Cost Breakdown
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Genny
Well-Known Member
This is a good place to start
http://teachsoap.com/pricing-your-cp-soaps/
http://teachsoap.com/pricing-your-cp-soaps/
Wyldwytch Studios
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How I figure cost...
This is how I have always figured the cost of my products, someone might have an easier way, but this works for me...
I use grams for my weights
1lb = 454 grams
First I divide my shipping cost buy how many products or pounds of products I ordered to get an average of what I have to add into each product. So if I ordered 25lbs of product and shipping cost me $38.00 I come up with $1.52.
Shipping: $38.00 / 25lbs = 1.52 per pound
Now the 7 lbs of Olive Oil I ordered cost $17.50
$17.50 / 7 lbs = $2.50 per pound
Now you add your 2.50 pp to the $1.52 pp shipping.
$2.50 + $1.52 = $3.07
If I use a 1/2 lb of OO in a recipe it costs me $1.54 of OO.
You do this for all the stuff you use in the formulation.
Now after you do all this for what is in there. You divide your total by the amount sellable bars you get. So if a 2lb formulation nets me 12 sellable bars and it costs me $17.00 to make those 12 bars you come up with:
$17.00 / 12 = $1.42 per bar
Now you have to add in your packaging. If your packaging costs you $ .28:
$1.42 + $ .28 = $1.70
That is just to produce your bar of soap, this hasn't figured in your "pay", overhead or replacement product, which is why you usually mark the product at least 300% (first 100% covers money already expended, second 100% replaces materials to make new bars, third 100% is your overhead or pay). So using the minimalistic markup of 300%, you would have to sell your bar of soap for:
$1.70 * 3 = $5.10
Once you have all your pricing figured out for all your materials it really is quite easy to put it in an excel spreadsheet and have it calculate everything. Then all you have to do is change prices if there is an increase or decrease.
Hope this helps.
Rose
This is how I have always figured the cost of my products, someone might have an easier way, but this works for me...
I use grams for my weights
1lb = 454 grams
First I divide my shipping cost buy how many products or pounds of products I ordered to get an average of what I have to add into each product. So if I ordered 25lbs of product and shipping cost me $38.00 I come up with $1.52.
Shipping: $38.00 / 25lbs = 1.52 per pound
Now the 7 lbs of Olive Oil I ordered cost $17.50
$17.50 / 7 lbs = $2.50 per pound
Now you add your 2.50 pp to the $1.52 pp shipping.
$2.50 + $1.52 = $3.07
If I use a 1/2 lb of OO in a recipe it costs me $1.54 of OO.
You do this for all the stuff you use in the formulation.
Now after you do all this for what is in there. You divide your total by the amount sellable bars you get. So if a 2lb formulation nets me 12 sellable bars and it costs me $17.00 to make those 12 bars you come up with:
$17.00 / 12 = $1.42 per bar
Now you have to add in your packaging. If your packaging costs you $ .28:
$1.42 + $ .28 = $1.70
That is just to produce your bar of soap, this hasn't figured in your "pay", overhead or replacement product, which is why you usually mark the product at least 300% (first 100% covers money already expended, second 100% replaces materials to make new bars, third 100% is your overhead or pay). So using the minimalistic markup of 300%, you would have to sell your bar of soap for:
$1.70 * 3 = $5.10
Once you have all your pricing figured out for all your materials it really is quite easy to put it in an excel spreadsheet and have it calculate everything. Then all you have to do is change prices if there is an increase or decrease.
Hope this helps.
Rose
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This thread might help. Lots of info to read.
http://soapmakingforum.com/forum/viewto ... 68&start=0
http://soapmakingforum.com/forum/viewto ... 68&start=0
judymoody
Well-Known Member
There's a software program called soapmaker. You input all of your costs and it tells you your cost per bar. It has many other features. Google it and I think you can try it free for a month.
