How to turn the Art of Soap Making into a Profitable Business

Soap is an essential cosmetic product that is an integral part of our daily personal hygiene. With more and more consumers adopting eco-friendly lifestyles, soap making has taken a conscious shift towards reducing carbon footprints and steering clear of harsh chemicals.

Many people start soap making as a hobby and use this exclusive craft to curate homemade festive hampers, return favors, and corporate gifts.

However, by putting to use your knowledge of ingredients, applying your aesthetic abilities, and stringing it with accurate marketing strategy, you can transform your soap-making hobby into a profitable business.

In this blog post, Soapy Twist walks with you through the vital strides that will help turn your soap-making passion into a profitable venture.

Step 1: Study the Market

In this world of the information highway, the internet is your best friend when it comes to studying the market. Look for people who are already in the soap-making business. Try to study and understand their strategy, their unique selling proposition (USP) their pricing, and their targeted audience.

Somewhere along this research, you will be able to identify a potential niche for yourself, it is through this niche that you can venture into the market with your unique selling proposition.

Step 2: Establish your USP

Before starting work, you must have a clear objective that answers the following questions,

What do I wish to achieve by starting my Soap making business?

How will my products be different from what is already available to the customer?

Who will be my consumer?

Where will I source my ingredients from?

What will be my packaging strategy?

How is my venture contributing to Eco-Friendly practices?

What sets my product apart?

Answering these questions will help you firm up your Venture’s USP and you will be ready to take the next important stride.

Step 3: Make a Business Blueprint

Once your business objective has been established, you need to make a clear road map to achieve these objectives. You need to create a business blueprint keeping in mind the following aspects.

Manufacturing Practices: Factory based / non-Factory based

Raw Material Partners

Packaging Partners

Pricing Structure

Marketing & Promotion Strategies

Quality checks

Deciding the first batch size

Scaling up strategy

Identifying the product mix

At this juncture, it's advisable to seek the services of a lawyer who can guide you concerning the legal aspects of setting up a handmade soap business.

Step 4: Branding & Positioning

A logo alone is not all that branding is. It is your narrative and the feelings you arouse. Your brand should reflect the principles and distinctive qualities of your product. Once your brand is distinct, include it in your packaging. Customers can be drawn in and the quality of your handmade soaps can be reinforced with imaginative, lovely, and environmentally friendly packaging.

With the help of your unique branding and creative packaging, you can position yourself exclusively. Once you have decided on your brand, it’s a good idea to get your trademark registration. This will ensure that no one else could use your brand name.

Step 5: Understand & Procure Business Compliances, Permissions, and necessary Licenses

Udyam Registration (MSME) / Solo Proprietorship Registration / Limited Liability Partnership

GST Number: GST number is mandatory if you wish to sell your product online. However, if you make a margin of less than 3 lakhs per month and are selling through private channels like your own website, WhatsApp & Social Media then this certificate is not mandatory till you start making a significant margin.

Trademark & Copyright Registration: Work with a trademark attorney and get a public trademark search done to ensure that your brand name is available.

Cosmetic License: Soap is a cosmetic used topically on the skin. Cosmetics fall under the FDA (Food and Drug Administration) Department. Every state has its own FDA department that issues the license to manufacture and sell cosmetics.

FDA reports to CDSCO where your Cosmetic License is issued. This license is mandatory if you to manufacture & sell products on a large scale.

Other certifications that may be useful to you are listed as under.

NSDC Certificate: National Skill Development Corporation, Aayush Certification

Step 6: Establish your Product Mix

Why it is essential to understand the compliances and certifications before deciding on your product mix because some compliances are product based and many like Eco Cert will quote a fee to certify one product. Therefore, keeping your budget in mind, you can decide how many products you wish to launch at first with complete certification and quality checks in place, gradually you may add to your product mix.

Always know your product mix, the choice of ingredients, the pricing strategy as well as the packaging should be aligned with your brand.

Standards for Quality

You may get your product tested for quality standards at an NABL-certified laboratory.

Furthermore, you may get your product certified by COSMOS which is an international agency that certifies your products to be "Natural" or "Organic". At the end of this process, your product can carry on their label Eco Certified 'Natural' or 'Organic'

Step 7: Identify your Shipping & Logistics Partners

Once you have your product mix in place, you need to know how you will reach these products to your end consumers. To that effect you will need to identify your logistics partners, people who will print your labels, from whom you will procure your packaging, and also people you will hire to assist in packaging. Finally, you will look at your delivery partners. Compare and analyze to establish the best courier prices on offer since many companies offer free shipping to their customers, a strategy that can strengthen your brand better.

Step 8: Establish Reliable Suppliers

It's best to buy all your raw materials directly from the manufacturer at wholesale price. Look for Bulk Suppliers who are liable. Always start by asking for samples, check their clause on MOQ (minimum order quantity), and engage with them to understand their manufacturing practices. If they are offering training programs, that is the very first step to understanding their expertise and ethos, since through their training programs you get to directly interact with them and understand their manufacturing practices.

Step 9: Building your Marketing & Promotion Systems

At this juncture, you need to formalize your marketing & selling strategy by building your systems.

1. Work on your website
2. Make your email list for promotional activities
3. Have a WhatsApp Broadcast list in place
4. Create a presence on social media with an Instagram / Facebook handle
5. Identify the various online portals that will allow you to sell your products
6. Mark on a calendar the various Exhibitions / Fairs and events that encourage you to put up a stall for direct selling

Step 10. Build your influence & never stop learning

Finally, through a diligent, consistent yet gradual process, start building your influence through marketing and promotional content like blog writing, ‘how to use’ videos, simple home remedies using your products, or videos giving a peek into how your product is getting made.

Ensure you keep your content engaging, empowering, entertaining, and educational. To that effect, keep learning and exploring the content of other players in the industry.

Further, build your capacity by engaging in newer certifications and skill-based learning programs. Try to keep your knowledge and practices up to date with the times as Cosmetic trends change fast.

Soap making is a rewarding as well as relaxing experience and can help you from becoming a soap crafter to a successful Entrepreneur.