Day 15 - Cost Estimations

One of the trickier parts of starting a new business is knowing how much inventory you need to stock of raw materials before you can go into meaningful production of your product - in this case, soap. Take some time to identify which oils, dyes, and scents you intend to use with your soap. Track down suppliers and how much they charge per unit weight or volume for the raw materials you need. Using your soap recipe and the factor-label method, plot out how much you would need per palette of soap.

Start by reading this article on modern soapmaking to give you a foundational understanding of how to calculate these numbers. Refer to the research you have already done elsewhere in this business plan, and chart out your batch costs.

As you work on this, consider what resources you might be able to obtain more cheaply than the competition. Do you have any connections in the industry you might be able to leverage? Do you have a way of using waste oils to make your soap?