Candle Making Business: How much money can you make?

Starting a candle-making business can be a great way to make extra money. The process is relatively simple, but candles are also in high demand and can be sold at various prices depending on your products and marketing strategies. This article will discuss how much money you can realistically expect to make with a candle-making business.

The average person can realistically expect to make between $20,000 and $50,000 per year selling candles. This number can vary greatly depending on the size of your operation, the types of candles you sell, and how well you market your products.

This article will discuss how much money you can realistically expect to make with a candle-making business, the costs associated with the company, and ways to reduce these costs. Let’s dive in.

What is a candle-making business, and how does it work?

A candle-making business involves creating candles using various methods, materials, and scents. Candles can be made from Soy, Paraffin, Beeswax, Coconut, Rapeseed, Palm wax, or a combination of these. The wax you use will affect the price of your candles and the burning time, scent, and appearance.

The goal of the business is to create unique products that your customers love and keep coming back for more. In order to be successful within the candle-making business, you need to have a strong brand, product, marketing, and pricing strategy.

Hold up a minute; if you are interested in knowing the difference between the waxes you can use to start your candle business, we encourage you to read our Soy, Paraffin, Beeswax, Coconut, Rapeseed, and Palm wax guides.

How much money can you make with a candle-making business?

The amount of money you can make with your candle-making business will vary greatly depending on the size and scope of your operation. If you’re selling candles out of your home, you’ll likely only earn a few hundred dollars monthly. However, you could make millions of dollars annually if you have a large operation with multiple employees.

The average person can realistically expect to make between $20,000 and $50,000 per year selling candles. However, as we mentioned earlier, this number can vary greatly depending on the size of your operation, the types of candles you sell, and how well you market your products.

Large corporations in the candle-making space like the Yankee Candle Company and candlescience.com make millions of dollars in revenue every year. So there is no ceiling to the money you can make with a candle-making business. But reaching these dizzying heights is very difficult and unlikely for most aspiring candle makers.

To make a sustainable and profitable business, you will first need to know how to work out your business’s profits. We explore this in the next section.

How to calculate the profit on your candles?

The price you charge for your candles will have a direct effect on the profitability of your business. In order to make a profit, you will need to sell your candles at a higher price than it costs you to make them.

To calculate your per-unit profit, subtract the cost of materials and products from the selling price of the candle. For example, if it costs you $3 to make a candle that you sell for $10, your per-unit profit would be $7.

Once you’ve calculated your per-unit profit, you can multiply this by the number of units sold to find your total profit. For example, if you sold 100 candles at a per-unit profit of $7, your total profit would be $700.

To find your total profit, you will need to subtract your expenses from your revenue. Your expenses will include materials, packaging, shipping, marketing, and other associated costs. For example, if your total expenses are $1,000 and your total revenue is $5,000, your business profit would be $4,000.

Remember that your profits will vary from month to month, and it may take some time before you start seeing a consistent return on your investment. Be patient and focus on building a strong foundation for your business.

In order to achieve a profitable business, you must have a sound pricing strategy. To create a well-rounded pricing strategy, you must first understand the basics of material costs and how these will impact your product’s overall price and profit. In the next section, we will review the elements of candles and how these impact product cost.

How do candle materials affect product cost?

Type of Wax

The type of wax you use will have the most significant effect on your product’s cost. Soy, beeswax and coconut wax are generally more expensive than paraffin wax.

The price of soybeans, bees, and coconuts fluctuates with the market so these prices can change without much notice. On the other hand, paraffin wax is a by-product of the petroleum industry and is much more stable in price.

The price of soybeans, for example, has increased significantly in recent years, making soy wax more expensive. The good news is plenty of other affordable options like paraffin and rapeseed wax.

As you can see, beeswax is significantly more expensive than coconut, soy, and paraffin wax; however, beeswax has many benefits that we have an article all about. You can charge more for beeswax and palm candles without the customer feeling like they are overpaying.

Wicks

Wicks are made from a variety of materials, including cotton and wood. Cotton wicks are the most popular because they self-trim and produce little to no soot. Wood wicks, however, can be tricky to use and often have more soot.

Cotton wicks also come in a variety of sizes that affect the price. The rule of thumb is that the thicker the wick, the more expensive it will be. For example, a 6-inch cotton wick will cost you about $.03, while a 12-inch wick will cost approximately $.06.

The table below shows the average cost per foot of cotton and wood wicks.

As you can see, wood wicks are significantly more expensive than cotton wicks; however, they can give your candles a more rustic feel that some customers may be willing to pay extra.

Scent

The cost of fragrance oils varies greatly depending on the type of oil, where it’s sourced, and the company you purchase it from. For example, a popular fragrance like lavender can cost as little as $3 per ounce or as much as $10 per ounce.

The table below shows some popular fragrance oils’ average cost per ounce. These prices were pulled from online candle supply stores and may not reflect the actual cost in your area.

As you can see, the cost of fragrance oils can vary greatly; however, cheaper oils are often not as strong as their more expensive counterparts. You may use cheaper fragrance oil to achieve the same scent throw as a more expensive oil.

Colour Dyes

The cost of candle dyes also varies depending on the type of dye, where it’s sourced, and the company you purchase it from. For example, a popular colour like red can cost as little as $2 per ounce or as much as $5 per ounce.

The table below shows some popular candle dyes’ average cost per ounce. These prices were pulled from online candle supply stores and may not reflect the actual cost in your area.

As you can see, the cost of candle dyes can also vary greatly; however, like fragrance oils, cheaper dyes are often not as strong as their more expensive counterparts. You may have to use a more inexpensive candle dye to achieve the same colour intensity as a more expensive dye.

Containers

The cost of containers also varies depending on the type of container, where it’s sourced, and the company you purchase it from. For example, a popular container like a mason jar can cost as little as $.50 each or as much as $5 each.

The table below shows some popular candle containers’ average cost per container. These prices were pulled from online candle supply stores and may not reflect the actual cost in your area.

As you can see, the cost of containers can vary greatly; however, like fragrance oils and candle dyes, cheaper containers are often not as high quality as their more expensive counterparts. More affordable containers may not hold up to repeated use or may not be as heat resistant as more costly containers.

Packaging

The last thing to consider is the packaging. Your candles need to be well-packaged to sell. This includes the box, labelling, and any other materials you need. Packaging can be expensive, but it’s worth it to make a good impression on your customers.

The cost of packaging can add up quickly; however, it’s important to remember that packaging is what sells your candles. If your packaging is cheap and flimsy, it will reflect poorly on your candles. Conversely, if your packaging is high quality, it will make your candles look more expensive and entice customers to buy them.

What are the equipment costs when starting a candle-making business?

The costs of starting your own candle-making business will depend on the size and scope of your operation. If you’re planning on selling candles out of your home, you can get started with a few hundred dollars. However, if you’re planning on opening a large candle shop, you’ll need to have thousands of dollars in the start-up.

What equipment do you need to start?

While you can technically start making candles with just a few supplies, we recommend investing in some essential equipment to make the process easier.

We have linked starting equipment below that you can buy on Amazon, and we have included the prices and the total value if you decide to buy the below products for your business.

The total price of the above equipment will cost $142.18.

As you can see, essential candle-making equipment costs a few dollars to several hundred. While you don’t need all this equipment to get started, we recommend investing in a few key pieces to make your candle-making process easier.

What supplies do you need?

In addition to equipment, you’ll also need some supplies to make your candles. The table below shows some essential candle-making supplies and their average cost. These prices were pulled from online candle supply stores and may not reflect the actual cost in your area.

Remember before ordering supplies in bulk, ensure that you have your candle formula perfected so that you do not order waste stock and damage your businesses finances.

We have linked starting equipment below that you can buy from candle science. We have included the prices and total value if you purchase the products below for your business.

If you’re looking to save money on supplies, we recommend buying in bulk. Many candle supply stores offer discounts when you purchase large quantities of wax, wicks, fragrance oils and dyes.

As you can see, the cost of candle-making supplies ranges from a few cents to several dollars. The exact cost will depend on the wax and fragrance you use. We will cost this all up after we have reviewed packaging.

What packaging do you need?

Once your candles are made, you’ll need some way to package them for sale. The table below shows some of the most common candle-making packaging and their average cost. These prices were pulled from online candle supply stores and may not reflect the actual cost in your area.

Again, I have linked starting packaging below that you can buy from Amazon. We have included the prices and total value if you purchase the products below for your business.

If you’re looking to save money on packaging, we recommend buying in bulk. Many packaging companies will offer discounts for large volumes and orders.

As you can see, candle-making packaging costs range from a few cents to a dollar. The exact cost will depend on the type and packaging you use.

How much would it cost to make 100 candles (not including marketing and overheads)?

Based upon the above information 100 candles would cost:

Equipment = $142.18

Supplies (if you went for the cheapest) = $381.72

Which is made up of:

• 45 lbs of wax = 2.80 x 45 = $126
• 45 oz of fragrance oil = 2.92 x 45 =$131.40
• 100 wicks = $6.12
• 100 glue dots = 0.05 x 100 = $5
• 100 containers = 0.75 x 100 = $70
• 45 dye blocks = 0.96 x 45 = $43.20

Packaging = £176

Which is made up of:

• One Box Per Candle = $0.96 x 100 = £96
• Decoration per box 10g = $0.8 x 100 = £80

Total cost of 100 candles including initial equipment = $699.90

Total cost of 100 candles not including equipment = $557.72

After the initial investment of equipment you will only need to buy the supplies so you unit cost not including the initial investment that you will recoup from your profits would be the below calculation.

Unit cost including initial investment = 699.90 / 100 = $6.90

Unit cost not including initial investment = 557.72 / 100 = $5.58

What are the costs associated with marketing your candles?

Marketing is an essential part of any business, and candles are no exception. The costs of marketing your candles will vary depending on your marketing type. Some everyday marketing expenses include advertising, trade show displays, and website development.

The table below shows the most common candle-making marketing expenses and their average cost. These prices are based on national averages and may not reflect the actual cost in your area.

You can check out our article on promoting your candle business, including ways to promote your business for free or with very little investment.

As you can see, the cost of marketing your candles can range from a few hundred dollars to several thousand. The exact cost will depend on your marketing type and quantity.

How much can you expect to make selling candles?

The amount of money you can make selling candles depends on several factors, including the type of candles you sell, the price you sell them for, and how many candles you sell. The table below shows the average wholesale and retail prices for some of the most popular types of candles. These prices are based on national averages and may not reflect the actual cost in your area.

As you can see, the average retail price for a pillar candle is $10-$20, while the average wholesale price is only $2-$4. This means that selling just one pillar candle at retail could make a profit of $8-$16. However, if you sell that same candle wholesale, your profit would be only $0.50-$1.

To get an idea of how much money you can make selling candles, let’s say you sell 200 pillar candles per month at an average retail price of $15 each. This would give you a monthly sales total of $3,000. If your wholesale costs totalled $400 for the month, your profit would be $2,600, or about $88 per day.

Of course, this is just a rough estimate. The amount of money you can make selling candles will depend on several factors, including the type of candles you sell, the price you sell them for, your marketing efforts, and your overhead costs.

How to price your candles?

Pricing your candles can be a tricky business. You want to price them high enough to make a profit but low enough that people will buy them. The best way to find the right candle price is to start by looking at your competition. See what they’re charging for their candles and use that information to help you set your own prices.

Based upon the above example where we found the unit cost to be $5.58 when making a volume of 100 candles as a general rule we would apply a mark-up of 50% or more. Based upon this your sale price would be $11.16.

You would round this up to $11.99 for pricing buyer psychology.

Remember, the $6.41 ($11.99 – $5.58) profit would not be a profit entirely for your business. You also will need to factor in your business overheads, labour, and marketing. These costs must be factored into your pricing strategy, but the 50% margin should cover this. Work out the costs yourself and absorb them into your unit price.

You may need to charge more based on your answer, but this will be different for each individual, whether you are working from home, renting a space and how much you want to pay yourself hourly.

Once you have an idea of the going rate, you can start to adjust your prices up or down based on the quality of your candles and the costs associated with making them. For example, if you use higher quality materials and put more time into making your candles, you can charge a bit more for them. On the other hand, if your candles are simpler or you have lower production costs, you may need to charge less.

Sampling & Price Adjustments

The best way to find the right candle price is to experiment and see what people are willing to pay. Start with a few different price points and see how they do. Suppose you find people buy your candles at a particular price point – stick with this price as long as the profit margin is high enough to allow your business to grow. If not, adjust your prices accordingly. The most important thing is to find a price that works for you and your customers.

A more direct method to find what your customers are willing to pay is to conduct market research on a sample of your customers. This can be done in several ways, but surveys and focus groups are the two most common methods.

With surveys, you create a list of questions related to your candles and send it out to a group of people. You can either do this online or in person. Focus groups are similar, except that instead of sending out a list of questions, you gather a group of people and ask them questions in person. This can be a bit more expensive than surveys, but it can also give you valuable insight into what people think about your candles.

The best types of candles to sell for profit

The type of candles you sell will significantly impact your profits. Some types of candles are more popular and can command higher prices. That being said, some types of candles are easier to make and may have lower production costs. So, it’s crucial to balance popularity and profitability when choosing the kind of candles you sell.

Some of the most popular and profitable types of candles include scented candles, soy candles, and beeswax candles. Scented candles are always in high demand and can be made with various fragrances. Soy candles are becoming increasingly popular due to their environmental friendliness. And beeswax candles have a long burn time and are considered high quality, making them a popular choice for many customers.

Of course, many other types of candles are out there, and it’s essential to find the ones that work best for you and your business. The best way to do this is to experiment with different types of candles and see which ones sell the best. Once you find a few types of popular candles with your customers, you can focus on selling those.

How to reduce costs and boost profits in your candle business?

You can reduce costs and boost profits in your candle business in several ways. One way is to source your materials from wholesalers or manufacturers. This can help you get better prices on the products you need to make your candles. You want to aim to source your products directly from the source, removing any mark-ups that intermediaries in the supply chain will add to the wholesale price.

Another way to reduce costs is to streamline your production process. This may involve investing in better-quality equipment or finding ways to make your candles more efficiently. The goal is to reduce the time and money you spend making each candle. More hours spent making your candles equal higher labour costs that need to be factored into your overall cost.

Finally, you can also boost profits by selling your candles online. This gives you a wider audience and can help you reach more customers. You can sell your candles through your website or online marketplaces like Etsy.

FAQs about starting and running a successful candle-making business

Is it cheaper to buy candles or make them?

The answer to this question depends on a few factors, including the cost of materials and the time it takes to make the candles. Generally speaking, it’s cheaper to buy candles than make them. However, if you can source your materials in bulk and already have the candle-making equipment, you can make candles at a lower cost than you could buy them.

What is a good profit margin for candles?

When starting a candle-making business, it’s important to remember that you need to make a profit to stay in business. A good rule of thumb is to aim for a 50% profit margin on all of your candles. This means that for every dollar you sell a candle, you should make at least 50 cents in profit.

Of course, this number may vary depending on the type of candles you sell and the market conditions. But it’s a worthy goal to shoot for when starting. By making a healthy profit margin on each candle, you can ensure that your business is sustainable in the long run.

How much should I sell my homemade candles for?

As a general rule, you want to aim for a 50% profit margin on your candles if they are handcrafted and homemade. So this means work out the total costs of your candles, including materials, labour, and transportation, and double the price.

Final Thoughts

Starting a candle business can be a great way to make extra money. But there are a few things you need to keep in mind if you want to be successful. First, you need to choose the right type of candles to sell. Second, you need to find ways to reduce your costs and boost your profits. And finally, you need to have a good marketing strategy. If you can do all these things, you’ll be well to running a successful candle business!

If you have questions about starting or running a candle business, feel free to ask on our contact page. We’ll be happy to help!