Honey Business Profit Margin: Per Jar, Pound and Hive

Honey's margin per jar is high: once the honey is in the bucket, a jar, a lid, a label and a few minutes of bottling are most of what's left to pay for. But the margin per jar is the wrong number to run the business on, because the hives, not the customers, set how much honey there is to sell. The numbers that matter are the margin per pound of honey, which says which channel deserves the honey, and the profit per hive, which says how many hives make a living. In the example below, a 12 oz jar keeps 83.4% at a market and 78.8% wholesale, but a pound of honey earns $15.56 in market jars against $4.62 sold in bulk, and each hive's 40 lb leaves about $470 a year against $120 of upkeep. Below are the three margins, the channels compared, what a year leaves, and the levers.

The short version

• Per jar: (price − jar, lid, label, bottling and fees) ÷ price. High: 78.8% to 83.4% here.
• Per jar on full cost, with the hives' upkeep spread over the honey: 53.8% to 67.3%.
• Per pound of honey: what each channel earns from the honey it uses. This decides where honey goes.
• Per hive: pounds a hive gives × what a pound earns − the hive's upkeep.
• Bulk looks good per pound sold but earns the least per pound of honey you have.
• The first year with 20 hives is close to break-even; more hives and more outlets make it a business.
• TaroStack keeps every extraction as a lot, every bottling as a batch, and margins by product and customer. More below.

Three margins

The costs come from honey business plan, for a beekeeper with 20 hives selling 12 oz jars at markets and to shops, and bulk honey to a bakery:

The jar's $1.91 is extraction, the jar, lid and label, and bottling time; the market jar adds a 3% card fee, and bulk honey carries a share of the pail. None of it includes the hives, which cost about $120 each a year whether the honey sells or not.

Spread the hives over the honey, about $3 a pound as in how to start a honey business, and the margins on full cost come out lower, and in a different order:

A 12 oz jar holds 0.75 lb of honey, so it carries $2.25 of hive cost; a pound of bulk carries $3.00.

Per pound of honey: where the honey should go

The hives make a fixed amount, so the useful question is what each channel earns from a pound of it:

A pound sold in market jars earns more than three times what it earns in bulk. Bulk still has a place, for honey that would otherwise wait, and for steady cash from one customer, but it shouldn't take honey the market or the shops would have bought.

Per hive, and per year

In the plan's mix at full speed, each pound sold leaves about $11.75. A hive giving a cautious 40 lb a year is worth about $470, against $120 of upkeep. With 20 hives and $400 of fixed costs a month, hive upkeep, two market Saturdays, insurance, the website and the vehicle, the first year ends about $88 short: at full speed, a month sells $840 and leaves $290, but the early months, before the outlets fill, cost more than they earn.

Fifty hives in the same mix would leave about $15,000 a year after their upkeep and the other fixed costs, if there were outlets for 2,000 lb of honey. That's honey's margin in one line: the jar pays well, and the business is in the number of hives and places to sell. How to price the wholesale jar is in how to price handmade items for wholesale, and the same checks across other foods are in good profit margin for a food product.

The levers

1. Send the honey where it earns most per pound: markets and shops before bulk.
2. Add outlets before hives. A hive without an outlet is upkeep with a bucket.
3. Bottle as you sell, not all at once, so cash isn't tied up in jars and labels.
4. Count every extraction as a lot, with its pounds, so you know what you have to sell, and where it went.

Where this stops working

Honey is easy to lose track of. Three extractions, a few pails, jars bottled from different buckets, and a bakery that takes whatever's left. By winter nobody can say how many pounds each extraction gave, which jars came from which, or whether the bakery's bulk took honey the market would have paid three times as much for.

How TaroStack does it

TaroStack keeps the honey on the record from the bucket to the customer.

Every extraction, a lot. Each extraction goes into stock as a lot with its date and pounds, and lot labels print with its code and best-by date, so every pail and jar can be traced back to it.

Every bottling, a batch. Bottling is a batch that takes honey off stock from the extraction lot used, with jars, lids and labels, at what you paid, and divides by the jars that came out good. Its batch record can carry your own fields with limits, like the honey's moisture reading, flagged when it's outside them. Units convert: honey in pounds, jars by the case.

And margins by product and by customer. Margins are reported by product and by customer, on what things actually cost, so the market, the shops and the bakery can be compared, and one report shows which customers got which extraction.

Lots, lot labels, batches, recipes with unit conversion 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

What is the profit margin on honey?

Per jar, high: in the example, a 12 oz jar keeps 83.4% at a market and 78.8% wholesale before the hives' upkeep. With the hives spread over the honey, 67.3% and 53.8%.

How much profit is there in a pound of honey?

It depends where it's sold. In the example, a pound earns $15.56 in market jars, $9.45 in jars sold to shops, and $4.62 sold in bulk, before hive upkeep.

How much profit does one beehive make?

In the example, a hive giving 40 lb a year is worth about $470 in the plan's mix of markets, shops and bulk, against $120 of upkeep a year. Yields vary by place, season and beekeeper.

Is selling honey profitable?

The jar is, and the business can be. In the example, 20 hives come close to breaking even in the first year; the profit comes from more hives and more outlets to sell their honey.