An incense business plan sets out the scents you'll make and who buys them, what a pack costs and sells for, the claims to stay away from, and the first year month by month. Incense is cheap to make in batches: unscented sticks dipped in fragrance oil and dried, or cones rolled from a wood powder base, a couple of dollars a pack in materials. The fragrance oil is the biggest material cost, and batch dipping is what keeps the minutes down, which matters most for packs sold to shops at a wholesale price. In the example below, an incense maker in Asheville sells stick packs direct and to shops, hand-rolled cones and holders, makes a profit from month 2, and ends the year about $18,900 ahead on $54,200 of sales, after paying $20 an hour for the making. 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 scents, the forms, where you sell, the goals.
- Cost a pack: stick blanks or cone powder, fragrance oil, the tube or box, your minutes, the fees.
- Dip in batches of hundreds; minutes per pack decide whether wholesale pays.
- Sell direct for the margin, to shops for the volume, and add holders as a bought-in extra.
- Describe the scent, not what it does for sleep or stress; health claims can make a product a drug.
- Startup is small: fragrance oils, racks, packaging and a market display.
- TaroStack keeps fragrance oils, blanks and every scent costed. More below.
Part 1: the business description
Blue Ridge Smoke Incense, a made-up incense maker in Asheville, North Carolina, I use in these examples, writes:
Blue Ridge Smoke Incense hand-dips incense sticks and rolls cones in twelve scents, sold at markets and online, and wholesale to gift shops, yoga studios and bookstores, with ceramic holders from a local potter.
Part 2: what a pack costs
| Per unit | Stick pack, direct | Stick pack, to shops | Cones, box of 12 | Holder, bought in |
|---|---|---|---|---|
| Stick blanks, or cone powder and resins | $0.60 | $0.60 | $1.20 | |
| Fragrance oil and base | $1.10 | $1.10 | $0.80 | |
| Tube or box, with label | $0.45 | $0.45 | $0.60 | |
| Dipping, drying, rolling and packing, at $20 an hour | 2 min, $0.67 | 2 min, $0.67 | 5 min, $1.67 | |
| Ceramic holder from the potter | $4.50 | |||
| Selling fees, or case share | $0.48 | $0.05 | $0.60 | $0.72 |
| Variable cost | $3.30 | $2.87 | $4.87 | $5.22 |
Twenty sticks take about 10 ml of fragrance oil with a little base, the biggest material in the pack. Dipping a few hundred sticks at once, drying them on racks and packing in a run is what brings a pack to 2 minutes; dipped one bundle at a time, it would be several times that. How to cost the tube and label properly is in packaging cost per unit.
Part 3: customers and prices
| Product | Price | Variable cost | Contribution | Margin | A month at full speed |
|---|---|---|---|---|---|
| Hand-dipped incense, pack of 20 sticks, direct | $8.00 | $3.30 | $4.70 | 58.8% | 400 |
| Incense stick packs to shops | $4.25 | $2.87 | $1.38 | 32.5% | 600 |
| Hand-rolled cones, box of 12 | $10.00 | $4.87 | $5.13 | 51.3% | 150 |
| Ceramic incense holder, bought in | $12.00 | $5.22 | $6.78 | 56.5% | 60 |
A shop pack leaves $1.38, less than a third of a direct one, and only because batch dipping keeps it at 2 minutes; at 5 minutes a pack it would leave 38 cents. Shops are the volume and the reach, markets and online the margin. How to set a wholesale price a shop will accept is in how to price handmade items for wholesale.
Part 4: the claims
Incense sells on scent and mood, and the line to stay behind is health. Under FDA's intended-use test, a product marketed with claims such as helping the user sleep can be treated as a drug, and FDA gives the example of a fragrance sold with "aromatherapy" claims that it will help the consumer sleep or quit smoking (FDA). So the plan's labels and listings describe the scent and the mood, "warm sandalwood and cedar," and leave out "relieves anxiety" or "helps you sleep." Every pack also carries a burn-safety warning: never leave burning incense unattended, burn in a holder on a heat-safe surface, keep away from children and pets. This is general information, not legal advice.
Part 5: the first year, month by month
Fixed costs are $625 a month: a studio share ($150), market fees ($150), marketing and samples ($200), 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 | Stick packs, direct | Stick packs to shops | Cones | Holders | Sales | Profit | Cash, year to date |
|---|---|---|---|---|---|---|---|
| 1 | 60 | 90 | 23 | 9 | $1,200 | −$40 | −$40 |
| 2 | 80 | 120 | 30 | 12 | $1,594 | $152 | $112 |
| 3 | 100 | 150 | 38 | 15 | $1,998 | $349 | $461 |
| 4 | 120 | 180 | 45 | 18 | $2,391 | $540 | $1,001 |
| 5 | 160 | 240 | 60 | 24 | $3,188 | $929 | $1,930 |
| 6 | 200 | 300 | 75 | 30 | $3,985 | $1,317 | $3,247 |
| 7 | 240 | 360 | 90 | 36 | $4,782 | $1,706 | $4,952 |
| 8 | 280 | 420 | 105 | 42 | $5,579 | $2,094 | $7,046 |
| 9 | 320 | 480 | 120 | 48 | $6,376 | $2,482 | $9,529 |
| 10 | 360 | 540 | 135 | 54 | $7,173 | $2,871 | $12,400 |
| 11 | 400 | 600 | 150 | 60 | $7,970 | $3,259 | $15,659 |
| 12 | 400 | 600 | 150 | 60 | $7,970 | $3,259 | $18,918 |
The year's sales are $54,206 and the profit $18,918, on top of $20 an hour for the making. Fragrance oil is the cost to watch: a supplier raising oil 20% adds 22 cents to every stick pack, 16% of a shop pack's contribution. A supplier price tracking template shows the creep.
Part 6: the startup budget
| Item | Example |
|---|---|
| Dipping trays and drying racks | $300 |
| Fragrance oil library | $800 |
| Unscented stick blanks, first order | $300 |
| Cone molds and powders | $250 |
| Tubes, boxes and labels, first order | $500 |
| Label design | $300 |
| Market display | $450 |
| Website | $200 |
| Working cash | $1,500 |
| Total to start | $4,600 |
Get the template
Download the incense 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
Twelve scents from fragrance oils bought from three suppliers, stick blanks by the thousand, tubes and boxes by the case, ten shops reordering, a market and an online shop. A sheet can't say how much sandalwood oil is left for the next batch, what a pack costs at this month's oil price, or which scents earn their place.
How TaroStack does it
TaroStack keeps fragrance oils, blanks and every scent costed.
Supplies in stock. Each fragrance oil, stick blank, powder and tube is an item, counted on a phone and kept at what you paid, and units convert: oil bought by the 16-ounce bottle, used by the milliliter; blanks by the thousand, used by the pack.
Scents as recipes. Each scent is a recipe of its blanks, oil, base and tube, so recording a batch takes them off stock at what you paid and gives the cost of a pack. Shop reorders are sales orders that show whether the packs are on the shelf while you're still typing.
And what each scent earns. A price-creep report per supplier shows whose oil prices are rising, the reorder list works in days of cover, and margins are reported by product and by customer.
| The job | Notebook | In TaroStack |
|---|---|---|
| Sandalwood oil left for the next batch | Hold the bottle to the light | Stock by item, in milliliters |
| What a pack costs at this month's oil price | Last year's number | Each batch, at what it used |
| Whose oil prices are rising? | Noticed on the invoice | Price creep by supplier |
| Which scents earn their place? | A feeling | Margins by product |
Recipes, batches, 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.