America has a candle obsession.
Each year, candles account for about $3.2 billion in sales. It’s part of the swelling home decor industry which is estimated to make about $664 billion in 2020.
So, what’s the deal with candles? Candles serve many purposes including providing mood lighting, adding a sense of calm to a room, and removing unwanted odors.
Thanks to their many purposes as well as their overall attractiveness, it’s a growing industry that many crafty people want to be a part of.
It’s also not hard to start making and selling candles as a business. The supplies are relatively low cost and you’d be surprised at how easy it is to find buyers.
If you’ve been looking for an easy home business to start, why not try giving candles a try? Keep reading to learn about our top tips to make your candle business a success.
Develop a Business Plan
One of the most frequent mistakes many small business owners make is not writing a business plan. This is especially true of individuals who make craft items to sell.
There are a few reasons to develop a business plan when selling candles.
The first is that a business plan helps you stay focused. When you first start your business, it will be tempting to go in several different directions and can make you lose sight of what will help you in the long run.
The second is that it’s easier to set and stick to goals you set for your business. These goals can be unit-based or profit based. Whichever you choose, remember to keep them measurable.
Your business plan should also have your business name, collateral, and any other logo assets you might need as your business grows. You should also map out what types of venues you’ll start out selling at like farmers markets and how you’ll move into other channels like wholesale or online.
Know Your Market
Whenever you sell a product or service, you need to know who you’re selling to. Doing preliminary research on who you will sell to is a crucial first step in setting up a home business.
Here are some key questions you should know about your target market:
- Demographic information
- Where they live
- Amount of disposable income
- What are their interests
- Does “made in the USA” make them want to buy products?
When you can understand who your target customers are, you can better market to them.
Make Your Value Proposition Unique
If you’ve been to any home decor shop or big box retailer, you’ve likely noticed the vast number of candles available for sale. To stand out on the shelves (physical or virtual), you need a specific value proposition.
Here are few suggestions to help you stand out from the crowd when selling candles:
- Soy candles
- Vegan candles
- Aromatherapy candles
- Candles in cool containers like wine bottles
Doing thorough research on your target audience will help you determine what they’re most interested in.
Have a Solid Product
Before you start selling candles, you need to master the formula. Luckily, there are tons of resources available online to teach you how to make candles.
Something you’ll need to avoid is copying someone else’s candle recipe. That’s still copyright infringement and a serious legal issues.
Take the time to develop your own recipe that burns slowly and smells great.
Form an LLC
Before you start selling candles, you need to form an LLC. Having an LLC separates your business operations from your personal liability.
Having an LLC also means you can pass-through taxes. Your LLC won’t be taxed as a business; rather, you collect any profits and report those earnings on your personal tax return.
When you have an LLC, you are automatically protected against certain damages that can occur as your business operates. However, if you unintentionally file your taxes incorrectly or unintentionally commit a crime for your business, your LLC will not protect you. You can get additional personal coverage to protect you personally.
Minimize Your Costs
Candlemaking itself is a relatively low-cost business to get into. However, the cost of traveling to trade shows, shipping packages, and scaling candle production can add new costs that you didn’t initially foresee.
When you start selling candles, figure out how to minimize your costs by tracking your fixed and variable costs. You should always be asking yourself how you can reduce costs without diminishing your product quality.
You can lower some product costs by buying supplies in bulk from a wholesaler rather than through your local craft store.
Find the Best Supplier
Candles can be made from a number of materials including soy wax, beeswax, and paraffin. Because each is different in burn speed and quality, costs differ. Before you start making candles en masse, try testing each material to make and burn candles.
Once you’ve selected your wax, try a few different batches from different suppliers. You’ll want to find the best balance for quality you can afford.
Packaging is another item you’ll want to find a good supplier for. If you’re shipping items, you’ll want to buy shipping packages and peanuts in bulk to save money.
Spread the Word
If you’re selling candles online, you will really need to concentrate your efforts on spreading the word about your business. Social media, particularly Instagram, Pinterest, and Facebook, are great platforms to reach new audiences to show off your candles.
Giveaways on social media are another way to not only get more people interested in your business but also to collect email addresses that you can later use for email marketing.
When you’re just starting out in the candle business, getting feedback on your product is critical. Ask friends, family, and a select group of customers to test your initial products and provide feedback on how you can improve them.
Don’t think you can stop getting feedback after your business is up and running. Before you launch any new product, collect feedback and adjust your recipe before launching.
Have an Inventory System
Once you get to a point where you’re selling hundreds of candles, you’ll need a way to keep track of them all. This is particularly important if you’re selling a variety of scents and sizes.
One way to easily manage your candles is to use an SKU inventory system. It tracks what’s in your inventory based on the metrics you provide it.
Selling Candles Like a Pro
While selling candles might seem like a no-brainer, it requires more thought and planning than people might imagine. But when you produce a great product and master the basics of business, you can grow your candle business into a full-time income.
Need more tools and tips to help your business succeed? We’ve got you covered.