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How to Start a Soap Making Business – A Step-by-Step Guide

how to start a soap making business
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If you’ve been thinking about how to start a soap making business, then you’re in the right place.

The DIY market was worth $819.53 billion in 2018. It is estimated that it will grow to $1137.57 billion by 2025 (Source: Comfy Living).   And it’s likely that you’re here because you’ve either been experimenting with soap making as a hobby or you’ve come across the idea, but you want to know:

  • Whether it’s a profitable business model
  • What is the cost to start a soap making business
  • What equipment is needed
  • And how to advertise and sell your products

Is the Soap Making Business Profitable?

According to Shopify, homemade products that seem to be drawing the most attention and money are soaps and bath bombs, which are followed by printed T-shirts (and other printed goods), jewelry, subscription boxes, and custom-made gifts as well as candles.

Added to that, profit is an equation …

Income – Expenses = Profit

In order to run a profitable soap making business, you need to budget, and ensure that the expenses for your business are less than your income.

One of the benefits of owning a soap making business is that it can be run from home, so that helps with keeping start-up costs down. There are also 2 methods that you can choose from to make your soap, both are relatively inexpensive. I will get into more details about start-up costs later on.

A soap making business can be very profitable when you have a brand that stands out from the rest, when your business is marketed to the correct demographic, and when your sales exceeds the amount needed to run your business. 

What would it cost to Start a Soap Making Business?

Start-up costs can vary depending on how you would like to run your business . There are also 2 different methods for making soap which can also determine how quickly you start selling.

There’s the cold press method which involves lye and requires the soap to cure for 4-6 weeks before use. For more detailed instructions on how to make cold press soap I suggest you click here.

Then there’s the hot process method which requires no cure time. Follow the steps here to start making your own hot process soap. Both are popular methods and you will have to choose which is best for your business.

For an estimate on what it would cost to start a soap making business, we can calculate the need for things like:

  • Soap ingredients – $100 (these ingredients can vary greatly on the soap you are making – here is a list to get you started):
  • Coconut oil
  • Olive oil
  • Palm oil
  • Distilled water
  • Pure Lye
  • Essential oils
  • Colorants (mica)

Here are some suggested suppliers:

  • Advertising (even if it’s just hosting, a domain name ,and SEO training) – $300
  • At times, you may need a business permit – $50 (varies by state, check with your local government for requirements)

As you can see, soap making is quite inexpensive to start up with just the basics. You can spend around $500, and you’d want to be prepared to re-invest into the business until it becomes profitable.

Other expenses that are common with soap making businesses are:

  • Digital advertising
  • Photography
  • Soap molds
  • Paying for help
  • Branding and packaging
  • Bookkeeping
  • and More

How to Get Started with a Soap Making Business – Step-by-Step

If you’re ready to get started with your soap making business, here are some recommended steps to take:

1. Create a Business Plan

  • When do you want to launch? 
    • Setting your launch date helps with accountability. Set the date and get the ball rolling.
  • Who is your ideal customer?
    • This is incredibly important, remember there is a market for everything. You just have to make sure that you are targeting the correct market for your product. There is no right or wrong way to make your soap. It can be fun shapes and scents for kids, or high end organic ingredients. Design your ideal product and think about who you want to buy it. 
  • What type of soap will you sell? 
    • Will you make cold press or hot process? You have to take into account the cure time, especially when making seasonal/ holiday products to ensure they are ready. 
  • Will you sell other homemade products?
    • Bath salts, sugar scrubs, bath bombs, and more are popular products that go well with soap. There’s plenty of options to expand your product line down the road. 
  • How much will you charge?
    • The soap making business can be a highly saturated market. One of the biggest mistakes that new soap making business owners make is pricing based on other business’. If you price your product fairly based on ingredients/ time, and market to your desired customer then they will see and understand the value of your product. The jewelry industry is huge and you can get some amazing low end jewelry nowadays but there’s still people that want the real deal and are willing to pay for it. The same goes for any product or service. Don’t undersell yourself. 
  • What do you need to launch?
    • You can use our Business Planner to help you get clear about your goals and tasks you need to do to get your business going.
  • and More

Your business plan is very important when starting a business. It helps you set your goals that will guide your actions.

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2. Build a Website

A virtual storefront allows businesses to reach more customers than a traditional brick and mortar store, and people are shopping online more than they have ever before.

For less than $300 you can buy a domain and get hosting. These two assets are the foundation for starting a business website.

Recommendations:

3. Map your Customer Journey

When you over complicate things or make it hard for your customers, you make more work for yourself and lower your profits. 

I’ve learned that streamlining the customers journey helps not only with profits, but the overall customers experience as well

In the past, I’ve found myself on websites that have no categories or clear check out. It makes for a frustrating experience.

My customer mapping journey used to consist of making contact with a potential customer, and giving them something like a business card. I would hope they would follow up or reach out but I was left with no option to let them know of anything new with my business. 

Once I learned to streamline my customer mapping journey it started to look more like this…

Making contact with a potential customer and selling them to go to an opt-in page in exchange for a free and helpful gift (like a purchase discount or free beauty tip!), or to a sales page to make a purchase. 

Mapping helped me focus on targeting potential customers and encouraging them to go to my website where I could follow up because–that sales process works best for my business.

Your customer journey could look like this:

  1. Make contact with a potential customer (thru a blog post, online ad, or social media post)
  2. Spark their interest with a compelling free offer
  3. And, have them go to either an opt-in page for a free and helpful gift, or to a sales page to buy one of your soap goodies from you. 

Business shouldn’t be left to chance and by mapping out your customers’ journey, you are being intentional with your actions. Instead of relying on flyers or business cards to get customers to your website to check out your products. 

Your sales process may look more like…

  1. Internet ad 
  2. Opt in page
  3. Offer soap sample
  4. Sales Page
  5. Sale 

Customer journey mapping shows you how to get a complete stranger into a customer who trusts your products.

4. What Equipment is Needed?

Both hot and cold process soap require almost the same amount of equipment. Here is what you may need:

Tools to start making soap

  • Plastic or glass for measuring lye (if doing cold process)
  • Glass or metal containers for mixing (plastic is not recommended)
  • Scale
  • Stainless steel pot or slow cooker
  • Silicone spatulas
  • Immersion blender
  • Silicone loaf mold or whatever mold design you would like
  • Thermometer

5. Advertise and Sell  

When you start your soap making business you want to make sure that you spread the word. Thankfully, the internet has created new ways to build awareness of your brand. 

You can use Google and/or Facebook ads as a way to target people with certain interests and needs to learn about your business. Social media has become a great way for new businesses to get the word out about them. Even if you have a personal social media account, don’t forget to set up business accounts as well–this helps with credibility and building trust with your customers.

No matter how much people have turned to the online world for their shopping needs, we still can’t forget about offline. 

When you are thinking about offline sales, you want to approach them the same as you do online sales. Target the type of customers you want and that need your business.  

You may want to increase brand awareness by doing things like handing out business cards or samples at local spas, beauty parlors, or trade shows.

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6. How Do I Get Customers to Pay Me?

You’ll want to have your website set up so that it’s easy to checkout for your customers. Shopify is a great service that offers payment processing options for online and offline customers. Make sure to have a shopping cart software that embeds onto your website. Here are some recommended services:

6. Grow your Email List to Get More Clients!

If you are out, and meeting people who are interested in your products, make sure you get them on your email list. By giving something in exchange (such as a sample) for email addresses, you can build up an impressive client list quickly. When a new product is about to be launched, you’ll be able contact a list of buyers who have already shown an interest in your business. 

7. Make Money

Once you have a stand out product, have people aware about your business, and a website for them to shop at; then you’ll be making money.

Additional Resources to Start your Soap Making Business

Conclusion

Starting a soap business can be a very creative and inexpensive adventure to start. You can have a small product line to keep costs low in the beginning. When you have a brand that solves a problem, and when your business is marketed to the correct customers, you’ll be successful. 

Get started with our free business planner, and begin getting a clearer picture of your goals. If you have any questions, you can leave them in the comments section below.If you’re ready to get started with your business, I recommend you check out the Startup Entrepreneur’s Toolkit and learn how to master the process of getting consistent online sales.

Ready to Take the Next Step to Grow Your Business? If so, Start Here

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