# How much should I ask for my soap bars?



## Dana

Since I'm new to making soap, I didn't know if I'd have any luck selling for the prices I see others asking. Should I price my 5-6 ounce goat's milk soap for $4 a bar, or is that too high?

Here's a pic of my first attempt:


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## MF-Alpines

Too low. Going rate that I've seen in the midwest is at least $1/oz. I'm working at getting my bars down to 5 oz as I charge $5/bar. Some of my bars are over 6 oz.


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## MF-Alpines

Love the pic! But tell me it's not only goat's milk and CO in the bar????


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## adillenal

I agree with Cindy. At least $5.00 a bar. I sell my EO bars for a dollar more at $6.00 a bar.


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## Dana

No I have coconut oil, goat's milk, canola oil, and lard. I put the ingredients on my website with this picture.


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## Anita Martin

My bars run around 5.5 to 6 oz and I'm at 5.50 to 6.00 per bar. I do offer a price break for multiples. Right now it's 4 for $20 or on Etsy you get free shipping with 4 soaps but they are $6 there. Most people that buy natural soaps find them a good value. I've heard comments that they are bigger than other soaps they've seen elsewhere for the same price. I buy in bulk to save on my costs so I can offer the soaps at a lower price...fragrance is the one thing that keeps my profits down on certain soaps. My patchouli bar is now $7.50 and I know some charge even more and I don't do a discount on that one. My price per bar for that essential oil at the price I got it and using the amount I use is .57 cents per bar just for the scent. On other soaps the scent is cheaper, usually somewhere around .26 cents per bar or less. I do several that are unscented, so if I factor those in, it spreads the higher prices out somewhat but since I sell more of the higher priced soaps, I think it's really necessary to charge more for them. 

Using bulk oils and lye, and oil I got for free, the price per bar is under a dollar before adding scent. If you think of marketing costs, gas to travel to shows, fees, internet fees, etc. that adds more to the cost of each bar. Selling them too low basically means spending time to make soap to give away for free


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## jimandpj

You are all thinking about it wrong. Who cares what everyone else is selling their soap for. That doesn't matter. Your business is not based on what others sell it for. If you're setting your soap prices based on that, then it is just a hobby, not a business.

What does it cost you to make your soap? Including labor at a REAL price, not $5 an hour? Overhead? Taxes? Insurance? Accountant? Website? Packaging? Utilities? Overhead? Space? Paperwork? Postage labels? Packing supplies? Gas to the market? Time spent at the market? Time spent doing research and development? Customer service time?

Figure this out. If you want to get even more business-like, break it down by COGS (cost of goods sold - the items that vary based on the number of bars you produce) and expenses ($ that are relatively steady whether you make 100 bars or 10,000 bars).

I've said this so often, as your business grows, you'll be amazed at how much cash it takes to keep it going. Don't price yourself too low from the outset. Price yourself where you need to be and work your business. You don't have to be (or want to be) the lowest price guy out there. The only way to win at that game is to pump out the volume, and you'll exhaust yourself!

Just my 2 cents...

PJ


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## NubianSoaps.com

Excellent post PJ....like that perverbial gallon of milk, how much does it really cost you to get that gallon into your customers hands. Same with soap. Vicki


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## old dominion

You might find this interesting. The site also has a part II for costing out soap.

http://www.teachsoap.com/cpcosting.html

Jolene


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## MF-Alpines

Good point, PJ, but I think it depends on where you are selling. If you're at a FM and there's more than you selling soap and their bars are cheaper, say $2/bar cheaper, then you probably won't get many sales just based on price.


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## Faye Farms

My soaps are half your size and I price mine at $4 a bar. My bars are 3 to 3.5 oz. Most of them cure out to 3.2 oz.


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## jimandpj

Cindy - I completely disagree. Been there done that. We've always been able to sell our soap even when there are people selling it for cheaper (and sometimes a lot cheaper if they're just hobbiests). We give away lots of free samples and the quality of my soap always speaks for itself. Plus, to be honest, there are a lot of people who think that items are better just because it costs more.

But you can't be worried about it - if you think that your soaps are too expensive, than that will come through to your potential customers. And you won't sell well. If you have a bad day and blame it on the fact that your soaps are too expensive, you're going to start questioning things and it will go down hill from there.

Which leads me back to my main point. Don't worry about what anyone else is pricing their soaps at. Figure out what it REALLY costs you to make your soap and base your pricing on that. Then you can believe in it!

PJ


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## JamieH

I don't know about cost, but that photo is lovely. A good website or etsy shop can do wonders when it comes to sales. I think my website is one of the reasons I'm doing so well with kid reservations with such a small herd. I always buy from a good website over a dated/unprofessional one and many of my friends feel the same way.


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## a4patch

Ditto to figuring out what your soap costs YOU.
My sister used a cost calculator and made the changes I needed to make it useful for soap. I put in each of my ingredients and cost per ounce and anything that require my time. Once I calculated MY cost for soap I times it times %200 for wholesale and %300 for retail. With this I know exactly what to charge for wholesale accounts and fro my retail accounts. 

cost for each item per ounce.
This includes:
oils
herbs
lye
fragrance
Milk ( I purchase from Anita here on dgi)

packaging costs:
wraping
ink
paper
tape

Some things cost per use because they will eventually need to be replaced.
buckets 
Mixer
mold
spoons
thermometer
printer

Time: times hourly wage 
Consider each process
prep work
mixing
heating 
pouring
unmolding
cleanup
stacking
packaging
(does not include the time at the farmers market)



This list is not 100% inclusive, but you get the point.


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## [email protected]

There is another goat milk soaper at the FM that I go to. She sells 2oz soaps for $1.75, I sell 4oz soaps for $5. I sell ten times what she does. Cheaper is NOT better.


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## MF-Alpines

I completely agree that cheaper is not the way to get sales. But lets talk about costs. When first starting out, most of us start small and (hopefully) get larger from there. So your costs at start-up are more because you are not buying a year's worth (or whatever basis you use to purchase) of materials so you don't get the quantity discounts. So profit will be less at this point. As the business progresses, and you buy larger quantities of raw materials, your costs go down and you make a higher profit. IMO, you can't ONLY base your sales price on cost; you have to take into account what the market will bare, especially in the beginning. LOL! I should say I instead of you because the size of the business plays apart as well. Do you see my reasoning?

As an aside, I thought I'd mention, PJ, THANKS! The publicity you get (The Today Show, O Magazine) always gets me some new business. Appreciated.


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## jimandpj

Cindy - I figured that would happen and I'm glad. It's raising the awareness of the benefits of goat milk soap. 



> As the business progresses, and you buy larger quantities of raw materials, your costs go down and you make a higher profit.


Unfortunately, this isn't correct. As your business progresses, your COGS decrease as a percentage of your sales (unless your wholesale business grows as a percentage of your sales). But your expenses dramatically increase. Dramatically. Especially once you outgrow your work space.

And I disagree that you need to take into consideration what the market will bare. As a new business you have no idea what the market will bare. People spend lots of money all the time on things they don't even need. It's your job to convince them that your soap is worth MORE than what you're even charging for it.

You can't base your business on what the market will bare or you are setting yourself up for a lifetime of minimum wages and 80 hour work weeks. You NEED to set your prices based on your costs. You need to have a profitable business model if you're going to succeed as a business. If you want it to just be a hobby and not make a sustainable profit, that's a different story.

Most people do not like raising their prices - why put yourself in the position where you start out knowing you're going to have to raise them?
PJ


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## NubianSoaps.com

6 ounce bars are being sold in retail stores from $6.95 to $12.95 of my soap. So what the market will bear is just like in our goats, I won't sell a milker for less than $500, so it now has become a price point for the area, milkstand ready milkers with CAE tests simply sell for this...you just think the market won't bear these prices in your area because you cave to the lower price. And price point is personal, although I retail here bars for $6, with my largest bulk retail sales for myself coming from 4 bars with free shipping, I am selling most of my retail soaps 6 ounces for $5 and change. 

My largest profit on bars are my naked wholesale, because it is such a labor saver....though you can't put a figure to the loss of sales I get with these with them not carrying my label. Hands down my income comes from wholesale sales into retail stores and the idea that getting one more store only means adding another can of water to the soup pot, like PJ says, expenses dramatically increase.


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## MF-Alpines

Great discussion, everyone.

I still don't understand one point. Yes, expenses increase because you're buying more, but if COGS decrease, aren't you actually making more profit? I do understand what you mean about outgrowing workspace, possibly hiring someone, advertising, etc., but not if I am still small enough to do this myself. Help me understand this, please. :help2


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## jimandpj

Cindy - in our experience, the expenses increase at a much faster rate than COGS (as a percentage of gross sales) decrease. And that is without adding in any labor costs or building a bigger workspace. 

But yes, if you're doing things correctly, your profit should increase as an absolute value (not always as a percentage, although we want to see that too).

Don't forget inflation and rising supply prices dramatically affect your COGS and can prevent you from seeing a decrease in your COGS as a percentage of gross sales. If you increase your wholesale business, that will also see your COGS as a percentage of gross sales increase.

PJ


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## MF-Alpines

Thanks, PJ. Yes, I understand now.


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