As a soapmaker, you already know the importance of keeping track of your ingredients, recipes, and sales. But have you ever considered tracking your inventory? Inventory management may not seem like a top priority when it comes to soapmaking, but it can have a big impact on your business.
In this blog post, we’ll discuss some reasons why you should be taking inventory management seriously if you make handmade soap products.
☞ Ready to take your soapmaking business to the next level?
Discover how Craftybase is the all in one soapmaking software you've been missing out on: track raw materials and product stock, COGS, pricing and much more. It's your new production central.
Start your 14 day free trial1. Keep up with demand and customer expectations
As a soapmaker, one of the most important things you can do is keep track of your material stock. This may seem like a no-brainer, but you’d be surprised how many soapmakers run into problems because they simply don’t know how much material they have on hand.
If you’re constantly running out of your raw materials, your production times can blow out significantly as you have to wait until your reorder arrives before you can make new batches of your soap. For Etsy sellers, missing your delivery targets can lead to losing your Star Seller rating and thus your visibility in search - this can be a Pretty Big Deal to a small handmade business.
On the other hand, if you have too much material stock due to purchasing materials that you already had enough of on hand, this can be a problem as well.
You’ll have a lot of your money tied up in raw materials that are not making you money. For soapmakers, in particular, many of these raw materials have a short shelf life: if you don’t make products before they expire this is money simply going down the drain. This is money you could have spent on growing your business in other ways, so over buying materials can definitely put the brakes on your efforts to grow.
2. Keep better control of your soap costs and pricing
Inventory tracking also allows you to keep better track of your material costs. This information can be helpful in pricing your products and making decisions about your business.
Soapmakers running successful handmade businesses are always trying to find ways to save money and increase profits, whilst ensuring they are not sacrificing the quality of their work. One easy way you can do this is by keeping better track of your raw material inventory.
By knowing the exact amounts of each raw material you use to create your soap products, you’ll be able to see how much it costs you to make your products at cost price. Cost price is the amount you can sell your soap products that cover your costs exactly, without making any profits.
Knowing your cost price means you can apply a margin to the top of this amount, meaning you know the exact profits you are taking from each product you sell.
This enables you to set prices that achieve the profit margins you need, rather than guessing a price based on your competitors (who may or may not be making money)
Guessing at prices may look like it works in the short term, but in the long run, it can lead to serious problems with inventory and cash flow. Not to mention, it can be difficult to attract customers if your prices are constantly changing.
By taking the time to calculate your costs and overhead, you can ensure that your prices are fair and consistent. This will help you to better manage your finances and keep your soapmaking business running smoothly.
Read more: 4 Pricing Mistakes Handmade Sellers Make »
3. Compliance with Good Manufacturing Practices
Soap making is not only an art, but a science. And like all good scientists, soap makers need to keep meticulous records of their work. This is especially important when it comes to keeping track of material stock.
Good manufacturing practices (GMP) require that all manufacturers maintain accurate records of the materials used in their products. This helps to ensure that products meet safety and quality standards. Soap makers need to be especially vigilant in this regard, as even small changes in the ingredients can have a big impact on the final product.
By keeping careful records of material stock and your soap batches created, soap makers can help to ensure that their products meet GMP standards and are safe for use.
Read more: How to create a batch recipe for soap
4. Enables You to Plan Ahead
Tracking your inventory allows you to plan ahead and anticipate when you’ll need to order more supplies. If you’ve just launched a new soap line and know you’ll be using a particular fragrance oil frequently, you can keep an eye on your inventory levels and order more before you run out.
This kind of proactive planning helps ensure that you always have the ingredients you need on hand and can fill customer orders in a timely manner.
5. Helps You Identify Popular Products
By tracking your inventory and sales, you can identify which products are most popular with customers. This information allows you to adjust your production to meet demand and ensure that you always have enough stock on hand. It also provides valuable insights into customer preferences that can inform your future product development and marketing efforts.
6. Makes Tax Time Easier
Tracking your inventory throughout the year can make tax time much easier. Having an accurate count of your stock and knowing the cost of each item can help ensure that you’re properly valuing your inventory for tax purposes.
Plus, if you’re using an all in one soapmaker software like Craftybase, you’ll be able to generate reports that show your inventory levels and costs - making the whole process much more streamlined.
7. Helps You Stay Organized
Finally, tracking your inventory simply helps you stay organized.
By keeping careful records of what ingredients you have on hand, when they were ordered, and how much they cost, you can create a more efficient workflow and reduce the risk of errors. You’ll be able to quickly locate the supplies you need when it’s time to make soap and spend less time hunting down ingredients.
How can soapmakers track their inventory?
Now that we’ve convinced you of the reasons why you should be starting your inventory tracking today, the next question is likely “but how?” Fortunately, there are several methods and tools available to help soapmakers track their inventory effectively.
Spreadsheets: The most basic method for tracking inventory is using a spreadsheet such as Excel or Google Sheets. This allows you to input your ingredients, quantities, and costs manually and update it as needed.
Inventory Management Software: There are also specialized software options specifically designed for inventory management. These programs can help automate and streamline the tracking process, as well as provide additional features such as cost analysis and forecasting.
Barcode or QR Scanners: In addition to either a spreadsheet or software, some soapmakers use barcode or QR scanners to track their inventory. This involves assigning a unique barcode to each ingredient or product and scanning it when it is used or restocked. While this method may require an initial investment in equipment, it can greatly improve accuracy and efficiency.
Pen and Paper: For those who prefer a more “hands on” manual approach, there are soapmaking inventory tracking templates available for download or purchase. These can be printed out and used to manually record inventory levels.
No matter which method you choose, the important thing is that you start tracking your inventory now to start seeing the benefits.
What to look for in soap maker software
When selecting inventory software, soapmakers should pay attention to several key features.
Firstly, the software should be user-friendly with a simple interface, making it easy to input data and navigate through the system. Secondly, it should be capable of accurately tracking different types of inventory - raw materials, work-in-progress goods, and finished products so that the complete manufacturing flow can be tracked and mapped. The entire soap manufacturing batch process must be managed, including all component traceability.
Additionally, soapmakers should consider software that can generate reports and forecasts to help with decision-making and planning. It is also important to ensure that the software is scalable to accommodate business growth and can integrate with other accounting or sales platforms if needed.
Flexibility in recording units of measurement, given the variety of ingredients used, is another significant feature. The software should also be able to generate informative reports that highlight sales trends, product popularity, and inventory levels, to facilitate business decision-making. Lastly, a valuable inventory software should offer integration capabilities with other systems like accounting or eCommerce platforms to streamline business operations.
Craftybase offers a comprehensive soapmaking software solution tailored to soapmakers’ unique inventory needs. It provides an all-in-one platform that handles everything from manufacturing dashboards to calculating cost of goods sold. The low stock limits and inventory alerts ensure that you never run out of essential ingredients, while the barcode scanning and order tracking features streamline your workflow. Furthermore, the dedicated expense tracking and pricing calculations will make your financial management more efficient. In essence, Craftybase not only simplifies inventory management but also empowers you to take control of the financial aspects of your soapmaking business. Don’t miss the opportunity to make your soapmaking business more profitable and efficient. Start your free trial today and experience the benefits of Craftybase firsthand!
Habits for successful soapmaker inventory tracking
Once you have the inventory solution in place, ensure that you build inventory management into your daily or weekly business routine.
It’s useless to have a shiny piece of software to track your inventory if you aren’t putting the time in to make sure your numbers are accurate. It’s usually a good time to update your records whenever you do any of the following things:
- Buy new raw materials
- Make a sale (some inventory software will do this for you automatically)
- Make a new batch of soap
- Dispose of expired or damaged raw materials
- Dispose of expired or damaged soap products
See our post for more ideas on how you can build good inventory habits into your handmade business.
In Conclusion…
As you can see, there are a number of compelling reasons to track your inventory as a soapmaker. From avoiding overstocking to identifying popular products, inventory management can have a big impact on your business. Fortunately, there are a variety of tools available to help you track your inventory effectively, from using a simple spreadsheet to investing in specialized software. Whichever method you choose, taking the time to monitor your inventory will help you run a more efficient and profitable soapmaking operation.
