Is Candle Making A Profitable Business?

Candle Making Business

Candle making is very popular and one of the best small business ideas that you can start from your home. The candle-making business has low startup costs, requires less equipment, and has a high demand. It’s a great way for entrepreneurs to earn extra money or can make it a full-time income. Nowadays many people are showing interest in candle making business and they want to know the profit margin of this business

Without a doubt, candle-making is a profitable business. A statistic showed about 70% to 80% of U.S. households use candles and it worth about $2 billion annually. So the demand for candles is high and you can generate a handsome amount of profit from this business. Moreover, industry experts predicted that the candle-making business will grow at a CAGR of 5.5% from 2019 to 2027. Therefore, if you plan properly then the candle-making business could change your fortune.

Market Potential Of A Candle Making Business

Market Potential Of A Candle Making Business

Before you decide whether you should start a candle-making business or not, let’s check the market potential of this business. One of the advantages of the candle-making business is, the cost of making a candle is less and it has a better profit margin compared to other consumer products. Moreover, the market potential of the candle is vast and people now use candles as beauty products, home décor, etc. So the application of candles is increasing and so does the market potential of this business. We can define the market potential of candle making business – 

Based On Wax

1. Paraffin wax: It has no additives

2. Soy wax: 100% natural wax

3. Palm wax: 100% natural wax 

4. Beeswax: 100% natural wax 

5. Granulated wax: This wax is used for crafting

6. Gel-based wax: It has a translucent quality of gelatin

Based On Type Of Candle

1. Pillar candles

2. Container candles

3. Votive candles

4. Tea light candles

5. Taper candles

6. Tarts

4. Gel candles

Based On Uses Of Candles

1. Can be used for home decoration

2. Can be used for aromatherapy

3. Can be used for illuminating

4. Can be used as a complementary element when using face masks

5. Can be used in chandeliers

How To Start A Candle Making Business

You can easily start a candle-making business with a small budget from your home. There are some basic steps to start a candle-making business. They are – 

1. Learn how Candles are Made

2. Licenses and Permits for the Business

3. Choose a Business Structure

4. Types of Products you will Sell

5. Business plan for Candle Making Business

6. Raw Materials for Candle Making Business

7. Equipment for Candle Making Business

8. Find Places to Sell Your Candles

9. Promote the Business

Learn How Candles Are Made

The first step of this business is to learn how candles are made. The design and shapes of a candle play a very important role so you have to learn how to make various shapes and designs for a candle. You can learn how to make perfect candles in person from the experts, or by taking online classes. You can also watch various videos on youtube to develop your skills. While making a candle you have to ensure that the candle burns from start to finish with a pleasant, strong scent. Moreover, the candle must burn evenly with no residue left on the sides of the jar. So there are some technical aspects of candle-making that you have to learn before you can start the candle-making business. 

Licenses And Permits For The Business

If you want to start your own candle-making business then you will need licenses, permits, and other legitimate business documentation depending on what state you are planning to open the business. You can consult with professionals or lawyers to learn what permits you need to take while starting and running a candle-making business. Usually, license and permits required for candle making business are – 

1. Company Registration

2. GST Registration

3. PF Registration

4. ESI Registration

5. Pollution Certificate

6. SSI Registration

7. Trademark Registration

8. Insurance

9. Business License

10. Trade license

11. MSME registration       

Choose A Business Structure

There are different types of business structures available. The most common structure types are:

1. Sole proprietorship

2. Partnership

3. Limited liability Company (LLC)

4. Corporation

If you create a legal business entity like LLC or corporation then they will protect you from being held personally liable if your candle-making business is issued. You can easily start an LLC by paying the minimal state LLC costs or hire a Business Formation Service for a small additional fee. Moreover, different states provide various options for forming a company. For example, forming a sole proprietorship will cost you less compared to other business structures; however, LLC will provide various extra facilities with some extra cost.

Types Of Products You Will Be Selling  

Like all businesses, the success of a candle-making business also depends on finding and focusing on the right product. A candle is available in different types by nature and it can be used for a variety of purposes. So you have to decide what type of candle you should make and sell. You should research the market demand for candles and decide whether you should make a normal candle or a creative scented candle as a decor item. Moreover, you have to determine the size, color, shape, design, scents, of the candles that you will be making.       

Business Plan For Candle Making Business

You will need a comprehensive business plan for your candle-making business. Your business plan must contain detailed information on the niche, target audience, target market, production cost, public relations plans, etc. It’s not necessary to make a huge business plan. You can start planning a part of the business at a time. You can start with writing down the business goals first, then you can write down the strategies and action steps and your business plan become real. If you are planning to start the candle business from home or on a small scale then you won’t require a big formal business plan. You just need to explore some basic aspects like – 

1. Target Market

2. Startup & Recurring Costs

3. Financial Analysis

4. Business name and brand value

Raw Materials For Candle Making Business

In order to make candles, you will require different types of raw materials that include – 

1. Wax: paraffin, gel, ay, beeswax

2. Wicks

3. Tins, jars, etc.

4. Essential oils, for fragrance

5. Coloring agents

6. Packaging supplies

7. Labels

Equipment Required For Candle Making Business

There are few types of machinery required to set up a candle-making business. They are – 

1. Wax heating machine

2. Candle thread cutting machine

3. Mixer/grinder

4. Molding machine, or

5. Manual candle making machine

6. Semi-automatic candle making machine

7. Fully automatic candle making machine

Find Places To Sell Your Candles

Once you set up your business and start making candles the next step is to find the nearby wholesalers and retailers and introduce your candle items to them. You can also contact various home decor stores, gift stores, and grocery stores as they are also your potential buyers. Moreover, you can also sell the candles online. There are many online marketplaces available like Amazon, eBay, Etsy, etc. where you can open your online candle store and sell your candle products.   

Promote The Business

The candle-making industry is competitive so you have to create brand awareness for your candle-making business. You can do social media marketing, various ads campaign to increase the brand value of your business. You can also create a business website and sell your candles online. Moreover, register your business with B2B portals to get online leads.

FAQs About Candle Making Business

1. Who Are The Target Customers For A Candle-Making Business?

The use of candles is increasing every day and so does the target customers for this business. Some of the target customers for a candle making business are – 

1. Antique stores
2. Décor store
3. Aromatherapy centers
4. Meditation and retreat centers
5. Religious requirements
6. Beauty stores
7. Social media beauty influencers
8. Rural consumers

2. How Much Money Do You Make Selling Candles?

The candle-making business has lower overheads and advertising costs therefore it has higher profit margins. So, a new candle maker can expect to earn between $500 and $1,000 per month. Homemade candle makers can expect to make between 50% to 70% profit margins on their candles.

3. How Much Does It Cost To Start A Candle Business?

The starting cost of a candle-making business is less compared to other small businesses. If you are making candles from your home then the common costs are raw material costs and equipment costs. You can easily start a small candle-making business with a capital of $700 to $1000.

4. What Type Of Candles Sells Best?           

Candles are available in various types and some of the bestselling candle types are – 

1. Soy candles 
2. Paraffin candles
3. Decorative candles
4. Aromatherapy candles
5. Blended wax candles, etc.

5. How Can I Make My Candles Smell Stronger?

Making a candle smell stronger is not an easy task. However, there are some effective steps that you can follow to make your candle smell stronger, they are –

1. Choose the right candle
2. Add the right fragrance oil
3. Use the right amount of fragrance oil
4. Add fragrance at the right temperature
5. Use the right wick
6. Store candles properly

Last Updated on June 20, 2021 by Musa D

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