Saturday, July 7, 2018

Producing 1000 bottles of perfume

     The original version of Creating Your Own Perfume With A 1700 Percent Markup! was about nothing more than producing 1,000 bottles of perfume (all of which were sold successfully at full price.)

    Selling 1,000 bottles of a perfume of your own can be wonderfully profitable if you've kept your production costs in check. But there are a few special issues about producing this number of bottles. You're over the limit for a "crafts" project perfume that makes use of decorative bottles that were never designed for the controlled dispensing of perfume; no spray and often no dabber.

    And you are, for the most part, under the minimum for commercial assembly by automated equipment (although you might find a contract packager willing to undertake your "small" job by doing by hand what you could do by hand yourself.)

    Producing 1,000 bottles of perfume almost begs for hands on desktop or kitchen table top assembly by you, the boss, the owner, the chief engineer, bottle washer and promoter. The "putting it together" isn't really difficult. The real hurdle is locating the components in the quantities needed. To accomplish this you must know something about each of the required components: fragrance, alcohol, water, bottles, closures, labels, and boxes.

    The fragrance itself is the most complex issue. It can be stock or custom but either way it will be a very important part of what sells your product. Obtaining the "right" fragrance is both a marketing and a creative project but, if you think you know what smell will sell, you can work out the fragrance issue.

    Alcohol and water are not major issues. Real perfumery alcohol is available if you're willing to hunt for it. You don't have to resort to substitutes such as using vodka (no!) or going for a non-alcoholic perfume (which can be fine but is not the kind of perfume I'm writing about here.)

    Bottles, in my mind, are what separates the professional/commercial perfume from the hobby project. You want to put your perfume in real perfume bottles, 1,000 of them. Your problem is finding a bottle you like available in the quantity you want (1,000 bottles) with a neck that will mate with the closure you want.

    While bottles, in small quantities, may be sold by the dozen, when you want 1,000 bottles it is unlikely you'll be able to buy this exact amount. Distributors sell bottles by the case and the number of bottles in a case is not a fixed number. The count will depend on the size of the bottle and on how much weight the manufacturer wants to pack into each case. Glass is heavy.

    To get your 1,000 bottles you'll have to buy a certain number of cases. For example, if your bottle is packed 426 bottles to the case, to get your 1,000 bottles you'll have to order three cases, which will give you 1278 bottles -- 278 more than you want. But the alternative -- ordering two cases -- would give you only 852 bottles, 148 short of what you need.

    At this point you may want to reevaluate your production quantity. 1,000 now looks like an oddball number in terns of ordering. But there is yet another issue to deal with: minimum order size. Most distributors have a minimum order size, say $500. Sometimes you can get around this by talking to the distributor heart to heart.

    Now you can go out and buy the closures, usually a spray pump and overshell. Again the offerings will not give you an exact 1,000 but here having a few extra on hand shouldn't be a problem.

    Labels offer some complications in that you'll want labels that fit your bottles and this may require ordering a custom size which will involve setup charges. You'll also confront the issue of the printing -- a simple one-color job or a multi-color job with detailed artwork. Here it's easy to see your potential cost by going to label printers' websites and getting quotes or just looking up available label sizes and costs for your 1,000 quantity.

    Finally there are the boxes. 1,000 is not a good number for boxes but, if you're planning to sell your fragrance through retailers, boxes are important. Many, perhaps most, printers have a 5,000 box minimum. There are exceptions. In all likelihood if you want a box you'll find yourself with many more than 1,000. But think positively. Your project may be a big success and 1,000 bottles could simply be a starting point that finances a larger venture.

    Vendors for all these items can be found at the Vendors pages of our website. My book about all this is Creating Your Own Perfume With A 1700 Percent Markup!

Thursday, June 7, 2018

Market testing is really important when you're trying to grow a perfume business

    In Creating Your Own Perfume With A 1700 Percent Markup! I mentioned I had done a test with a dummy product before making a $2,000 commitment to developing manufacturing our own fragrance, a men's cologne. Market testing is really important when you are trying to grow a business.

    Testing involves risking a small amount of money to get data -- data that will guide you through larger decisions. The testing mentioned in Creating Your Own Perfume With A 1700 Percent Markup! wasn't the first or the largest test I had ever done. Sometimes you don't even know you are testing but when you examine certain marketing results you realize that you have a chance to make a lot more money but it's going to involve spending more money ... and the thought of spending that money can make you uncomfortable.

    Sales results that you already have are the tool you need to make your analysis. But when the new opportunity -- or a larger opportunity -- involves doing something you've never done before, stepping off into the unknown, you have to be very clear headed about what your data really shows.

    For us, one case involved a small ad we had run in a national publication. The cost was under $1,000 and the results were profitable so the question arose, "what would happen if we ran that promotion as a full page in that publication?"

    The bait was simply that the cost per inch of space dropped dramatically as the size of the ad increased. On top of that, the publisher was offering us a deep discount on the posted ad rate.

    Calculating the sales per inch of our small ad and the number of inches we would get from the larger ad, and the cost of the small ad and the cost of the larger ad -- we decided to go with it, based on our proven results from the smaller ad.

    The commitment was scary. We would be spending ten times more money for the larger ad. Yet our data showed it to be a logical move -- and it was. The results per inch for the larger ad were several times what our results per inch had been for the smaller ad. And, not only did we receive a flood of cash orders, we received a flood of new customers, some of whom continued to buy from us for years.

    The test mentioned in Creating Your Own Perfume With A 1700 Percent Markup! was a bit different. It was suggested that our regular, loyal customers would buy a men's cologne from us. We had a print catalog that we mailed, monthly, to our customers. We bought a few dozen bottles of the same cologne a competitor was selling. It sold well but due to what we had to pay for it (too much!) and our matching our competitor's retail price (too low!), the profit was solid but not exciting.

    That all changed when we invested in our own fragrance. Our cost per bottle dropped from $7.95 to less than $1.50 while our selling price was bumped up from $14.95 to $26.95 which did not seem to deter buyers.
    To some, $2,000 might not seem like a lot of money but at the time, as our business was focused elsewhere and we had never sold a fragrance, $2,000 seemed to me like a huge leap into the unknown -- except for our test data that cried out to us, "there is profit to be made here!"

    Again, the data had the answer; we made our money.

    It's not always easy to develop a test that will give you good data. But that's no excuse for blowing off the idea of a market test and plunging into the unknown without any data to guide you.

    Test today and live to see your business grow!

    Here are three links to other articles I've written on testing:

Tips on test marketing your perfume

Test marketing your perfume

Testing — from the past