Candle making can be more than a rewarding and fun hobby, it can be fun and financially rewarding as well. While it may seem like lots of people are starting candle businesses, the industry and demand are growing as well. Are you interested in seeing how profitable a candle making business might be for you? Let’s take a look.
Is a candle-making business profitable? A candle making business can be very profitable. Many candle makers see profit margins as high as 50% or more. The profitability of a candle business depends on the quality and price point of the candles that you are selling. The better the quality, the more you can charge.
The answer is found in the factors that help your candles sell better than others. These factors include advertising exposure, quality, and niche appeal. The rest of the profitability depends on your resources and skill at making candles. A quality candle starts with quality wax and additives in addition to understanding how these materials work.
Candle Business Costs
How much does it cost to start a candle-making business? You can start a candle making business for as little as a few hundred dollars. Starting a candle-making business involves buying equipment and supplies. You don’t need to buy top-of-the-line equipment as long as the wax you’re melting needs temperature-controlled equipment.
This is a list of all the essentials that you’ll need when starting up and reasons why you’ll need them.
The most essential part of your equipment includes wax melters and shouldn’t be the cheapest item you want to invest in. Waxes can be finicky when they are melting and need to have steady temperature control.
Too many DIY candle websites don’t tell you how dangerous wax melting can be. So your wax melter should be reliable and not something that could be haphazard. A good melter starts somewhere between $75-150.
Don’t assume that double boiler melters are a good idea. Introducing water vapor and steam into your wax or around your wax is a terrible idea. Always stick with temperature-controlled melting equipment with variable control settings.
A digital scale makes an excellent tool for estimating how much material and fragrance you’re using. More or less, you can use a digital scale to streamline the amount of wax poured into jars instead of eyeballing the pour level each time likewise.
Even when it comes down to adding dye and color to candles, a digital scale will give you accurate measurements.
These calculations are then added to your recipe booklet to recreate exact colors and scents each and every time. Digital scales cost as little as $5-10 depending on the number of kilos or pounds it can handle.
There are a wide variety of digital kitchen thermometers that can work for taking the temperature of your wax. These are used to get an accurate temperature immediately so you aren’t going above flashpoint levels.
There are also instances where wax should be an optimal temperature before it can be poured depending on the weather or the temperature in your room where you’re pouring. Digital thermometers cost between $10-20 each.
These items will all have varying price tags depending on the type of candle form or mold you’re using. They will range in prices depending on the materials used to pour the wax into.
High-temperature plastics and metal will be cheaper than silicone molds. Since silicone holds heat for longer, it can take longer for the wax to cool down rather than conventional pillar forms.
Consider these prices will range from $10-25 per mold or more.
These are colorants that are meant to color and tint your wax. Dyes are not exclusively made from liquid or powder and come available in pellet form also.
Only use dye and pigment that is recommended for adding to wax. Since wax also burns, synthetic additives in certain dyes can be toxic to burn.
The price range starts around $2-3 for 100 grams of dye and becomes cheaper when you buy select colors in bulk.
Buying a starter kit will be a better buy if it includes a wide range of colors you can work with from the beginning.
The fragrance is a delicate issue for candles since many of these can only be used for certain types of waxes. Some of these fragrances can also leech out of wax materials if they aren’t meant for certain wax blends.
Naturally, fragrances will be more expensive than colorants and dyes, so a small bottle of fragrance can start off costing $3-5. Once you learn which fragrance is best for the wax you’re working with, so buy these fragrances in bulk instead.
Wicks all come in different thicknesses and can also be purchased as presoaked wicks and pre-cut lengths. To get the most from wick material, it should be a continuous string that is cut to the desired length you need.
This way, the cost is reduced and you aren’t paying for mark-up costs for premade wicks. You’ll also need to get a supply of sustainer tabs. These can start for less than $20 for a wick starter kit.
Wax all depends on the quality and grade of wax that is being sold at each candle supplier. Each type of wax has different melting points and some are better suited for certain types of candles.
This is where the price range will differ for each variety you buy by the pound. Paraffin wax is certainly cheaper than Beeswax, while Soy and Coconut wax is similar in price to Beeswax.
It also depends on the supplier you’re buying from and the quantity that reduces the price per pound. Expect to pay $2.00-$5.00 per pound for any kind of wax.
If you’re going to sell candles in decorative jars, you’ll need to search around for the best prices in bulk. Mason jars often make the easiest to market while decorative votives or cups can see substantial increases per piece.
It will be better to look for clearance sales, restaurant suppliers, and bulk internet sellers for the best overall prices. Price ranges can be somewhere between $0.50-2.00 per jar or higher when looking for decorative glass.
Having custom labels on your candles or jars is the least expensive of your worries since home printers can make labels much cheaper than a print shop will charge.
Each label will cost you a few cents depending on the paper and ink you’re using.
Since several labels can be printed on each piece, 12 labels can cost you $0.25-0.50 per sheet. Print shops will be double this cost depending on the paper thickness you choose.
You can find packing supplies and boxes to pack your candles at any office supply or outlet that sells packing and shipping materials.
Just like anything else that’s meant to go into a decorative box or shipped, you’ll need to purchase packaging that is bought in bulk to reduce your overall costs.
Expect that prices will be cheaper after 25-50 pieces and substantially cheaper with 100 or more boxes that will range from $0.50 or more per piece.
Packing foam, peanuts, and bubble wrap will all have different prices if you’re shipping these items through a delivery service.
Candle Making Costs
How do you calculate the cost of making a candle? The first step in calculating the total cost of making candles is determining how many candles you are going to make as your first run. Add up all of the material you need to order to make that initial batch of candles, and divide that price by the number of candles you are making.
These are better classified into a group or series to give a clear number of candles that are produced. This is after you’ve done your testing for the wax, how well it burns, and if there are any problems with the design of the candle that you’ve made.
This is so you can determine the total burn time, how effective the scent is working, and how well the wick and wax are burning.
If you’re making as many as 10 or 20 candles per run, you can determine the total material cost by the number of materials you have purchased.
Wax, wicks, and containers
Take notes of how much wax it takes to fill each candle by the total number of grams that are used. Wick material and sustainer tabs are easier to calculate.
This is done by measuring the length of wick that you use by how many wicks can be cut from the length of roll you’ve bought.
If they’re already precut and have sustainer tabs, you divide the total cost by the number of pieces you’re using. Leave out the decimal point so only the number remains.
This should give you a price amount that you can instantly see is the cost for just these items. This is repeated for the wax as well and the containers including your jars or votives.
If you’re using a mold, this is a cost that isn’t outgoing since these can be reused and will be part of your candle production.
Fragrance and oil
How much oil and color is used to scent your entire batch of candle wax is estimated by the total amount that is added to a melted batch mix.
If you don’t have large wax melting pots, this will be harder to factor, so be sure to take formula notes for the exact recipe if you’re making more than one batch at a time.
Once again, the amount of oil and color that’s used can be divided by the total weight of the wax per batch.
Labels and packaging
This isn’t so easy to estimate the total cost unless you’re itemizing ink cartridges and pieces of paper, or trying to calculate the amount of electricity used to power a printer, so it really comes down to rough guesswork.
The simplest way to estimate these costs is how much ink and toner are costing in addition to the paper used. These are divided under the total cost by how many pieces of paper are used.
It’s still mere pennies if you print these things at home, but unless you’re very precise you won’t get a true number for a variety of reasons.
This is why rough estimates are allowed when it comes to this. The packaging on the other hand is just a matter of how much the box costs on average to the number of boxes that were bought in bulk.
Shipping a single candle will be higher than shipping several at a time. It also depends on which delivery service you’re using, so itemizing each candle is based on group orders rather than single orders.
It may not be worth using a shipping service that charges you more for shipping a single candle unless it’s large enough to warrant being itemized as a single item.
Candle Business Profit Margins
What is a good profit margin for a candle maker? A good profit margin for a candle maker is between 50% and 80%. These kinds of profit margins mean you are putting a markup on your candles of between 100% and 400%. Which is common among small and boutique candle makers.
Profit margins can be tricky since you want to make your product attractive to buyers who want a lower asking price than the competition.
For all starting candle companies, you can always begin with a 50% margin for profit which isn’t much when making candles.
As you become established, you can increase the price to a range that is considered competitive pricing. This is called the ‘going rate’ and isn’t uncommon to stay competitive with others who sell similar products.
Higher margins are reserved for those who make a name for themselves with a product that is respected and sought after. Keeping your candles priced to be attractive to buyers is always the best step forward.
What should I charge for my candles? Start with prices that are attractive and below what others are charging. Call it what you want since introduction sales, spring clearance, or Black Friday blowout, these prices must attract customers who can appreciate quality products.
Once these are selling well, you can then adjust your prices to be more competitive.
Can you make a living by selling candles? You can make a living selling candles, however, you will need to be selling several hundred candles per month. You will need to secure some wholesale accounts and be selling a lot of your candles yourself online. Online orders are where you will make your best margins.
To make a candle profitable, your candles need to have combined function and form that is never compromised. It’s easy to say that cost-cutting is a good way to make candles, but this isn’t always the case.
If you’re passionate about making candles, make them your mission. You can make some very good profits by selling candles because they are essential for celebrations and special moments.
Pros and Cons
Pros and Cons of Making Candles At Home
Pros of Making Candles At Home
- Start-up costs can be kept low
- You can offer lower prices to attract new buyers
- You can show your passion and quality for candle making
Cons of Making Candles At Home
- Initial cost of setup can be felt for the first few orders
- Hot candle wax can cause burns
- Candle making is dedicated work that isn’t as easy as it looks
Pros and Cons of Having A Candle Business
Pros of Having A Candle Business
- You set your own hours and work schedule
- You can set your product apart from other competitors
- You represent your product to your advantage
Cons of Having A Candle Business
- There is always competition and rivals
- You have to do testing for every new candle you create to ensure safety and quality
- You will need to reduce your price margin at the very beginning to get into the game
Where can I sell my candles? The best place to sell candles as a new candle maker is online through Etsy, eBay, Facebook, and local craft shows or farmers markets. In addition, you can approach local shop owners about selling your candles on consignment or wholesale deals.
Set up a website that’s your private domain and attaches a method for buying and ordering candles. It can be linked to several online sites that you choose. The best is to set up a Paypal account so you can sell your product on specific platforms.
Etsy is good for those that start out but this is why you want to get good exposure first. After this, it’s easier to get attention on your main website for continued sales. Etsy charges 5% for any product that sells and also for a product listing. It’s not a bad idea but it is full of artsy folks doing the same for a quick buck. To get the attention you’re looking for, you’ll need to have a strong website to make your candles shine better than everyone else.
Facebook can be a real pain for trying to sell anything if you have a profile. The best you can do is to advertise sale items and show what products are new. The link you add is where the actual sale comes from which should be from Etsy, eBay, or any other official online store. Facebook is great for targeting niche groups that can share your news and feeds to get your product known. The best part is that it’s free but takes continual work to manage.
This is a no-frills online site that sells items right away. This uses Paypal to buy products which often protects the buyer and not the seller. Because of this, you need to have very strong delivery records including the exact weight of your shipment and records of what was shipped. Many sellers find their products are refused and returned if something is broken only to find it’s replaced with something else that isn’t their product at all.
Paypal has a repeated history of automatically refunding the buyer by default because of this buyer scam. Other than that, most buyers are looking for a seller who has a good rating and great reviews.
The age-old farmer’s market is a great way to network and won’t differ much from location to location. This is hit or miss and is always subject to haggling and bartering for your products. You’re better off finding a convention hall circuit for vendors who are small businesses. Search for trade shows and trade fairs that will introduce you to a larger canvas of potential buyers.
Candle Business Insurance Requirements
Do you need insurance to sell candles? If you start a small business, you need to protect yourself from unseen damages that may result in wrongful actions against you. This is why you need to contact any insurance company to get liability insurance that protects you from general liability claims.
Someone who let their house burn down from your candle is not your fault. This is why this type of insurance will protect you and your business.
If someone has a claim against you for something that wasn’t your fault, your insurance will handle this claim that protects you from any wrongdoing.
It’s not required but for candle making, but it’s always better to be prepared for having legal protection.
Candle Making Seasonality
Is candle-making a seasonal business? This is not a typical seasonal business since you can be preparing for Christmas orders as early as February or March. Once you get established, it’s a business that is year-round and that’s what makes it a continual business rather than a few orders that come from the holidays.
A seasonal business will be the kind that pops up just for that season only and then is gone after that. When you’re into the candle business, you’re making continuous business all year long.
Frequently Asked Questions
It is worth starting a candle business even if it is something that you only want to do part-time. If you are making fairly decorative and premium candles you can make a decent income only by working part-time.
A small candle business making 120 candles per week, with a COGS of $3.00 each using a 300% markup can make $1080 per week after expenses. This number can increase by selling more candles, or by increasing profit margins.
You can sell homemade candles on etsy, facebook, ebay, farmers markets, craft shows, yard sales, and flea markets.
You can sell candles fully from home by having the post office or USPS pick up your deliveries for online orders at your home.
Start your own candle business as a sole proprietor simply by getting insurance for your business and collecting sales tax for quarterly tax deposits. You can start a candle business for only a few hundred dollars.
In conclusion, candle making can be a very profitable business with profit margins routinely between 50% and 80%. These types of margins depend on how you sell your candles, and where you sell them.
However, if you are making a premium product, people will be willing to pay a premium price.
That is the real kicker. You have to be good at making candles if you want to make money doing it. That means you are going to have to do a lot of practice making candles, and give some away to your friends for free until you have mastered your craft.