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Keeping Secret Formula Secret


tangerine

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Preface: I don't have employees, but have thought about this.

If I were large enough to have employees, I'd get one of those giant wax melters and pre-mix the unscented wax in there. My employees would only know the FO and color amounts to add. Depending on sales, it's also possible to buy a bunch of smaller melters and premix the wax and color and leave the scent for the employees to do.

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Preface: I don't have employees, but have thought about this.

If I were large enough to have employees, I'd get one of those giant wax melters and pre-mix the unscented wax in there. My employees would only know the FO and color amounts to add. Depending on sales, it's also possible to buy a bunch of smaller melters and premix the wax and color and leave the scent for the employees to do.

I was thinking along those lines but I wanted to keep even more of it secret. :D I considered weighing the amount of FO needed for each batch into separate bottles. But then if they really wanted to find out the amount of FO, who's to stop them from taring an empty bottle and weighing the FO?

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If you are seriously concerned about keeping it a secret, then have them sign a no compete contract with you, which prevents them legally from starting a business of their own based on the knowledge they received while working for you. Big businesses do something similar to prevent account managers from taking clients with them, etc. Check into doing it legally, and not adding more work for yourself.

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I agree with Deb. First of all - if you have to run around hiding stuff and making stuff in stages so they don't see - what is the point in having someone help? If that is the case bring them in to do specific things. I opted for having an apprentice - first was my son and I paid him to work with me, now I have a young lady, she is 14 and has worked with me for over year. They only learned what they could handle at their ages, now my son pours along side me and the young lady wicks, packages, cleans jars, cleans the shop, clips wicks and helps do inventory. If you hire help to do stuff like that and maybe fill the containers after you mix them up then it might work, but if you orient them to the whole routine and then you have to jump in and do something that is secret - kinda mute to having help? Besides, like Deb says once your profits are so high you need to hire help, you can pay to have a lawyer draw up a Non Compete clause in their working contract. But trust me - they are only a deterent, many non competes don't hold up in court if they are too restrictive and most are easily overturned if the employee is willing to relocate and not actively seek previous clients.

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A Non-Compitition Agreement.. Here is a sample of something that may help.

EMPLOYEE NON-COMPETE AGREEMENT

For good consideration and as an inducement for_________________ (Company) to employ _________________________ (Employee), the undersigned Employee hereby agrees not to directly or indirectly compete with the business of the Company and its successors and assigns during the period of employment and for a period of _____ years following termination of employment and notwithstanding the cause or reason for termination.

The term "not compete" as used herein shall mean that the Employee shall not own, manage, operate, consult or be employed in a business substantially similar to, or competitive with, the present business of the Company or such other business activity in which the Company may substantially engage during the term of employment.

The Employee acknowledges that the Company shall or may in reliance of this agreement provide Employee access to trade secrets, customers and other confidential data and good will. Employee agrees to retain said information as confidential and not to use said information on his or her own behalf or disclose same to any third party.

This non-compete agreement shall extend only for a radius of ________ miles from the present location of the Company and shall be in full force and effect for ________ years, commencing with the date of employment termination.

This agreement shall be binding upon and inure to the benefit of the parties, their successors, assigns, and personal representatives.

Signed this _____ day of ________________________ 20____.

_______________________________________

Company

_______________________________________

Employee

Here is the page this is from:

http://www.ilrg.com/forms/nocompet.html

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Interesting stuff.

Tangerine, who are your employees? Are they family/friends? Is this an issue of not trusting them (period)? Having family/friends as employees can open a whole new can of worms.

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I was thinking along those lines but I wanted to keep even more of it secret. :D I considered weighing the amount of FO needed for each batch into separate bottles. But then if they really wanted to find out the amount of FO, who's to stop them from taring an empty bottle and weighing the FO?

Maybe it's just me, but I can't see the need for keeping the amount of FO a secret. Unless you have some super duper secret ingredients, it'll be much more trouble than it's worth. The amount of it you CAN add is a small range and that can be found anywhere online. The exact amount you use personally is not necessarily the same as what will work best for others. Especially if they use a different wax... even the same wax from different batches can act differently. That's why we test so much and tell everyone to test for themselves. I could give you my EXACT formula and you may not be satisfied with the way it turns out because it probably wouldn't come out the same.

The contract is probably the best way to go if you think it's really necessary. Your exact methods, timing, temps, etc are as important as the formula.

JMO

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I have thought about this also. I want to keep my suppliers and such a secret not the actual process as, well, lets face it...it isnt rocket science.

So, I call on my candle making buddies to help me. They already have their own suppliers so I am not worried about keeping mine secret!

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Interesting stuff.

Tangerine, who are your employees? Are they family/friends? Is this an issue of not trusting them (period)? Having family/friends as employees can open a whole new can of worms.

They are not family/friends :)

SatinDucky, I see your point with the FO. I guess in the long run, even with contracts and all, they can run away with my formula only to find that it doesn't work for them.

THANK YOU for all the ideas, everyone!

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I have a helper that has made managing my little candle business much more fun, we work so well together.

He measures, mixes, pours, I don't think he gives a rats behind about starting his own candle anything. Because he has worked right beside me for so long now, he sees the expense involved in testing, purchasing in bulk, all the way to finished, and loaded. If anything, he does not care to see any candle product after I get done with him some days. He is as proud of what we get done in a day as I am, I am the lucky one.

I don't worry about it, I understand why you might, I have had 2 old friends try candles, they did not do it for long.

but, can't you just tell when someone is overly interested in what you do that might make you suspicious? I get that a lot a shows, just questions out of left field.

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We make everyone sign a non-compete...especially relatives (now) I hired a relative, well, let's just say I never had her sign one, just kind of forgot at the time. Well, I ended up firing her(for numerous reasons). She mentioned to another employee that she was going to the other candle place in town and tell her how we make candles...course I about laughed my a$$ off! I don't think a candle co thats been in business 30 yrs needs to know how to make candles:laugh2:. She also said she was going to make candles now...I laugh now at it as when we have slow weeks I say to DH that it must be her taking all of my customers...:laugh2:

It is very important to have a non-discloure. I made my own and its pretty generic, but can hold up in court if needed be...but since I'm 95% wholesale, it's not really much of an issue in loosing cutomers. However I have had 2 customers completely steal my product lines!!!!!

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