Small Batch Production: Meaning, Examples, and the Costs

Small batch production means making a product in limited runs, a few dozen or a few hundred units at a time, usually by hand or with small equipment, rather than continuously on a line. Food, drink, cosmetic and craft businesses usually start this way: a pan of fudge, a pot of jam, a tray of soap, a pour of candles. It suits makers because it keeps stock low, lets you change a recipe next week, and keeps the product fresh. Its cost is in the setup: every batch has the same weighing, cleaning and paperwork whether it makes 19 bars or 76, so small batches cost more per unit. In the example below, doubling a soap batch from 19 to 38 bars cuts the cost per bar from $3.85 to $3.06; doubling again to 76 cuts it to $2.60, but for a scent that sells 20 bars a month, it also means almost four months of stock in the racks. Below is what small batch production is, examples, the trade-off in numbers, and the records it takes.

The short version

• Small batch production makes products in limited runs, often by hand, instead of on a continuous line.
• It suits food, drink, cosmetics, candles and crafts, especially at the start.
• Advantages: low stock, fresh product, quick recipe changes, room to test.
• The cost: setup and cleanup time spread over fewer units, so a higher cost per unit.
• Bigger batches lower the cost per unit and raise the stock you carry; the right size sits between.
• More batches means more lots to track, and every one needs its record.
• TaroStack is built for small batch makers: every batch costed, every lot recorded. More below.

Examples of small batch production

Small batch against mass production

Small batch isn't only a starting point. Some makers stay small batch on purpose, because freshness, variety or "made in small batches" on the label is part of what customers pay for.

What batch size does to cost and stock

Hoʻola Botanicals, a made-up skincare maker I use in these examples, makes cold process soap. Oils and lye cost the same per bar at any batch size, but the weighing, mixing, cleaning and paperwork take nearly as long for a big batch as a small one:

The first doubling saves 79 cents a bar and leaves under two months of stock: an easy yes. The second saves another 46 cents but puts almost four months of one scent in the racks, with the money in it and the risk that the scent stops selling. The right batch size is where the saving per unit stops being worth the stock. How to work it out for your own products is in batch size calculator, and the two ways to set it, making exactly what's needed or a fixed batch, are in lot for lot vs fixed batch size.

The records small batches take

Small batches mean many batches: three a week is about 150 a year, each one a lot with its own date, its own ingredient lots and its own yield. That's the part of small batch production that's easy to skip and hard to fix later. For each batch, keep:

• the recipe and its version,
• the lot of every ingredient and packaging item used,
• what came out good, against what the recipe planned,
• the batch code and best-by date on the label,
• any checks, like pH, temperature or a cure date.

Those records are what let a small maker answer a buyer's traceability question, cost a product honestly, and find a recalled ingredient in minutes. What a batch record holds, with an example, is in what is a batch record.

Where this stops working

On paper, small batch production produces paper: 150 batch sheets a year, each with a cost worked out once, if at all. The cost per bar in the price list comes from the first batch ever made. Nobody knows which scents are sitting in the racks for four months, and the batch that came out at 16 bars instead of 19 is in nobody's numbers.

How TaroStack does it

TaroStack is built for small batch makers: many short runs, each costed, each traceable.

Every batch, recorded. Each product is a recipe with versions and sub-recipes, and units convert: buy oils by the gallon, use them by the gram. Recording a batch of any size takes each ingredient off stock from the lots used, notes them automatically, and puts the good units into a lot with its code and dates.

Every batch, costed. The cost of each batch, at what you paid for its lots, is divided by what came out good, so a batch that made 16 bars costs more per bar than one that made 19, and you see it. Actual cost sits against the recipe's standard cost, and recipe truth checks whether a recipe yields what it claims.

And the stock, in view. Stock that isn't moving shows how long since it last went out, so the scent with four months in the racks is visible before you make more. A curing batch can sit on hold until it's ready. Margins are reported by product and by customer.

Recipes, batches, lots, holds and true cost 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 does small batch production mean?

Making a product in limited runs, usually by hand or with small equipment, a few dozen or a few hundred units at a time, instead of continuously on a production line.

What are examples of small batch production?

A pot of jam, a mold of soap, a pour of candles, a bakery's daily mix, a kettle of hot sauce, a batch of face cream. Small food, drink, cosmetic and craft businesses usually make this way.

What are the advantages and disadvantages of small batch production?

Advantages: low stock, fresh product, quick recipe changes and room to test. Disadvantages: a higher cost per unit, because each batch's setup is shared by fewer units, and more batches to record.

How do I choose a batch size?

Find where the saving per unit from a bigger batch stops being worth the extra stock: the money tied up, the shelf space and the risk it doesn't sell before its date.