The following is a blog featured on the Silkfair shopping site. Way to go Trish from Soapy Blessings! She really knows how to explain the difference between handcrafted and the superstore on the corner.

On the days that I make soap, I admit that I get very excited in anticipation of the day. Because I work full time at a secular job, I don’t devote my time entirely to soaping, but have to set aside a time in the week for it. The time I set aside is a real treat for me and I look forward to that day that I have set aside immensely.

So, at this point at least, making soap is not my method of making ends meet, not even close. It IS a desire of mine to make that a goal, however. With that thought in mind, I chose to review what my costs are to make my soap, and how much I am making as profit on my soap…or am I making a profit?

As with most new little start up businesses, and this is a business for me, they don’t always make money intitially. In the first few years of opening my little soap business, I showed a loss because of buying equipment and getting enough supply to make it viable. Then, it was drawing customers to my soaps and building a customer base. It all takes time. Now, I am at a point where I am breaking even (whoo hooo!) I am learning to make the most of my soaping methods. Still, I would certainly like to do much better than “break even”.

It was time for me to review how much it is costing me to make my soap. Am I charging enough for this amazing stuff? Am I counting in all my cost factors? So, I began to break it all down…the results were just a bit eye-opening for me. I already know basically how much soap I will make this year based on customer purchases and trends from the previous year, so base my cost per estimated bars I will make.

Here is how I broke it down:
I added up the cost of the supplies I use most often in my soap per batch, such as oils, sodium hydroxide; the basic stuff.
I added up the cost of the “extra” supplies that I most often use per batch, accessory stuff like, calendula blossoms, rose petals, fragrance or essential oils, oxides, micas and other fun little additions to the basic soap formula.
I added my basic cost of packaging each bar of soap.
I averaged the yearly cost of supplies that I use regularly, such as soap molds, wax paper, bowls, scales etc and broke it down per bar.
I added basic prep and production time per bar of soap (like paying myself wages for making them)…about 1/2 the amount per hour that I make on my “usual” secular job.
I added Paypal fees, listing fees, fees when the soap is sold, and average per year craft showing fees per bar of soap.

I did not add cost of electricity, sewer, water, phone, internet access, although I should if I were to be more accurate.

The end result?

At my current charges per bar of soap, I only make about $1.62 per average size (4 to 4.5 oz) bar! That is paying myself wages. So, this little extra money would be the stuff I would put in the my savings for my next vacation?

At that rate, it will be years before I get a vacation!

Could I cut more corners and make more $$$? Absolutely! It would take some additional sacrifices of freshness of the oils I purchase and quality of my product to do it though. If I bought more bulk product, it would certainly be much less expensive. The down side is that I don’t make enough product right now to ensure freshness of my oils if I bought bulk, so resort to making smaller batches at this time. There are a lot of other small ways I could cut costs and I am still in the process of streamlining and revamping some of the things I do.

Doing this was a great reality check for me even though I already kind of knew it based on keeping decent records that I wasn’t making the thousands that I always envision.

BUT…It won’t keep me from continuing to make soap. This is wayy too much fun!