Cleaning Products Business Plan, With a 12-Month Projection

A cleaning products business plan sets out the products you'll make and who buys them, what a pouch or bottle costs and sells for, the label rules, and the first year month by month. Household cleaners have a quirk most handmade products don't: the ingredients are cheap and the packaging isn't, so a glass spray bottle can cost four times what's inside it. The other thing to plan around is one word. A cleaner that cleans is an ordinary product; one that claims to kill germs is a pesticide under federal law and has to be registered with the EPA before it's sold. In the example below, a maker in Minneapolis sells laundry powder direct and wholesale, an all-purpose spray, and gallons of concentrate to refill shops, reaches 790 units a month by month 11, makes a profit from month 1, and ends the year about $41,600 ahead on $79,000 of sales, after paying $20 an hour for the making. Below is a description example, each part of the plan, the label rules, the projection, the startup budget, and a free template.

The short version

• Describe the business in a paragraph: the products, where you sell, the workshop, the goals.
• Cost each unit with your time in it; the bottle or pouch is often the biggest part.
• Price direct, wholesale and refill separately.
• Keep the claims to cleaning: "kills germs" or "disinfects" makes it a pesticide that needs EPA registration.
• Check whether an ingredient's hazards need a warning on the label.
• Budget for packaging minimums: pouches, bottles and triggers come by the case.
• TaroStack keeps formulas, ingredient lots and every batch together. More below.

Part 1: the business description

Blue Door Cleaning Co., a made-up household products maker in Minneapolis, Minnesota, I use in these examples, writes:

Blue Door Cleaning Co. makes laundry powder, an all-purpose cleaner and dish soap bars in small batches, sold at markets, online, wholesale to gift and grocery shops, and in bulk to refill shops. Every pouch and bottle carries a batch code. In our first year we plan to supply 15 shops and 4 refill shops.

The batch code is what turns a complaint about one pouch into a question about one batch; how to set up codes is in how to create lot numbers.

Part 2: what a unit costs

The spray is the clearest case: 60 cents of cleaner in $2.70 of glass, trigger and label. That's what makes refill worth selling. A refill shop buys a gallon jug, its customers bring their own bottles, and you sell the cleaner without paying for the glass. How to cost the packaging properly is in packaging cost per unit.

Part 3: customers and prices

A wholesale pouch leaves $5.02, well under half a direct one, but a shop sells it every day you're not at a market. A gallon of concentrate leaves more than any single product, because there's no bottle in it. How to set a wholesale price a shop will accept is in how to price handmade items for wholesale.

Part 4: what the label can say

Cleaning, not killing germs. Federal law treats anything intended to prevent, destroy or mitigate a pest as a pesticide, and with few exceptions it has to be registered with the EPA before it can be sold (EPA). Bacteria, viruses and fungi on surfaces count: sanitizers and disinfectants are antimicrobial pesticides (EPA). The EPA judges what a product is for by its claims as well as what's in it and how it works, so "cleans," "cuts grease" and "lifts stains" keep a cleaner a cleaner, and "kills 99.9% of germs," "disinfects" or "antibacterial" don't, even with the same ingredients.

Warnings where an ingredient needs them. A household product that's corrosive, an irritant, toxic or flammable is a hazardous substance if it may cause substantial injury or illness in customary or reasonably foreseeable use, a child getting into it included, and its label needs a signal word, "DANGER" for the worst, "WARNING" or "CAUTION" for the rest, a statement of the hazard, what to do about it and first aid (16 CFR 1500.3). Washing soda and oxygen bleach can irritate eyes, so whether your laundry powder needs a warning is worth settling, from your ingredients' safety data sheets and with someone who does this for a living, before the first label is printed. This is general information, not legal advice.

Part 5: the first year, month by month

Fixed costs are $725 a month: workshop rent ($350), market fees ($150), marketing and samples ($100), insurance ($50), the website and online shop ($40), and software and card fees ($35). Sales start at 15% of full speed and reach it by month 11:

The year's sales are $79,030 and the profit $41,648, on top of $20 an hour for the making. The hard part isn't the margin, it's the 790 units a month: 15 shops and four refill shops reordering, and two markets a week.

Part 6: the startup budget

Packaging is the biggest line because it comes by the case: a first order of glass bottles and triggers is hundreds of units whether you sell 30 sprays in month 1 or 300.

Get the template

Download the cleaning products business plan workbook. Four sheets: your products with price, variable cost and monthly volume at full speed; the year, month by month, with sales, profit and cash; your fixed costs; and your startup budget with working cash. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.

Where this stops working

Three products, a dozen ingredients and five kinds of packaging, sold four ways, are more than a notebook keeps straight. A refill shop orders four gallons the week the jugs run out, the cost of a spray is still last year's glass price, and when a customer writes that a pouch made their eyes water, the batch code leads to a page that doesn't say which lot of washing soda went in.

How TaroStack does it

TaroStack keeps the formula, the lots and the batches together.

Formulas with versions. Each product is a recipe, every ingredient by weight, with its pouch, bottle or jug and label, and units convert: washing soda bought by the 50-pound bag, weighed by the gram. A change to the formula is a new version, and every batch records which one it was made to.

Batches with their lots. Recording a batch takes ingredients and packaging off stock from the lots used, at what you paid, and notes which lots went in automatically, so the cost of a spray follows the price of glass. Every batch goes into a lot with its code, and one report goes from a pouch's code to its batch, its ingredient lots and every customer who got it.

And the shops' orders. Shop and refill orders are sales orders that show whether the stock to fill them is on the shelf while you're still typing, the reorder list works in days of cover against each supplier's lead time, so the jugs don't run out, and margins are reported by product and by customer.

Recipes, batches, lots, sales orders and margins by product and customer are on every plan, from $49 a month. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.

Questions people also ask

Is a cleaning products business profitable?

It can be. In the example, a maker selling laundry powder direct and wholesale, an all-purpose spray and gallons of concentrate for refill shops ends the first year about $41,600 ahead on $79,000 of sales, with $20 an hour paid for the making.

Do I need a license to sell homemade cleaning products?

There's no federal license for a cleaner that only claims to clean, though state and city business licenses apply. A product that claims to kill germs, disinfect or sanitize is a pesticide and must be registered with the EPA first, and a hazardous one needs warnings on its label.

How much should I charge for homemade laundry detergent?

Work out the full cost of a pouch, ingredients, packaging and your time, and price direct and wholesale separately. In the example, a 2 lb pouch costing $5.37 sells for $18 direct and $10 wholesale.

How much does it cost to start a cleaning products business?

In the example, about $5,950: $3,450 for a mixer, scales, ingredients, packaging, label design, a market setup and a website, and $2,500 of working cash.