The Indian candle making industry was valued at Rs 715 crores in 2020. Its market size is expected to grow to Rs 1,338 crore by 2028. So, if you’ve been making candles at home and have business acumen, this is the perfect time to start a candle making business.
Today, the candle business in India has transcended its traditional role of providing mere backups during power outages. Indians are increasingly using scented candles to make their homes smell nice and light up their dinner tables. They also gift candles to their friends and families on special occasions.
Join us as we walk you through the step-by-step process to start a candle making business from the ground up.
Step 1. Master the Art of Candle Making
Crafting the perfect scented candle demands precision, particularly when selecting and using raw materials. Your candle shouldn’t be too smoky or overwhelm the customers with its smell. Instead, it shouldn’t be any less than a sophisticated décor item and must have an aroma that soothes the senses.
So, before going any further, learn the craft of candle making. Do your research, watch tutorials, or join a workshop. Alternatively, you can get an expert to help manufacture candles while you take care of the other operations.
Step 2. Develop a Plan for Your Candle Making Business
Once you’ve perfected your craft, you’ll need to write a business plan, i.e., your roadmap for selling your candles in the market. A business plan is also required when raising capital from investors or applying for a business loan from a lender. Here are some things you must include in your plan:
1. Business Name: Pick a name that is catchy, easy to remember, and aligns with your business. Also, make sure the name is unique and no other entity has claimed it already.
2. Business Structure: When registering your candle making business, you’ll need to define the structure of your business. Sole proprietorship, general partnership, corporation, or limited liability company (LLC) are some common business structures in the country.
3. Product and Services: Define the products and services your business will sell. Include the types of candles you plan to sell, their prices, source of supplies/raw materials, cost of supplies, total production cost, etc.
Step 3. Get License and Permits
To start a candle making business in India, you’ll first need to register your business with a relevant authority and obtain the necessary licenses. You’ll also need a valid GST number for taxation. The required permits will vary depending on your state, type of business, and structure. So, make sure to research the regulations and jurisdiction in your state.
Step 4. Find Your Market
There’s a creative aspect to making candles at home, but business needs strategy for success. A candle business in India has many options to reach its customers. The key is to identify the best market where your ideal customers exist.
Will you sell to a local outlet, boutique, etc., or sell directly to customers? Will you take orders in bulk or offer customized products? Are you targeting the premium segment or offering affordable scented candles?
You may also plan to sell online. Then, you must consider whether you will rely on an existing e-commerce platform like Amazon or build your website. You can also explore social media platforms like Instagram, which offer online shopping capabilities.
Step 5. Get Funds
Next comes the most crucial part of establishing a candle making business: raising funds for capital and operating expenditures, such as investing in tools, purchasing raw materials, paying any employees you hire, etc. Here are some of the best sources to acquire funds for your brand-new venture:
1. Small Business Loans: Financial institutions offer small business loans tailored to the unique needs of a business in its infancy. These loans can provide substantial funds at favourable interest rates and repayment terms to help cover the cost of initial operations.
2. Business Credit Cards: You should get a business credit card to settle your everyday expenses, such as purchasing raw materials, paying for utilities, or covering travel costs. These cards often come with benefits like rewards and 0% introductory APR offers, making them ideal for smaller, ongoing business expenses.
3. Startup Funding: In this method, you can raise funds in exchange for equity from investors, who could be venture capitalists, established brands, etc. Alternatively, you can also leverage online crowdsourcing platforms to raise money directly from people.
Step 6. Purchase Supplies and Raw Materials
After you’ve acquired funding, use it to purchase the equipment and raw materials needed to produce scented candles. Even if you make candles on a small scale, you’ll need to invest in tools like moulds, boiler pots, spatulas, thermometers, etc.
Then, you’ll need raw materials like wax, wicks, colours, essential oils, fragrances, shipping and packaging supplies, and so on. To save money, always buy in bulk from a wholesale supplier.
Step 7. Market Your Product
Finally, consider your product’s key features and selling points. For instance, do your candles have a more potent fragrance or last longer than the competitors? Are they made from sustainable raw materials? Use these points to market your candles to your potential customers.
When it comes to finding customers, word of mouth and social media work great for newer and smaller businesses. Also, once you’ve acquired a handful of customers, keep them engaged with email marketing. As your candle making business grows, you can explore paid marketing campaigns such as social media and search ads to reach a wider target audience.
Final Words
Running a successful candle making business requires mastering both creative and operational aspects. As one of the top business ideas with low investment, use your creativity to produce candles and craft a marketing plan. Use your business acumen to define your brand’s positioning and strategy, and success will follow.
If you need funds for your candle making business, turn to Tata Capital. We offer MSME & SME loans of up to Rs. 90 lakhs to help you meet your immediate and long-term business needs. These loans come with affordable interest rates and flexible repayment tenure, so you can grow your business without hassle.
To know more, visit the Tata Capital website or download the Tata Capital App.
28 May 2024
6 mins read
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