This was a big year for our little candle company. It’s hard to believe we’ve been at this for 8 years! 💕

If you’re new here, this is our “behind-the-scenes” look at running a small home business. Much of the success I’ve had has come through the generosity of others, so I wanted to give back with some transparency. Hopefully this will prove helpful to anyone thinking about doing something similar.

Sales

We sold about 620 candles this year.

An overwhelming numbers of candles sold (and profit made) this year was wholesale to other resellers or as custom collaborations with other businesses for promotional items or gifts. This accounted for nearly 85% of the candles we sold this year! And we’re excited about some even bigger collaborations in store for 2023.

Number of candles sold is a slightly different measure than it has been in previous years for us, because we also started selling sampler packs (which include 8 small 2oz. candles.) About 50 of those 620 candles were the smaller sample size.

A custom candle we poured in a customer’s branded mug made a lovely gift.

Expenses

In 2021, we took a loss — grossing $3,300 but paying $4,500 in expenses. There were several reasons for this. Jesse had recently taken a demanding job, which left him little time to contribute. Jessica had also decided to spend less time at farmer’s markets and in-person events. After that loss, we decided to get more serious about growing the business.

By contrast, 2022 was our most profitable year to date. We intentionally re-invested the profit from the wholesale and business collaborations back into the company (and have plans for even more investments in 2023).

TL;DR — we grossed about $9,000 and spent about $7,100 in 2022, which left us with about $1900 of net profit—about $3.06/candle.

Here’s the breakdown of costs:

Product: $5,724 (80%)

Our largest cost was the equipment and materials for making the candles: wax, fragrance oils, jars, lids, wicks, labels, packaging, and tools.

One challenge we faced this year getting custom labels for our wholesale collaborations in a way that’s affordable, flexible, and timely while still providing a look that set our candles apart. We experimented and managed to pull off something our partners were happy with; but it’s something we’d like to improve, especially as we consider adding different product sizes.

We also saw a significant increase in shipping costs this year. That doesn’t just impact shipping candles to customers. It also increases the cost of getting the raw materials to us. We recently found a local jar supplier that’s affordable and well within driving distance, so we’re excited about the possibilities there.

Equipment costs were especially high this year, but well-justified. We invested in some industrial-grade tools to handle the large-scale orders we did this year. In particular, we got a giant 65lb. industrial wax melter with dual-zone heating that can handle more than 50lbs of wax at a time. This saved us so much time on our big orders, and we’re excited to see how it helps us scale going forward!

Our industrial wax melter. The kids named it “Jerry.”

Packaging: $137 (2%)

We haven’t changed our packaging, and we’ve been using a lot of stock we purchased in previous years. There was some investment around the sampler pack, but this is low. Based on some early conversations we’re having around rethinking our product packaging and sizes next year, this may go up quite a bit.

Web: $426 (6%)

In late 2021, we moved from off WooCommerce to Shopify. Shopify has a monthly subscription fee, but it’s well worth it. There’s no ongoing updates or maintenance nagging for our attention. Managing the store and fulfilling orders is simple and fast. The customer experience is significantly better. It handles email newsletters, gift cards, abandoned carts, and a lot more. Shopify even gets you a reduced shipping rate — that alone pays for the service. We also use G Suite for email.

Shipping: $395 (6%)

We provide free shipping for retail online orders over $80, and those costs can really add up. Shipping was more difficult to track because of how we purchased shipping labels through Shopify, but the reduced shipping rate made it worthwhile.

Marketing: $0

We didn’t spend any money on marketing this year. We found that investing in personal relationships, connecting with existing customers, and leaning heavily on organic reach (especially for social media) worked really well. We’re planning to invest in some really beautiful merchandise next year though, so keep an eye out for that.

Fees: $222 (3%)

We pay both Paypal and Shopify a 2.9% fee plus $0.30 per transaction on all of our online shop and invoiced transactions.

Donation: $200 (3%)

We decided early on that we would donate a portion of each candle sale to charity, and this year we chose the Capital City Rescue Mission in Albany, NY. They do fantastic work helping to meet the needs of homeless people in the Capital Region, and we’re glad to support them with our business.

What’s Next

We’ve got a lot of ideas for 2023.

The Candles

In 2021, we made a big decision to retire our entire library of fragrances and introduce a brand new line-up. Some of those new fragrances sold really well, and some were flops. Our worst performers were White Sage + Sea Salt and Tonka, Spiced Honey + Cranberry. (Interestingly enough, the Tonka, Spiced Honey + Cranberry candle always sold out in stores and at in-person events — it’s a weird concept but amazing fragrance.) Perfect Christmas Tree, though, sold really well in our online store, and Black Currant Absinthe was a hit with our custom collaborations. We’re still passionate about that approach, though we may incorporate a couple of old fan-favorites from previous years.

We have a whole new line-up in the works for 2023, and we're planning to poll our community to figure out what the real fan-favorite fragrances are. We're also rethinking the overall candle experience: jars, labels, wicks, size offerings. 

Be sure to follow along on Facebook, Instagram, Twitter, or sign up for our email newsletter so you don't miss any of these updates.

Sample Pack

We sell primarily online, so we had wanted to offer a sampler pack for a long time. We finally released our 8-candle Sample Pack in 2021 with all our new fragrances, but sales have been mediocre. These packs are also finicky and time-consuming to make (8 small candles + labels), which makes them costly and not that profitable.

We’re going to rethink our sampler in 2023. We would either like to make it more affordable and less time-consuming so it can serve as a true sampler, or to package and market it more like a gift. More to come on that front.

Thank You

We honestly couldn’t have had the success we did this year without all of the incredible support from our friends and fans.  We were especially blown away by how many of you shared the love on social. Small acts of thoughtfulness like that go a lot further than you realize.

Happy New Year, friends! 🎉

We poured 150 custom candles in a single day!