YOU GUYS!!! I'm about a year into making candles (7 months into selling) and I'm eagerly trying to plan my escape from my day job into doing this full time... this is so amazingly helpful!!! Thank you so much. This is all info that I havent heard before (outside of the COGS calculation) ... factoring in my labor, overheads, etc. omg I cannot thank you enough!
I really appreciate this breakdown. You guys share a lot of really excellent information--especially about forecasting and estimating overhead. So many people in this space overlook the truly business-oriented aspects of these calculations, particularly at scale. I wanted to check with you on the COGS math, though--from your fragrance load calculation, you're actually adding .9oz of EO, so your Raw Material quantity should also be .9, not the .09 indicated in the note (because it's 10% of overall volume, not 10% of an ounce), correct? Also, to get the Product Price for each material line, shouldn't you be multiplying the Raw Material Quantity by the Raw Material Price to find the Product Price, rather than the Product Price by the Raw Material Price? I promise I'm not trying to be pedantic, I just want to be sure I'm understanding the way you're figuring things in your example.
I was watching the vid to help learn where to get my costs but noticed your essential oil calculations are incorrect. You have .09 instead of .9 like in your image making your essential oil cost go up a lot more
Hi Hilary! No, we don't constantly change our sales prices, but our COGS for each candle are changing with every PO. This helps us understand the change in our margins as time goes on and lets us know when we will need to make a price change. This is one of those situations in an inflationary environment that the business "eats" the rising costs until they deem it necessary to pass those higher costs on the their customers. If you want to discuss further, we are starting to do some consulting from a business side of things. Thanks for the question!
YOU GUYS!!! I'm about a year into making candles (7 months into selling) and I'm eagerly trying to plan my escape from my day job into doing this full time... this is so amazingly helpful!!! Thank you so much. This is all info that I havent heard before (outside of the COGS calculation) ... factoring in my labor, overheads, etc. omg I cannot thank you enough!
We are so glad it was helpful for you! Best of luck in your candle business!! You got this!
I really appreciate this breakdown. You guys share a lot of really excellent information--especially about forecasting and estimating overhead. So many people in this space overlook the truly business-oriented aspects of these calculations, particularly at scale.
I wanted to check with you on the COGS math, though--from your fragrance load calculation, you're actually adding .9oz of EO, so your Raw Material quantity should also be .9, not the .09 indicated in the note (because it's 10% of overall volume, not 10% of an ounce), correct? Also, to get the Product Price for each material line, shouldn't you be multiplying the Raw Material Quantity by the Raw Material Price to find the Product Price, rather than the Product Price by the Raw Material Price? I promise I'm not trying to be pedantic, I just want to be sure I'm understanding the way you're figuring things in your example.
What if you’re not making your own candles but rather retailing someone else’s?
I was watching the vid to help learn where to get my costs but noticed your essential oil calculations are incorrect. You have .09 instead of .9 like in your image making your essential oil cost go up a lot more
noticed this also 👍
I need to borrow your husband! I’m curious about your software program. So, are you constantly changing your prices? Thanks!
Hi Hilary! No, we don't constantly change our sales prices, but our COGS for each candle are changing with every PO. This helps us understand the change in our margins as time goes on and lets us know when we will need to make a price change. This is one of those situations in an inflationary environment that the business "eats" the rising costs until they deem it necessary to pass those higher costs on the their customers. If you want to discuss further, we are starting to do some consulting from a business side of things. Thanks for the question!