Chances are, you love making handmade soap. Cool. But can you make money selling handmade soap online? Yes. And the best part is, you get to do something you enjoy.
While I’m personally not a ‘soap maker’ myself, I can see this being a fun and profitable business for the right person. In order to take it from ‘fun to profit’ though, you need to do more than just sell your homemade soap at a farmers market!
In this article, we explore the world of homemade soap selling to help you get started.
Starting a Homemade Soap Business
As with any home business, there’s a process to follow if you want to turn a consistent profit. Here are the basics of getting started with your very own soap selling business.
1) Choose Your Soap Recipes
The first thing you need to do is figure out what kind of soap you want to make.
You may already have some soap recipes in mind or have experience in making different types of soap already. If not, that’s fine. This is the fun part!
The best way to come up with initial ideas is to consider what you personally like, and what the people you know like. If you love homemade soap, then you already have some insight into to work with.
From there, you could visit local soap specialty stores and see what interests you, or check out the local markets to come up with even more ideas. You could also spend some time researching to find out what is selling the best online and offline.
What common traits are there with the best selling soaps? Not only in terms of the different flavours either. Think about their different uses, scents, themes, textures and how some people prefer Vegan or organic soaps and so on.
Given the sheer number of options, you could spend a lot of time doing this. Try not to over analyse things though!
You need to start somewhere right? So, decide on a range of soaps you’re happy with and get started. You can always change or modify what you sell later based on customer feedback and the actual numbers.
2) Making Your Soap From Scratch
Once you’ve got an idea of the type of soap you want to make, the next step is to actually make it. This naturally includes buying the needed tools and equipment to get the job done.
I’m not a ‘soaper’ myself, but I did find a helpful soap making tutorial to help you get started. This shows you how to get rolling in a simple and cost effective way. All you need are some basic household items such as a mixing bowl, pots, spoon, mixer etc. You may need to splash out on a soap mold (similar to a bread mold) and a digital scale but nothing too fancy.
You will need to do more research and purchase more advanced tools if you intend on producing more unique soaps, but this is enough to get you started.
As you grow your customer base and gain more confidence in your soap making skills, you can scale up with better gear.
3) Presenting Your Creations
Let’s face it, people don’t buy this kind of soap just to get clean!
This is more of an art form than anything, and people love the uniqueness of these products. As in, the scent, ingredients, texture and appearance.
In person, people can experience all of this. On the internet, they can only see the soap.
This is why presenting your creative work properly can actually make or break your business. If you plan on selling online, you absolutely need to take high resolution photos and consider packaging the soap nicely.
You really want to showcase what you’ve made in the best way possible.
Take your time with this. Have fun. Get creative!
That being said, you could probably just use your phone camera depending on what you have. Apart from this it’s the lighting, and the setting that can make all the difference.
As you can see from the picture above, they really set the ‘theme’ for this soap which makes it very visually appealing. I’m personally not even into this stuff and I like this photo!
In any case, you will be competing against people who will be doing this so it’s well worth taking the time to present your products in the best and most unique way possible.
To come up with ideas, check out stock photo sites or social media sites like Pinterest or Instagram among others. There’s plenty of inspiration out there.
4) Pricing Your Soap
Up until now, we’ve focussed on the more creative and fun aspects of the business.
Now it’s time to put your finance cap on. As an entrepreneur, you will be wearing many hats so get used to switching between them when needed!
Anyways, what you need to do is work out a price that achieves your income goals and one that is attractive to your ideal customer. One mistake many beginners make is they sell their products cheaper than everyone else. This is not always the smart approach.
Soap is already sold for rock bottom prices per bar. Depending on where you buy, it’s often $5-$10 per bar. There’s only so much you can lower an already low price point before you wind up making nothing for all of your hard work!
So, you want to price your soap competitively, but at the same time you need to make a profit. Pricing comes down to many factors such as the soap itself, it’s perceived value, where you sell it, and your competition among other things.
But you’re just staring out, so let’s keep it simple.
A good starting point is to figure out what your production costs are. Once you know how much it costs you to produce your soap, you’ll be much better able to set prices.
Here a couple of examples to show you what I mean…
Example 1: You buy $50 of raw material which allows you to produce a batch of 40 bars of soap. This makes the ‘per bar cost’ $1.25. Factor in your day to day running costs and marketing expenses, and anything above this is profit. This essentially becomes the minimum price you can sell for to break even.
That’s pretty simple. But to make sure you are earning at least a reasonable hourly rate, you should factor your time into the equation too.
Example 2: If it takes you 6 hours to produce 40 soap bars, then (using round numbers) you can produce 7 bars per hour (40 bars divided by 6 hours). If your time is worth at least $30 per hour then, on average, the cost to produce 7 bars of soap is $38.75 ($8.75 for raw material and $30 for your time). Therefore, you will need to sell each bar for at least $5.50 each ($38.75 divided by 7 bars) to be happy. This is without factoring in day to day running expenses, initial setup costs or marketing.
These are just example figures so you will need to do your own research.
From what I’ve seen though, this doesn’t appear to be a super lucrative. But you are doing something you enjoy, and there is potential to increase your income depending on how savvy you are. For example, as your business grows you can invest in better equipment that allows you to double your output, and purchase raw material in bulk to reduce your costs.
Once you have an idea on your costs, spend some time researching your competitors to see what they charge. Think about what makes your soaps unique and why people would pay more or less for them. Depending on where you sell, it will be difficult to ask for more money than your competitors if they are offering more value and have a better reputation.
Take these things into consideration and you’ll be off to a good start.
5) Decide Where To Sell Your Soap Online
There are many options as to where you can go about selling your soapy creations.
Etsy is a great place to sell all kinds of creative and craft based products, including soap.
The upside is you can immediately tap into a targeted source of buyers and the costs are very low. The downside is you are competing against established sellers with a reputation and good reviews.
A similar platform is called Amazon Handmade, which is designed specifically to help artisans sell their wares to the right buyers.
Either one of these are potentially great places to sell. If you have enough patience to put in the needed effort and build your reputation as a great seller, you can make it work.
But don’t limit yourself either. There are many websites that allow you to sell your products online and different ways you can go about it.
For example, you could sell soap to hotels, resorts, health retreats or boutique stores. All you need is a simple website showcasing your products. This looks much more professional than showing business people an Etsy store when they are evaluating your products.
An simple way to get them to your website is to call them. Ask if you can send them an email about what you have to offer. You’ll no doubt get a few knock backs but you’ll also have people say yes. After all, it’s just an email! Within that email, refer them to your website where they’ll love what they find since you took awesome photos and make great soap.
You only need a handful of these clients to create a steady recurring income.
Can You Make Real Money Selling Soap Online?
How much money you will make depends on a number of factors.
Firstly, repeat business will be slow at best given that each bar lasts about a month or so. Second, the profit on each bar is very low. This means you need many new customers coming in and you need to be selling a lot of product.
There are ways to offset this though. I mentioned attracting business customers, but you can also sell ‘gift packs’ with assorted soaps to increase the volume of products you sell.
Who doesn’t love a gift basket right? No doubt, this sort of thing would make for a great Birthday, Christmas, Anniversary gift idea.
Another idea is to sell a range of related products that you know your customers will love such as lotions, essential oils and body creams etc.
Like any business, your success depends on you. How passionate you are, how much effort you put in and how consistent you are with your efforts. It could be a small time gig that makes you a few bucks here and there, or potentially much more than this.
In any case, this is more for someone who’s passionate about handcrafted soap than someone looking to cash in.
Soap Selling Regulations
You can have the best ideas and products in the world, but you need to know how to sell soap legally if you want to have a lasting business.
Turns out there are some FDA regulations on handmade soap that you should be aware of. Depending on how the soap is made and it’s intended use, it can actually be classified as a cosmetic or a drug.
As boring and annoying as this aspect of your business is, it’s super important. Take the time to do your research on this carefully. The last thing you want to do is destroy your business on a technicality, so it pays to know and operate within the relevant laws.
This could be fun and potentially lucrative business over time. By doing your homework and coming up with a realistic plan, you can easily begin selling homemade soap on sites like Etsy or Amazon with very little risk.
By starting small and scaling up as your customer base grows, you can progressively increase your profit margins through lower material costs (bulk buys) and better equipment to increase your output. In time, your reputation as a seller will also increase which allows you to raise your prices and increase your overall profits.
Either way, I think selling homemade soap could be a cool business for the right person.