Journal · Unit math
Wax, wick, and jar feel like the whole cost because they are the part you can hold. They are the start of the unit, not the unit.
Take a $12 candle. The wax, fragrance, tin, wick, and label might come to $3.80. That number is comforting. It is also missing the pour, the cleanup, the lid that did not seat, studio rent for the month, the Etsy fee, the mailer, and the Saturday booth you still have to cover when rain keeps people home. Makers print that $3.80 on a sticky note and call it cost of goods. Then they wonder why a busy month still feels thin.
Cost of goods, in a studio, is not a supplier invoice. It is everything that had to be true for one finished unit to leave the bench. If a line of work used the studio, the hour, the carton, or the failed twin, it belongs on the unit. Skipping a line does not make it free. It just hides it until rent is due.
If you can hold it, you remembered it. If you cannot hold it, you still spent it.
The habit is understandable. Wax arrives with a packing slip. Fragrance has a price per ounce. Jars come in a case of twelve. Your Tuesday does not. Neither does the zipper that failed on bag four, or the 6.5 percent Etsy took after you thought you were done. The unit used all of that. A costing sheet that stops at materials is a materials sheet. It is not a unit.
What $3.80 skipped
Walk the same $12 candle and write the layers the receipt never listed. None of these are personality. They are minutes, square feet, and breakage.
Setup, melt, fragrance, pour, wait, trim, label. Forty minutes at $22 an hour is $14.67 before a stone goes on.
One in twelve tins tunnels or weeps. The eleven that sell carry the twelfth, or your sticker is a wish.
Studio month divided by units you actually finish. Not units you hoped to finish in January.
Box, wrap, tape, label, ten minutes at the table. If the buyer paid $5 and you spent $6.10, the unit is already short.
Etsy, Faire, cards, platform ads you treated as optional. They come off the price. Put them on the unit.
Booth, parking, bags, unsold loaves. A slow table still happened. The bars that sold pay for the day.
The hour you shot six angles and wrote the listing is not marketing magic. It is minutes on the SKU.
A $8 second used the same wax and most of the hour. Firsts have to know that, or they subsidize it in secret.
Write the $12 candle as a ledger
Here is a version you can argue with. Argue with the numbers. Do not argue with the idea that they belong on one page. This is one eight-ounce tin, sold direct, packed in a mailer, with a real waste rate from the last three batches.
| Line | On one tin |
|---|---|
| Wax, fragrance, dye | $1.90 |
| Tin, lid, wick, warning label | $1.55 |
| Outer label and string | $0.35 |
| Materials you can hold | $3.80 |
| Labor, 40 minutes at $22/hr | $14.67 |
| Waste, 1 in 12 on materials and labor | $1.54 |
| Studio month, 180 finished tins | $2.40 |
| Mailer, wrap, tape, label | $1.85 |
| Packing minutes, 8 at $22/hr | $2.93 |
| Platform and card, 9.2% of $12 | $1.10 |
| True unit before you keep a dollar | $28.29 |
Read that last line out loud. The candle is not a $3.80 object you sell for $12. It is a $28 object you have been selling for $12. That is not a branding problem. It is a sheet that stopped too early. You can raise the price, drop a channel, shorten the process, or stop making this tin. You cannot keep the $3.80 story and also keep the studio.
People flinch at labor. They say they would have been home anyway. They would not have paid themselves $22. Fine. Write $16. Write $12. Write the number you would actually pay a neighbor to pour, trim, and pack while you were sick. Zero is the only dishonest number, because zero is the rate at which you will also accept a stranger using forty minutes of your Tuesday for nothing.
Waste is the other flinch. Makers wait for a perfect month and cost that month. Cost the last twelve batches, including the ugly ones. If your rate is better than 1 in 12, the line gets smaller. If it is worse, the line gets bigger. Either way it is a line, not a mood.
Overhead is not a vibe
Rent, insurance, the mixer, the extra fridge, Shopify, the photographer you hired in April. Add a month of those. Divide by units you finished and sold or still honestly expect to sell, not by a production fantasy. If February made 90 tins and July made 220, do not use July to cost February. Use a trailing number you believe. Recost when the studio changes, not when you feel busy.
Fees sit after you think you are done. That is why they vanish. Etsy, Faire, cards, packing tape on the wholesale carton. They come off the price. If they are not in the unit, you are paying them out of the part you called profit. Profit is what is left after the unit is whole. It is not the gap between $12 and $3.80.
Market days belong here too if this SKU actually goes to market. An $85 table on 40 bars is $2.12 a bar before gas. If the candle only sells online, leave the booth off this SKU and put it on the ones that ride in the bin. Cost the path the unit really takes. Do not average every possible path into a mush that matches none of them.
What to do with the number
Once the unit is a number you can read out loud, you have choices that are not vibes. Raise the sticker until the unit plus a margin you named can live there. Cut a process that was eating forty minutes you never billed. Stop a channel whose fees make the math impossible. Make fewer SKUs so overhead has fewer places to hide. None of that is available while the sheet still says $3.80.
The Costing Workbook does not invent a market for you. It makes you look at every layer on one SKU, in order, until the per-unit cost is a number you can stand next to. The sheet is $39. Fill it for the candle you think you know. Then fill it again for the SKU you have been afraid to look at.
Next in the journal is time, because labor is the line most makers still treat as a personality trait. It is minutes. Minutes have a rate.
