Can someone give me suggestions on placing a price on my candle?

[Nicholas]

Greetings to all!

This is my first post on this site, I'm happy that I have found you all. It seem that there is a ton of info here. Wish I would have found you all many many months ago when I was alone testing and scratching my head..lol :tiptoe:

Just wondering if you all can give me some advice on putting a price on my candle. My starter candle (pic attached) will be a 16 oz candle. Any suggestion? Whats considered to low or to high? My candles will be 100% soy. My candles will have a main front label and on the back I will have a fun fact about that scent.

Thanks a bunch! Oh and I welcome positive or negative:smiley2:

[/ATTACH] comments.

[LadyJo]

Hi Nicholas. Welcome to the board.

You need to add up every dime you spent making that candle.. jar, lid, wax, FO, dye, shipping, etc. Then the general rule is to multiply that number by 3 to get a retail price. That won't be the 'set in stone' price but it will get you in the ballpark of what you should be charging for your candles. You may have to adjust up or down as needed.

[001]

I like them, One thing I will note is that 100% soy is sort of a misnomer, there are things in a candle that are not soy (fragrance oil for instance) but that is minor. The "rule" is 3-4 times cost. It used to be 4x but 3x generally gives you enough wiggle room and puts you in line with the industry. When I sell 16 ounce apothecary jars I sell them for 16.99. It will depend on your market though, some people sell them for around $12.

[SliverOfWax]

Very nice candles and innovative labels.

Seriously, only you can decide what your candle will sell for. There is truth to the notion that if priced too low, people will think there's something wrong with them. Wholesale or retail? Flea market or upscale boutique? Too many variables.

[deb426]

Just wanted to say I love the "Fun Fact" thing on your label! And what everybody else said about pricing.

[Nicholas]

LadyJo,

Thanks for your warm welcome & thanks for your advice!

[Nicholas]

Enigma,

Greetings! Thanks for your advice..I'm wondering if I should change 100% Soy Candle to 100% Soy Wax? Also, I see that I don't have a weight on my label, this I will need to adjust. Have you had any problems with placing the 16.99 price on your candles?

[Nicholas]

Silverofwax,

Greetings & Thanks for your compliment! I think that I will do some calculations and maybe meet in the middle. I still have a good month and half before I get me website up. So, this will allow sometime to think some more lol

[Nicholas]

Deb426,

Thanks for your compliment!

[AlwaysWondering]

I find that going to etsy.com is always a good way to take a measure of the competition and what they are charging as well as seeing trends develop, etc. I find that regardless of wax product, container candle, scallop tarts, clamshells, etc, the going rate is about $1 per ounce and often a tad less for container candles. There is another loose rule about pricing at three times your cost. Remember, cost is all raw and disposable materials including dye, labels, ink, packing materials, boxes plus your wax, wicks, dye, container. and what all the shipping costs are for the supplies to reach you. In the beginning, I think it is easier to check out etsy!

[NaturallyTru]

I love the labels! I want to know what the Christmas Hearth fun fact is.

[Kitn]

Hi welcome to the forum. Your candles look great.

[Nicholas]

Always wondering,

Thank you so much for your advice. I will check out etsy to get some comparable ideas.

[Nicholas]

NaturallyTru,

Glad that you like the labels.Here is the quote which I used on the Christmas Hearth. I plan on having several different fun facts for each scent and rotate the fun facts.

According to the Dutch tradition, children left out nourishment for both "Sinterclass" (Santa Claus) and his steeds. In those days, Sinterclass' animals were sometimes regarded as donkeys and sometimes as reindeer. Originally, children left the animals straw in their wooden shoes (clogs), but eventually left straw in stockings. They left these treats by or on the fireplace hearth. After Sinterclass and his animals consumed the edibles, Sinterclass filled the shoes or stockings with gifts.

[blacktieaffair]

My "profit" has suffered , just like everyone elses because my wax is now $1.48 a pound. Thankfully I haven't had hardly any of the oils go up enough to worry about, but I've noticed that ink has went up for me. Along with clamshell prices from candle suppliers. ( I WILL be getting them from that website yall recommended the other day ). My florals for my TPs and PTRs have luckily stayed the same for the past two years and I ONLY buy them when they are on 1/2 off.

The point of my post is........ if I did the actual COST of one pack of melts including the wax/fo/clamshell/label/ink/.. and did it 3 times over for retail, I wouldn't be in line with everyone else. So, I have to watch wax go up and my profit margin slide in the other direction.

Now, having said that, I have had some of the big "small guys" tell me to even factor in / guesstimate an hourly salary and electricity it takes to make the product. Me, for now, thats just hazards of the trade so I dont count them in. Maybe one day I'll be as big as they are and can do that LOL.

[LadyJo]

Now, having said that, I have had some of the big "small guys" tell me to even factor in / guesstimate an hourly salary and electricity it takes to make the product. Me, for now, thats just hazards of the trade so I dont count them in. Maybe one day I'll be as big as they are and can do that LOL.

The "multiply by 3" breakdown is --- material cost, overhead, and profit --- . The electricity and your labor would fall into the "overhead" part of the equation so it's already factored in. Granted it never truly covers our labor but it gets a bit of it in there. LOL

[Stella1952]

The tough part about pricing at first is chances are you are buying in smaller quantities which means you are paying top dollar for your materials. It's essential for a business to factor in labor to the costs, but one has to be reasonable about that, too, because chances are you don't have your production line streamlined for maximum efficiency either.

You should know exactly how much you have in materials (including shipping costs) to the penny and your production costs (how much time it took to wick, pour, label, etc. each candle, an estimate of the utilities used) as well as general business overhead like telephone, computer, printer and related office supplies.

The advice on tripling that figure for retail is standard, but realize that that will put you on the high side. That's when you take a look around your town or wherever you plan to sell your candles and see what the market is bearing in your neck of the woods. Ask the advice of friends, family & coworkers. Check high end shops, spas, salons as well as your local flea markets and corner convenience store. Check online prices. Many people have one cost for online sales and another for local sales. If you plan to sell locally, be sure to include the costs for transporting the candles from your place to wherever you sell, any booth rent, etc. Because setup costs (materials, equipment, etc.) all are part of the cost of a business, understand that some are amortized over time, such as the cost of durable equipment like melters, scales, etc. You may have to accept a lower profit percentage at first because of your higher materials costs until you can purchase in high enough quantities to lower your costs.

Now this is one heckuva lot of overhead, but then when you know the TRUTH about every dime of money and time you are spending, THEN you can see how and where you need to reduce costs so you can turn a profit.

Most home crafting businesses fail because people do not count EVERYTHING involved with their business, so keep good records, get a bookkeeping system set up, consult an accountant and/or attorney regarding business issues, such as the type of business entity you want to set up (a sole proprietorship, partnership, LLC, S-corporation - each has advantages and disadvantages), whether you will be setting up your books using the cash or accrual method, etc. You will need an EIN (federal tax identification number), a state and local sales tax number and whatever local business licenses you need. You will need product liability insurance, general business liability if selling from a booth or a brick & mortar location and assurance that if you are making candles in your home that that activity will not interfere with your homeowner's insurance (some policies will not pay if the home is damaged due to a business activity or even specifically candlemaking). Know whether your home is located in an area where you are allowed to conduct business (local zoning laws, subdivision & homeowner's association rules, etc.). Go to the IRS website and READ the material there concerning the IRS rules for a craft business and a hobby. You will not be allowed to write off your expenses if you do not turn a profit in 3 of the last 5 years including the current tax year. If you plan to sell online at eBay, etc., it would be a good idea to review the information at this link.

It sounds easy to just make some candles and put a price on them, but you are engaging in a business activity and there's a lot more to that than people realize which is why so few stay in business. Getting good local professional business advice FIRST while you are still in the set-up phase is very important to your future success. Good luck! :-)

Edited December 17, 2011 by Stella1952

[Candybee]

Nice candles and labels. If it helps I currently price my 16 oz candles at $13 but that is because they won't sell in this area for $15-16 like I need to price them. So besides doing a spreadsheet on candle costs you also need to scout out your local competition and area prices for candles.

I know exactly to the penny what it costs me to produce a candle but in my area the competition will outsell me if I don't price them just right.

Once the economy gets better and people have money to spend again then I will reprice my candles to reflect that.

Another thing to think about is the size of your candles. In my area my 16 oz candles are nowhere near my bread and butter products. Smaller candles are what sell and I only make 16 oz for those that like larger candles. But I only make about 2 of each scent I have and restock as needed. My smaller 9 oz jars far outsell the larger 16 oz candles.

[Nicholas]

Candy bee, thanks for your advice. I plan on doing some research in my area and compare my candles with other companies. Thanks a bunch once again!