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Tabitha

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Below is a post I have copied and pasted here and marked as a sticky. This comes up so often and Mandolyn was so point on when she wrote this a few months back. I am sure we will refer to this info often. All mods & admin support this well fomulated and insigntful post. Thanks Mandolyn!



"This is a generic thing I've been posting when people are considering selling soap. There's a lot to consider. I suggest soapmakers wait a year at least before selling. It's not meant to be discouraging or anything, but will hopefully give you an idea of all that selling entails.

What are your state & local regs on selling? You'll need a tax ID. Do city zoning laws forbid you from manufacturing in your home? Do you have liability insurance? Some venues require vendors to carry their own liability insurance. You should have it anyway to cover your own assets. Do you need to register as a business with your city, county and or state? Even if you're not required to, you should, in order to protect your personal assets in case of a law suit. Will manufacturing in your home make your homeowner's insurance null & void?

How long have you been making soap & B&B products, & how long have you been testing them? Do you know what your products are like a year down the road? Do you know what the shelf-life is of each of your products? Are you well-educated on INCI labelling & cosmetic regs? If someone's child has an allergic reaction to one of your products & the parents decide to file suit what will you do? Do you have insurance to cover that?

Do you have bookkeeping skills, & can you use accounting software? Will you do your own business taxes or can you afford to have someone else do your business taxes for you?

Consider your responsibility for your products. Consider how many people can come in contact with your products. Your responisibility grows exponentially. It's not just the person who purchased your, say soap. It's everyone who comes in contact with it - the person who purchased, their immediate family, friends of each family member, the extended family members who come to visit. Are you ready for that level of responsibility for what you create?

Many times I have had people buy soap & say it's too pretty to use. People will use your soap in their drawers as sachets, or leave them on the bathroom counter for month & months just to enjoy the scent. Sometimes they stash them away for months to give as gifts. The question then is, "What will your soap be like in 6 months or 8 months or a year? If you haven't waited it out, you don't know.

I purchased a competitor's soap at our local coop. In less than 6 months it smelled rancid, & I tossed it. That angered me:
1. I wasted my money
2. That handcrafted soap was a reflection on the entire handcrafted soapmaking community. Are her customers going to assume that all handcrafted soaps smell funky after a few months?!!

You need to know all the regs. What pushes your soap from soap into the "cosmetic" class & what does that mean as far as cosmetic regs? What pushes your lotion or cream into the drug arena, & what are the regs regarding that?

After you've gotten all that under your belt, what are your state & local regs on selling? You'll need a tax ID. Do city zoning laws forbid you from manufacturing in your home? You'll need liability insurance & that's NOT cheap! Will manufacturing in your make your homeowner's insurance null & void?

These are only a handfull of things to consider. You have a long learning curve ahead of you. You need to learn to formulate & test your formulas. That means researching each ingredient you plan to use - oils, butters, scenting materials (FO's, EO's), & research any additives you plan to use to avoid those that are known sensitisors, or outright harmful to use. While researching, you'll need to figure out which info is reliable & which isn't.

You'll need to learn when to use preservatives & which one you need for each type of product you make. Your lotions & creams should be tested to make sure the preservative you chose is really working.

Then, there's packaging & labelling. You'll need to learn the proper way to label your products using INCI nomenclature.

So, I don't mean to sound discouraging, & as you already know, there's a lot to consider before selling. I just like to put that out there for other new people to see & consider.

Lots of people rush into selling without having all their ducks in a row, or even caring to try to. I'm just passing along what I've learned & what other soapmakers shared with me in the beginning when I wanted to sell right away.

The added benefit of waiting a year is that when you sell, you'll feel confident talking to your customers about your products, & you'll have good sound info to give them based on all the research & testing you did through that year."
 

SudsyKat

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Tabitha,

This is an excellent post - very helpful. As a newbie, I want to thank you for these insights. :D
 

BakingNana

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Absolutely excellent post. Nebraska, where I live, has an excellent agency that outlines exactly what you need to do to establish a small business here and provides terrific support. As for the remainder of my post here (and I apologize for it's length) I'm speaking as someone who's only been in business since last January.

I made soap for family and friends for about a year and a half when it occurred to me that I was hopelessly addicted to soapmaking. I had requests for soaps, inquiries from stores, etc., just through word of mouth. The only real reason I decided to "go legit" was the simple fact that I was drowning in soap and had to find some way to support continuing to make it.

It was at this point I found this forum. I hesitantly posted a couple of things and some photos of one of my first batches to see what response I'd get. Responses were wonderfully positive and nurturing. So I began the really hard work. It took me a good six months of steady hard work to work through all the points in the original post above, even with the wonderful support provided by my state. And that was after I was comfortable with recipes, longevity, testing, etc. I work 12 to 14 hour days at this. It will take you longer than you think to research and comply with your state and federal requirements. My insurance requires me to comply with all FDA regs, so I MUST be familiar and comfortable with them. I started with a couple of local wholesale customers first to be sure I had ducks in a row business-wise before I even attempted retail. My retail website has only been functional for a couple of months, even though I've been "in business" since last January. And I'm just now starting my first spate of craft shows.

I firmly believe the old saying, DO NOT RUN BEFORE YOU CAN WALK! I'm not even aggressively marketing yet. I'm taking things slowly. Producing a top-quality product is my emphasis; NOT making money. IMHO, if you need money go work for someone else; i.e.; get a "real job." Make soap, bath and body products, etc., because it's your passion, not because you want to make money. I truly believe the old adage that the money will follow eventually if YOU follow your passion.

Here's my gripe....I get the feeling sometimes that more experienced people on this forum assume that if someone is asking a question at all, they should not be selling. Let me tell you...I make a **** good soap. But at the same time, I'm testing things all the time. I'd never market something until I was completely comfortable with it. I'm not going to get customers by selling an inferior product. My goat's milk soap is a good example. I made great goat's milk soap for sale using GM as 50% of the liquid. BUT...I wanted to market a soap that was 100% GM and was having trouble with caramelization bits. Irish Lass solved my problem. The posts may have seemed like a newbie soapmaker who didn't know how to make goat's milk and should not be selling goat's milk....but that IS NOT THE CASE. I'm hoping the recent posts literally attacking people asking questions were well researched and well founded, but I'm feeling a little hesitant to ask questions now. The next thing I'll be working on is a soap formulation without coconut oil; if I have questions during my testing, will I be attacked? Now, if I were asking questions about it while at the same time marketing it on my website, I'd DESERVE to be attacked! In fact, if you see a 100% OO castile marketed on my site, you have my permission to bust me. I can't make one that doesn't DOS after about 6 months so far.

Sorry for the rant.
 

carebear

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It's never that someone asks questions that makes us wonder if they should be selling soap. It's typically something like the post the previous month stating that they just made their first bath that clues us in.... Or a pattern of questions about the very basics of soaping (like "how do I make soap")...
 

Tabitha

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Right, it is a post in January "I just made my 1st batch" followed by a post in Feb "I just sold my soap to a little shop" followed by a "what does rancid soap look like" or "how long does it take soap to cure?"

If you have already sold your soap to a shop it's too damned late to ask what does rancid look like or how long does it take to cure & a dozen other obviously newbie questions.

If they are going to do it, they are going to do it, but I will not have it posted on this forum like a billboard for every other newbie to read & say "they sold their soap after 1 month, guess that is a good idea, think I will too."

We are all still learning, we never stop.
 

BakingNana

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Tabitha said:
Right, it is a post in January "I just made my 1st batch" followed by a post in Feb "I just sold my soap to a little shop" followed by a "what does rancid soap look like" or "how long does it take soap to cure?"

If you have already sold your soap to a shop it's too damned late to ask what does rancid look like or how long does it take to cure & a dozen other obviously newbie questions.

If they are going to do it, they are going to do it, but I will not have it posted on this forum like a billboard for every other newbie to read & say "they sold their soap after 1 month, guess that is a good idea, think I will too."

We are all still learning, we never stop.
Right on! Thanks for clarifying a little. I haven't traced a thread like the example above. Probably a good thing; It'd just add to my stomach acid.
 

Tabitha

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Nana, What you 'see' on the forum is usualy only the tip of the iceburg. There are usually PMs and emails that have transpired prior to a public lashing so to speak. We tend to do our research first as well, checking out IP addresses, blogs, etc attached to the person in question.
 

tlaborn

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Where Can I start to find liablity insurance for my Bath and Body business?
 

heartandsoap

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this is a great post! Thanks for making it a sticky. I think a lot of us love making soap so much we wonder about the prospect of making a business or part time venture out of it. I started making soap again last year after taking a break from it. I'm flirting with the idea of making it as a part time venture but the admin costs are adding up. Liability insurance alone was quoted at $1000. I've figured out so far between permits, applications etc.... it would cost me $150-200/month in admin costs. I still have to purchase supplies, make it, cut it, cure it, package it, sell it, mail it, do accounting, manage a website...and there's still costs of tables at fairs, paying a helper that I haven't factored in because I don't know what they'd be. The big Christmas Craft fair in my area is $500 for a table. That adds up to a lot of soap before you make any money from it.
It all starts to add up quickly.

Am still on the fence about doing it as a business. Will wait and see, there is no rush.

I still love making it. So in the meanwhile I'm just going to keep experimenting and having fun. Buying small amounts of beautiful ingredients and making quality soap. If I do sell soap I want it to be great soap.
 

AmyW

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Is it bad taste to add to my sig a link to this post? It's amazing how many people that are making and selling soap and know less than I do, and I've been making it less than a month. It worries me that bad soaps out there will give everyone's soap, professional and hobby, a bad name.
 

foresthome

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Great thread

This is a great thread very educational. I have been making soap for about 5 months and I am just starting to consider selling some of it, at local crafts fairs, mostly to help pay for supplies to make more soap. It is a great creative hobby, I am so glad I found it. I have had a failed batch, and I am still dealing with partial gel issues, so I can't imagine someone with less experience than me selling their soap already. Keep the great info coming, my sister (and brother) soapmakers.
 

nicholas

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I'm interested in some soap business stories. How realistic is it to start a soap business as a side business? Heartandsoap suggested a $1200 cost a month. I looked on HSG Inc, they gave a $500 quote. But even than $700 a month for someone looking to make a little extra money from something they like doing?

To me it seems like a dive in head first kind of deal or don't go swimming at all. Anyone mind sharing their story?
 

dagmar88

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nicholas said:
I'm interested in some soap business stories. How realistic is it to start a soap business as a side business? Heartandsoap suggested a $1200 cost a month. I looked on HSG Inc, they gave a $500 quote. But even than $700 a month for someone looking to make a little extra money from something they like doing?

To me it seems like a dive in head first kind of deal or don't go swimming at all. Anyone mind sharing their story?
No problem. I've got about 40.000 hours put in my business so far.
My products will be soap bath & body and 'scented home' products and it will all be on a relatively small scale.
Making those (product development, testing) is fun, what comes next not so much.
Paper work; business plan, marketing plan, tax classes, small business owner classes, endless sheets of calculations, purchase and sales numbers and making sure you can meet up to all legal standards...
Been working on my business since late 2008 and will need at last till late 2011 to start.
Since things can't be done half way, I'm working on getting financing for around €35.000.
That includes rent, development of the location and my production lab, staff/accountant/plummer, thorough testing, buying materials and so on.

I'm ensured of a minimal income for the first 5 years.
I'm 'disabled' and therefore I'm taken into consideration for financing by the authority who hands out my disability check; they kind off buy me off for creating my own job; wouldn't be able to start my business otherwise.
Just saying, you need back up, allways.
I still don't expect to make any profit for the first 3 years...

So, considering what I have to put in both time and money wise to start a job I'll have to put in 80 hours a week and the years it will take before I'll be able to live off that... I'd say you have to be very passionate about it and at least a little bit nuts.

When you're just looking for a little bit of extra money... well... good luck! :lol:
 

thebathsociety

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Does anyone have links for the federal and state regulation guides? I am currently in Maryland. I didn't realize how much work I'd have to put in to make sure my product is safe before I sell, but I want to do this the right way. I am not selling soaps or lotions - I am specifically going into bath items like bombs and salts, with targeted benefits.

(Too many people on Etsy don't list their ingredients properly, and I'm sure most of them do not pay taxes.)

Please tell me if I am also missing a step here:

Other than knowing my ingredients and testing my products (which I don't mind doing, that's given), I need to:

- Meet FDA guidelines for cosmetics
- Does this include an inspection of my apartment?
- Meet state and federal guidelines for businesses
- I know how to file a Schedule C with my taxes, do I need to register my business?
- Get product liability insurance
 

Dee38753

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I'm new to the board and not nearly ready to begin any selling of my products...not even sure I will...but this is really an informative post and gives you some really great food for thought.
 

maxxx39

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I've been making soap for about 6 months now. I sell bits and pieces to family and friends. I started with melt and pour which I still rely on for now,tried hand milling once will try again eventually, and once I get all the supplies in place am headed towards cold process.

I do want to make a part time business out of it so I am taking small steps towards it such as earning enough to incorporate and obtain insurance(knock on wood)and getting labels and business cards made up.
 

Buttsmom

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Tabitha said:
I purchased a competitor's soap at our local coop. In less than 6 months it smelled rancid, & I tossed it.
Since I'm new to soap making I'm reading everything and anything I can. Since reading this I have been wondering what makes a soap smell rancid or go bad?
 

Genny

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Buttsmom said:
Since I'm new to soap making I'm reading everything and anything I can. Since reading this I have been wondering what makes a soap smell rancid or go bad?
Using rancid oils can make soap rancid, moisture/humidity being allowed to accumulate on the soap while curing can cause rancidity, excess of food additives in soap can cause mold and rancidity.
 

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