Craft shows and farmers' markets are both popular venues for handcrafted soaps, or you may even decide to open your own brick-and-mortar store one day. Of course, you'll need a POS (point of sale) system, and preferably the right software to keep your inventory consistent between your online and offline sales.
Federally, there are no permits required because soap is specifically not a drug or a cosmetic, so the requirements for drugs or cosmetics do not apply at the federal level. You only have to label the ingredients.
Consumer Price Index for Handmade Soap
At the start of 2024, the US Average Consumer Price (ACP) for handmade soap was $3.59 per ounce. A 5-ounce bar of handmade soap is expected to sell for $17.95 (5 ounces × $3.59 average price per ounce = $17.95).
You don't need pre approval from the FDA in order to sell soaps and shampoos in the USA. However, you need to prove your products are stable and safe before you sell them.
Is soap-making a profitable business? Certainly! With growing demand for handmade and natural products, there's a market for unique and high-quality soaps. Success depends on factors like product quality, marketing strategy, and customer satisfaction.
If anyone besides you uses your soap or lotions, etc., you need product liability insurance. Even if a consumer does not purchase a product from you, they can and will hold you liable for the product.
High demand: Soap is a daily necessity for everyone, ensuring a steady market demand. Plus, the growing interest in artisanal, handcrafted products makes it a timely choice.
How Long Does Handmade Soap Last? You'll be amazed at just how much longer natural soap lasts than its commercially manufactured counterparts. You can expect 1-2 years in optimal conditions! The truth is, though, quality natural soap bars should be used much faster than that.
Craft shows and farmers' markets are both popular venues for handcrafted soaps, or you may even decide to open your own brick-and-mortar store one day.
Etsy doesn't require sellers to have a business license.
Any sales of products and services in the year need to be declared as “self-employment income”. You will ultimately owe taxes on the net profit of your business. This is the total amount you have made, minus all allowable business expenses.
Pure cleansing soaps don't need FDA approval. However, if you market your soaps as moisturizing or having other benefits, it becomes a cosmetic product requiring FDA approval.
Community connection: Handmade soaps can be a hit at local markets and events, helping you build a strong community presence and brand loyalty. Online sales potential: Soap is easy to package and ship, making it an excellent product for online sales and for expanding your reach beyond local customers.
Handmade soap and bath products are a great example of an easy-to-make product that can be sold on Etsy. These items are also something that people will buy as gifts for others, so it's good to have options in this category when you're browsing through the site.
While you don't need a special license to sell soap, you do need to adhere to specific FDA regulations when it comes to marketing your soap. For all of that information on what you can and cannot say (including any medical claims!), please refer to the FDA guidelines on Soap.
Handmade Soap Is Natural and Organic
This is especially important when it comes to the oils used in the soap. Handmade soap bars are made with high-quality oils, providing your skin with a rich source of vitamins and minerals. Many commercial soaps are made with harsh synthetic ingredients that can damage your skin.
For people with sensitive skin, handmade soap can be a particularly appealing option, as it is often gentler and less drying than mass-produced soap. Another group of consumers who frequently purchase handmade soap are those who are passionate about supporting small businesses and local artisans.
Neither the product nor its ingredients need approval by FDA before they go on the market, except for any color additives it contains. It is your responsibility to make sure your product is safe for consumers when it is used as intended, and to make sure it is properly labeled.
The Handmade Artisans Insurance provides business general liability coverage, including product liability coverage to artisans who make their own products by hand. This includes soap, lotion, and more. They have two options - $285 per year for up to $1,000,000 and $385 per year for up to $2,000,000.
Sell on marketplaces
You can sell soap through online marketplaces like Etsy and Amazon.
Lotions, soaps, and other cleansers may be regulated as cosmetics or as other product categories, depending on how they are intended to be used.