Starting an Essential Oil Business: Tips and Advice

Nick Mirev
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    It’s undisputed that most people live a stressful life and often don’t have time to look after their own health. However, this trend is starting to shift as more people aim to train, look after their health, and reduce the stress in their lives. In that environment, essential oil businesses have offered great solutions to people who wish to combine relaxation with wellness. There are numerous types of essential oils that can help ease the muscles and the mind. Although their retail and wholesale prices are still relatively high, essential oils are used in small quantities and don’t harm the household budget. As the demand for these oils is higher than the supply, it can be profitable to open a business in this field. In this article, we’ll share some essential oils business ideas and shed light on the steps necessary to start such a business.

    Key takeaway: Starting an essential oil business can be a profitable endeavor. It doesn’t require large investments and there’s an increase in the demand for these products. Large quantities of essential oils are bought by manufacturers in the cosmetics and wellness industries. Therefore, the majority of retail buyers are not fully aware of the benefits of these products.
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    Essential Oil Business Ideas

    Essential Oil Online Store

    Online trade is slowly but surely replacing the brick-and-mortar business model. That’s why starting an essential oils business focused on selling them online can be very profitable. The capital required is much lower and you can easily expand the project to offer numerous other product categories. You can purchase wholesale essential oils and sell them at retail prices. The expected profit margin is around 30 percent. These ecommerce business ideas often start as dropshipping websites. That way, the shipping and handling of products is outsourced and the business can focus on marketing and growing. If you’re wondering about the steps to start such a company, check out our article on how to start an eCommerce business and how to start a dropshipping business. Our resources on crafting an ecommerce business plan and our ecommerce business guide can also assist you with your journey of starting an essential oil business.

    Essential Oil Manufacturing

    Starting an essential oil business that is focused on manufacturing these products requires a bigger investment compared to simply selling them online. However, being a producer rather than simply selling to retail customers gives you a lot of options. You can sell wholesale essential oils to spa centers and retailers or you can sell them via your company’s website with a higher profit margin. If you plan to become a business owner of an essential oil manufacturing business, the initial investment you’ll need is about $10,000. Roughly half of that is the price of a professional distiller.

    Subscription Box Services

    Online ordering of subscription boxes is very popular, especially for people with busy schedules. That’s why offering subscription boxes with different essential oils or other related products can be a profitable essential oil business. If you plan on starting such an endeavor, check out our article on how to start a subscription box business.

    Keep in mind that there are multiple subscription options on the market. Therefore, you need to stand out from the crowd in order to be successful. One way to do so is by partnering with other brands. For example, you can combine your efforts with brands that sell scented candles, cosmetics, and other goods that pair well with essential oils. This will help your marketing and will make you more competitive as your subscription boxes will have more diverse options.

    Essential Oils Educational Resources and Workshops

    If you’re an essential oils enthusiast, you might enjoy starting an informational website or a YouTube channel related to their production, benefits, and history. This informational content can be used as part of affiliate marketing. Furthermore, the traffic generated by these informational articles, podcasts, or videos can later be used to funnel customers into your own online store. A lot of small direct-to-consumer ecommerce sites have started as blogs first.

    Consider organizing online and offline workshops related to the production of essential oil products, their benefits, and how to mix them.

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    How to Start an Essential Oil Business

    As selling and making essential oils does not require a lot of capital investments, it’s a business that can be started fairly quickly and easily. Here are the main steps.

    1. Create a business plan. It should include financial projections, competition research, marketing strategies, and product research.
    2. Research the market. That includes not only researching the competition, but also finding suppliers and potential customers. Just like other sectors of the economy, the essential oils market is changing and business owners need to stay on track with the trends.
    3. Register your business and obtain all necessary licenses and permits. Depending on the type of business you plan to start, there are different regulations you need to follow. Make sure to thoroughly research the matter and consult with a legal expert.
    4. Fund the business. If you don’t have the necessary funds to start the business, there are multiple ways you can raise them. Loans are the most obvious option. Partnership with friends and family and crowdfunding through platforms such as Kickstarter can be better alternatives.
    5. Start selling through various platforms. You can sell products not only on your own website but also on other third-party platforms like BlueCart or Amazon.
    6. Scale and adapt. As trends change, companies need to adapt to the market demand. Make sure to scale your business following the trends in the sector.
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    Frequently Asked Questions about Essential Oil Businesses

    Although essential oils have been known for thousands of years, they are still considered to be an exotic product in the US. Most people don’t know a lot about essential oils and businesses in this field need to focus more on educating customers about the many benefits of these products. Below you’ll find some of the popular questions about essential oil businesses.

    Are Essential Oils High-Demand Products?

    Yes, the demand for oils has been rising in recent years and is expected to continue its upward trend. The main drivers of the increasing demand are the extensive use in the cosmetics industry and the increased popularity of aromatherapy. A growing number of people are striving to live healthier. That makes it the perfect time to start an essential oil business. 

    Is It Profitable to Sell Essential Oils?

    On average, essential oil businesses have a profit margin between 30 and 50 percent. That makes this niche market a profitable one. Maximizing revenue can be achieved by combining eCommerce marketing with other selling techniques. Consider gradually expanding the products offered by your essential oils business. Here are a few additional categories that can be sold on essential oils eCommerce stores:

    • Scented candles. Aromatherapy and relaxation are often associated with candles. They help achieve a more calm state of mind by combining the comfort of a burning fire and the pleasant odor.
    • Spa and wellness products. Clays, exfoliators, and bath salts are just some of the categories that go well with essential oils.
    • Carrier oils. Essential oils are extremely concentrated. That’s why, in order to be applied on the skin or hair, they need to be mixed with another product called carrier oil. These carrier oils are usually avocado or coconut oils.

    Can You White-Label Essential Oils?

    Yes. You can easily start a white-label essential oil business. It can work both ways. If you have started an eCommerce store but don’t have the equipment to make essential oils, you can find suppliers that can produce oils labeled with your brand. You can also offer white-label products if you make and sell essential oils. Various brands and retailers might be interested in selling these high-demand products under their own brand without having to invest in manufacturing equipment.

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