Sunday, January 27, 2008

Red Lychee Tea Unveiling & Economics



Here are some photos of the newly cut Red Lychee Tea soap. I'm very happy with how the batch turned out, especially the dark vibrant blue.

Colors used:

Non-Bleeding Pink Pigment (liquid) 
Non-Bleeding Blue Pigment (liquid) 
Non-Bleeding Purple Pigment (liquid)
Sparkle Gold Mica



I roughly sketched out the Profit & Loss of this loaf on the back of a napkin. The rough economics behind this loaf of soap look like this:

COG (cost of good sold) - the price you pay for the raw materials

4 pounds soap = $7.40
2 ounces fragrance = $3.00
color = $1.30


total: $11.70 for materials

Mold: suggested retail around $30; if the old is used 30 times, this works out to $1 per use

The soap loaf makes approximately 12 bars of soap. At $5 per bar, that works out to $60-$70 retail value.

Gross profit for the loaf, sold at retail, is approximately $53. Gross profit is the retail price less the COGS (materials). Afte

If fixed costs are taken out of the Gross Profit number, such as the cost of the mold ($1), wrapping ($1), overhead ($3) and labor ($15), the net profit works out to about $33.

That's a pretty good return for such a wondrous creative outlet of expression.