fees, credit card processing fees, etc. etc. Now I have all these extra costs that aren't really incorporated into my prices. Luckily, I have a friend who sells the soap on consignment for me, and her fee is 30%, so I did set all prices with that fee in mind. It ended up giving me a buffer when I started accumulating more expenses besides just the ingredients

 

[rszuba]

ya, i was wondering how do ya figure out how much the ink on your label is?

 

[kaseencook]

Not much profit for me either, but still new.

Although we don't have much money in general, as my husband and I have degrees in fields that are hard to find jobs in :roll: , but this keeps me from going out to the store or ordering things online unless they are absolutely needed. I pine to be able to get more materials and have a large stock. The saying "it takes money to make money" always comes to mind though.......

I also went to a free gov funded small business one-on-one meeting with a business professional and he really emphasized keeping records of the cost of all materials, labor, and overhead, and pricing accordingly. Also about keeping and revising business and marketing plans, which I find really motivate me and get me back on track when I feel lost. Also about how you can claim the depreciation of your tools/computers/other related and lost stock on your taxes. The Aussie gov has a lot of free services for small bussinesses (including templates and small bussiness packets online) that can be found on the web. Anyway, getting off topic.....

So I feel good that I haven't spent as much as I could have, which means less to sell to make a profit... I feel bad anytime I buy something though.... like there goes the profit! :shock: he he he

 

[Lindy]

Inkjets usually cost about 14 cents per page so if you take that and divide up the number of labels you are printing you get will get a rough approximation of the ink costs.

 

[Guest]

profit

Realistically, does anyone really make a substantial living at doing this? I mean, short of someone like Carol's Daughter....

Soaping pays for my son's summer camp and the incidentals during the school year, but that's about it.

My profit was minimal, but the benefits in stress relief from my 9-5 gig and making my kid happy was priceless.

 

[Lindy]

I sure hope so as I am basing my future living on it. However I am going to be doing retail outlets every weekend as well as make the soap and stuff - so here's hoping that my business plan is sound.....