Are you looking to start your own business, work on your own schedule, and improve your personal finances? Consider making candles.
Candles are some of the world’s oldest gifts and tools. They’re never really out of style. If you want to learn how to start a candle business of your own, consider following this step-by-step guide so you don’t make any missteps.
Plan Your Candle Business
As with virtually any type of business, you’ll first need to figure out a business plan if you want to make and sell candles for a living successfully. This means answering several critical questions like:
- What types of candles are you making?
- What are your startup and ongoing costs?
- Who do you plan to sell the candles to?
By answering all these questions, you’ll be able to plan out your financing and develop a solid pricing scheme to ensure profitability in the long term. It’ll also let you know if starting a candle business and joining the candle market is a worthwhile idea. You can use an online business plan template as a guide.
Furthermore, study the candle-making industry ahead of time and decide whether you think you’d be able to sell candles consistently. Finally, research any candle-making business owner with a successful business to see what worked and what didn’t.
Figure Out Your Finances
Next, take a deep dive into your financial situation. You may be wondering, how much does it cost to start a small business? Or maybe you’re thinking bigger? Either way, operating a candle business can be pretty expensive. Of course, you can always use a personal finance tool to help organize your finances; but remember, you’ll need all kinds of candle making supplies like:
- Wax, gel, and other base materials
- Jars are containers for the candles
- Fragrance oils or essential oils so you can differentiate candle products
- Coloring agents and packaging supplies
- The shipping costs if you decide to provide shipping
It would help if you also thought about where your business will commence operation. For example, if it is not a homemade candle business, you’ll need to rent some business space. Then you have to consider your marketing budget.
Determine a Pricing Model for Your Candle Business
After getting a good handle on all your finances and boiling down your startup and ongoing costs, you can think about how you’ll charge for your candles.
A candle-making business will theoretically make most of its profits by selling candles directly to customers or through resellers (i.e., gift shops, the local craft store, or other retail stores). You can do all three, of course. So when calculating your total budget balance, decide who you’ll be selling candles to and figure out how much you’ll charge for your candles.
Decide On Your Business Model and Name
If it all looks good so far – you think your financial situation is tenable and you’ll be able to make a profit selling candles to either individuals or other companies – you can now decide on your business model and name. There are multiple forms your business can take to become a legal entity.
An LLC (limited liability company) is a standard business structure, as it limits your liability if your company faces a lawsuit. But you can also create a corporation, a sole proprietorship, or something else.
You should also figure out your name at this point. Your candle business should have a fun, catchy, and informative name all at the same time. People should know what you do but also be able to remember your business without much effort. “Jan’s Candle Boutique” is a good example.
Register for Taxes and Get an EIN
You’ll also need to register your business for different state and federal taxes, which involves applying for an employer identification number. Do this through the IRS main website.
Check for Necessary State Licenses
It’s also wise to apply for any necessary state business licenses. Different states may have separate licensing requirements based on the business and materials you use. It’s unlikely that a candle business will run into much bureaucratic pushback. Still, you should double-check to be sure, especially if you need to use hazardous or potentially toxic materials (like certain types of synthetic gels).
Open a Business Bank Account
At this point, you can open up a business bank account to separate personal and business expenses. This makes controlling your spending much more manageable. You can also apply for a business credit card, usually done at a local branch in under 15 minutes. This allows you to apply for certain types of financing and benefit from other deals for small business owners.
Furthermore, it would help if you looked into getting insurance for your business. Business insurance can protect you in the event of a lawsuit or if something happens with one of your candles (like if a kid swallows a piece or something). It’s all about protecting your business if someone gets fussy.
You’ll also need workers’ compensation insurance if you decide to hire employees. Commercial property insurance is another option for candle makers with office space.
Get Your Space Up and Running
You’re almost there! The next step is to have your own candle business is moving to the office space you rented or starting the candle-making process at your home office. Depending on how much space you need and how many materials you purchased, this could easily take up to a week or more. Be sure not to tell people that you’re open for business while you’re still setting things up.
Market Your Candle Business
Now it’s time to market your candle line; after all, you won’t make much profit if people don’t know you in the candle industry! There are several ways you can do this effectively.
Market Online/Build a Website
Of course, it’s a good idea to have your own website and focus at least some of your marketing efforts online in the digital age. While candles, and those in your target market, may not be the most digitally inclined, virtually everyone has an email address these days. You can use email address collections to send newsletters or spend money on online advertisements for visitors to specific websites.
Social media platforms are another way to market your business online and boost candle sales. You can have different social media accounts and create a marketing plan for each. First, understand your potential customers and what appeals to them. Then, sell your brand story with your marketing strategy, focusing on what separates you from the many candle makers.
Hand Out Business Cards
Physical business cards are a tried-and-true method of marketing. These are great if you have friends in other professions, and they promise to hand out some of your business cards to their friends and associates. If you’re a member of social organizations like book clubs, you can hand out the business cards there, as well.
Post Flyers Around Town
A good old-fashioned flyer spree is a third excellent idea for new business owners. This is especially useful if you want to advertise your candle store’s grand opening. Spread flyers around your town, so people know to check out your business on opening day. Be sure to include some great art and maybe have a few samples ready to go, too.
Final Thoughts: How To Start A Candle Business
At this point, if you’ve used this guide, your candle business is ready to go, and you can be your own boss. So craft those scented candles, take a deep breath, and sell!