A hair oil business plan sets out the oils you'll blend and who buys them, what a bottle costs and sells for, the rules that depend on what the label says, and the first year month by month. Hair oil is simple to make, a blend of carrier oils and a little essential oil in a dropper bottle, and the bottle and dropper cost about half as much as the oil inside. What decides the business is the words: an oil for shine and a soft scalp is a cosmetic, and an oil that claims to restore hair growth is a drug, with rules a small maker can't easily meet. In the example below, a maker in Savannah sells 2-ounce and 4-ounce bottles direct, 2-ounce bottles to salons and shops, and scalp rollers, makes a profit from month 2, and ends the year about $23,900 ahead on $48,800 of sales, after paying $20 an hour for the filling. Below is a description example, each part of the plan, the claims, the projection, the startup budget, and a free template.
The short version
- Describe the business in a paragraph: the oils, where you sell, the workspace, the goals.
- Cost a bottle with your time in it: oils, bottle and dropper, label, filling and fees.
- Price direct and salon wholesale separately; add a small roller as the trial size.
- "Restore hair growth" makes a hair oil a drug; "adds shine" and "softens" keep it a cosmetic.
- MoCRA's small-business exemption doesn't cover safety records or reporting reactions.
- Marketing is the biggest fixed cost: customers need to try an oil to come back.
- TaroStack keeps formulas, oil lots and every batch together. More below.
Part 1: the business description
Tybee Botanicals, a made-up hair care maker in Savannah, Georgia, I use in these examples, writes:
Tybee Botanicals blends hair and scalp oils from jojoba, argan and castor oils with essential oils in small batches, sold at markets, online, and wholesale to salons and shops. Every bottle carries a batch code and a way to reach us. In our first year we plan to supply 15 salons and shops.
Part 2: what a bottle costs
| Per unit | 2 oz dropper, direct | 2 oz dropper, wholesale | 4 oz pump, direct | Scalp roller, 10 ml |
|---|---|---|---|---|
| Carrier oils and essential oils | $1.84 | $1.84 | $3.68 | $0.31 |
| Amber bottle with dropper, pump or roller | $0.95 | $0.95 | $1.40 | $0.45 |
| Label | $0.20 | $0.20 | $0.25 | $0.10 |
| Filling, capping and labeling, at $20 an hour | $0.67 | $0.67 | $0.83 | $0.33 |
| Card and platform fees, 6% | $1.32 | $2.16 | $0.54 | |
| Case share | $0.10 | |||
| Variable cost | $4.98 | $3.76 | $8.32 | $1.73 |
Two ounces is about 59 ml: carrier oils averaging $25 a liter are $1.48, and essential oils at 2% of the blend add 36 cents. The amber glass bottle and dropper are 95 cents, half of what the oil costs, which is why packaging belongs in the cost from the start; how to cost it is in packaging cost per unit.
Part 3: customers and prices
| Product | Price | Variable cost | Contribution | Margin | A month at full speed |
|---|---|---|---|---|---|
| Hair oil, 2 oz dropper, direct | $22.00 | $4.98 | $17.02 | 77.4% | 120 |
| Hair oil, 2 oz dropper, wholesale to salons and shops | $11.00 | $3.76 | $7.24 | 65.8% | 200 |
| Hair oil, 4 oz pump, direct | $36.00 | $8.32 | $27.68 | 76.9% | 40 |
| Scalp oil roller, 10 ml | $9.00 | $1.73 | $7.27 | 80.8% | 100 |
Salons are the biggest line: a stylist who uses the oil in the chair sells it at the front desk, and a salon reorders on its own. A salon bottle leaves $7.24, less than half a direct one, at no marketing cost. The roller is the trial size: a customer who likes it buys the 2-ounce bottle. How to set a wholesale price a shop will accept is in how to price handmade items for wholesale.
Part 4: the claims
Whether a product is a cosmetic or a drug depends on its intended use, shown by what the label, the website and the ads say, and claims that a product will restore hair growth are among FDA's examples of claims that make a product a drug (FDA). Rosemary hair oil is popular for exactly that reason, so the plan's labels and posts say what a cosmetic can: adds shine, softens, conditions, smells good. A customer's review that says "my hair grew back" is theirs; repeating it in an ad is a claim. Under MoCRA, a small business is excused from facility registration and product listing but not from adverse event reporting and records, or from keeping safety records, and labels need a US address, phone number or website for reactions; what counts as small is in MoCRA for small businesses. Essential oils can irritate skin, so the formula gets a safety review and the label suggests a patch test. This is general information, not legal advice.
Part 5: the first year, month by month
Fixed costs are $1,025 a month: a studio share ($150), market fees ($150), marketing, ads and samples ($600), 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:
| Month | 2 oz, direct | 2 oz, wholesale | 4 oz pumps | Rollers | Sales | Profit | Cash, year to date |
|---|---|---|---|---|---|---|---|
| 1 | 18 | 30 | 6 | 15 | $1,077 | −$226 | −$226 |
| 2 | 24 | 40 | 8 | 20 | $1,436 | $40 | −$186 |
| 3 | 30 | 50 | 10 | 25 | $1,795 | $306 | $120 |
| 4 | 36 | 60 | 12 | 30 | $2,154 | $572 | $692 |
| 5 | 48 | 80 | 16 | 40 | $2,872 | $1,105 | $1,797 |
| 6 | 60 | 100 | 20 | 50 | $3,590 | $1,637 | $3,434 |
| 7 | 72 | 120 | 24 | 60 | $4,308 | $2,170 | $5,604 |
| 8 | 84 | 140 | 28 | 70 | $5,026 | $2,702 | $8,306 |
| 9 | 96 | 160 | 32 | 80 | $5,744 | $3,235 | $11,541 |
| 10 | 108 | 180 | 36 | 90 | $6,462 | $3,767 | $15,308 |
| 11 | 120 | 200 | 40 | 100 | $7,180 | $4,300 | $19,608 |
| 12 | 120 | 200 | 40 | 100 | $7,180 | $4,300 | $23,907 |
The year's sales are $48,824 and the profit $23,907, on top of $20 an hour for the filling. The marketing line is the one to watch: if it doesn't bring direct customers, the plan leans on salons, which leave less a bottle.
Part 6: the startup budget
| Item | Example |
|---|---|
| Oils and essential oils, first order | $700 |
| Bottles, droppers, pumps and rollers, first order | $800 |
| Scale to 0.01 g | $80 |
| Funnels, pipettes and beakers | $60 |
| Label design | $350 |
| Safety review by a cosmetic chemist | $300 |
| Product photos | $250 |
| Market tent and display | $450 |
| Website | $200 |
| Working cash | $1,500 |
| Total to start | $4,690 |
Get the template
Download the hair oil 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
Five blends, oils from three suppliers bought by the liter, bottles, droppers and pumps by the case, and 15 salons reordering on their own schedules. When a customer writes about an itchy scalp, a notebook can't say which lot of rosemary oil was in that bottle, or who else got bottles from the batch.
How TaroStack does it
TaroStack keeps the formula, the lots and the batches together.
Formulas with versions. Each blend is a recipe with versions, every oil by weight, and units convert: jojoba bought by the liter, weighed by the gram. A change to the essential oil share is a new version, and every batch records which one it was made to.
Batches with their lots. Recording a batch takes the oils, bottles and labels off stock from the lots used, at what you paid, and notes the lots automatically. One report goes from a bottle's batch code to its oil lots and every customer who got bottles from it.
And the salons' orders. Salon reorders are sales orders that show whether the bottles to fill them are on the shelf while you're still typing, the reorder list works in days of cover so droppers arrive in time, and margins are reported by product and by customer.
| The job | Notebook | In TaroStack |
|---|---|---|
| Which rosemary lot is in this bottle? | Maybe in the notebook | The batch's lots |
| Who else got that batch? | Read the orders | One report, lot to customer |
| Droppers before they run out | Found short | The reorder list, in days |
| Salons or online, which pays? | A feeling | Margins by customer |
Recipes, batches, lots, recalls 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.