To price a tube of lip balm you add up its full cost first: the beeswax, butters, oils and tubes by the batch, your time at an hourly rate, the label, and a share of overhead like rent and power. That's what one tube costs you. Then set the price so that, after card and selling fees, it leaves the margin you want: price = full cost ÷ (1 − margin − fee rate). For a 0.15-ounce tube of lip balm that costs $0.89 to make, a 75% margin after 3% fees means $4.06, rounded up to $4.50. The tube costs more than the balm in it, and your time costs more than both; a filling tray that fills 100 at once lowers the cost more than cheaper wax. Shops pay about half of retail, so the retail price has to leave room for it. In the example below, a Pennsylvania apothecary prices its peppermint lip balm for markets and gift shops.
The short version
- Full cost = wax, butters, oils and tubes a tube + your time + label + overhead.
- Price = full cost ÷ (1 − margin − fee rate).
- Count your time at a real hourly rate, even if you don't pay yourself yet.
- Time the pouring, capping and labeling: it's nearly half the cost.
- Leave out SPF and healing claims; those make a lip balm a drug.
- Check what wholesale leaves after full cost before saying yes.
- TaroStack keeps beeswax, butters, oils and tubes counted and costs every batch. More below.
What goes into a tube's cost
| Part | How to count it |
|---|---|
| Wax, butters, oils and tubes | The batch's cost ÷ tubes a batch |
| Your time | Hands-on minutes for the batch ÷ tubes × your hourly rate |
| Label | Per tube |
| Overhead | Rent, power, tools, spread over the tubes you make |
| Fees | Card and market fees as a share of the price |
What each tube keeps over a year is in lip balm profit margin, and what goes on the label in cosmetic labeling requirements.
An example: a tube of lip balm
Elder & Oak Apothecary, the made-up apothecary in Pennsylvania I use in these examples, pours 8-ounce batches that fill 50 tubes:
| An 8-ounce batch, 50 tubes | Amount | Cost |
|---|---|---|
| Beeswax | 0.15 lb | $1.80 |
| Shea butter | 0.15 lb | $1.20 |
| Coconut oil | 0.1 lb | $0.50 |
| Sweet almond oil | 0.095 lb | $0.95 |
| Peppermint flavor oil | 0.005 lb | $0.16 |
| Tubes | 50 | $12.50 |
| A batch | $17.11 |
| A tube | Cost |
|---|---|
| Wax, butters, oils and tubes, $17.11 ÷ 50 | $0.34 |
| Time, 60 minutes for the batch at $20 an hour ÷ 50 | $0.40 |
| Label | $0.10 |
| Overhead | $0.05 |
| Full cost | $0.89 |
At a 75% margin after 3% card fees, the price is $0.89 ÷ 0.22 = $4.06, so $4.50. At $4.50 a tube, each leaves $3.47. It sells at $5.00 at markets, a round number, which leaves $3.96. Gift shops pay $2.50, half of retail, which leaves $1.53 a tube. How long a tube keeps, and the date it carries, is in lip balm shelf life.
Get the calculator
Download the lip balm price calculator. One sheet: type the batch's supplies, amounts and costs, the tubes it makes, the hands-on minutes, the label and overhead, your hourly rate, card fees and the margin you want; the full cost, the price for your margin rounded up, and what a wholesale price and a test price leave fill in. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
The calculator prices one flavor on paper. Six flavors with different oils, tubes that went up two cents, and a gift set of three change what each tube really cost.
How TaroStack does it
TaroStack keeps beeswax, butters, oils and tubes counted, and costs every batch.
Supplies in their units. Beeswax bought by the pound is used by the ounce, and tubes by the each.
Designs as recipes. Each flavor is a recipe of its supplies, so a batch takes them off stock and is costed from what they cost, and good and rejected pieces are recorded.
Reordering. Supplies come up on a reorder list in days of cover, worked out from how fast they're used.
| The job | Spreadsheet | In TaroStack |
|---|---|---|
| Supplies on hand | Count the shelf | Stock in its own units |
| What a batch cost | Prices you type | Costed from what you paid |
| Tubes that didn't fill right | Not counted | Good and rejected on each batch |
| When to reorder | When it's low | Reorder list in days of cover |
Recipes, units, costing and reorder lists 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.