This transcript was generated from the episode audio and may contain minor errors.
Hey, what's up? Welcome back. Once again, this is Side Hustle School. I am Chris Guillebeau. I have the honor and privilege of bringing you a new story every day. I hope you enjoyed
the Chronicle of the Worm Empire, something very different for you today. What do you do if your day job is seasonal and you have several months off or at least a time of year in which your work is much less busy? Well, naturally, you start a side hustle. Maybe that's yet another reason why we have so many teacher stories on the show, because teachers are busy, hardworking, yet they often have some extra time in the summers. Well, today's story is not about a teacher. It's about a guy with a seasonal business that he operates
much of the year, but also has a lot of downtime. Now, in that downtime, he learned to do something very creative that you will not be surprised to hear also makes money. In Charleston, South Carolina, Mark Gaskins owns and operates a commercial kitchen equipment business. This business provides propane kitchen equipment on wheels for weddings. The business is seasonally based on the wedding season, which in Charleston slows toward trickle in the cold winter months of January and February, and the very hot summer months of July and August. This day job was actually a side gig originally that came about while he was working
at his brother's bar and the bar burned to the ground. After that, the kitchen equipment business became Mark's full-time job. This is, of course, another important reason to start a side hustle. You never know when you might have to rely on it. The business is called Event Kitchens, and during the downtime, Mark began his new hustle of buying wholesale candles from a local company and selling them on Amazon using a Prime seller account. Now,
here's how it worked. He'd order from the company, they would ship the candles to Amazon, customers would order, and then Amazon would ship the candles to the customer. So as part of this process, Mark never actually touched those candles. Now, that was a good starter project, but soon, Mark realized even though it would be more work, he'd probably make a lot more money if he manufactured and sold his own brand of candles instead of just reselling. His aha moment came when he was traveling in Austin, Texas. He walked into an upscale
men's store and he saw a nine ounce candle selling for $85. Do people really buy candles for $85? Apparently some do. So on the flight home, he began to develop his own brand called Meeting and Market Candles. The name references the intersection of the historic market in Charleston. So how do you learn to make candles if you've never done anything like that before?
Well, just like the ancient Egyptians did, you log on to YouTube. Mark found and watched countless video tutorials on YouTube from a company called Candle Science, which is the largest purveyor of DIY candle supplies in the country. After watching the tutorials, he went to Michael's craft store, bought some supplies, and started messing around. He used mason jars from his kitchen and any other jars he could get his hands on and he ended up giving away about 200 candles to friends and family as part of the trial and error process. Mark learned that temperature plays a huge role in the setting of a candle, so he tested pouring the hot wax at different degrees, 185, 175, 165, and so forth. He finally
settled on that last number, 165 degrees Fahrenheit, for the ideal finish. Those initial candles were white wax and clear glass with a white label. Not bad, but the design of it felt very 1980s. He wanted something more progressive, so he started searching far and wide for glassware until he found an amber cube he really liked. As he developed a new and improved version with a redesigned label created by a local graphic designer, sales have begun to take off. Popular scents include lavender chamomile, red ginger saffron, and blackberry sage. Mark's
candles cost about $7.50 to make. He sells them for $16 wholesale and $32 retail. We're going to come back to that in a moment because I want to make sure you know why he chose those different prices for different kinds of sales. In addition to the manufacturing costs, his expenses include supplies, advertising, and the chunk of sales Amazon takes, so his net profit on Amazon, even though the margin is much larger, is about 50%. In addition to selling on Amazon, he also sells at farmer's markets, in some retail stores, as well as Amazon Etsy and through his own website. Once he made those adjustments, he quickly
began earning about $1,000 in net profit each month. He expects that number to increase as he gets picked up by other markets, and his goal for the end of this year is to make $5,000 a month in Amazon sales alone. Longer term goals include increasing wholesale buyers through trade shows and maybe eventually making Meeting & Market, a national home goods brand that includes bedsheets, bath towels, kitchen towels, and so on. But first, he's going to master the candle market. So great success story here. Love what Mark has done. It is completely possible to have
a virtual hustle in which you actually don't have any inventory. You're strictly reselling, as we've seen in many other stories. But clearly, in this example, Mark was wise to kind of take on the whole process himself and make his own brand. And it took a little while to crack the code and figure out, okay, what is the right temperature? What is the right design, etc. But once you get to $1,000 a month with a project like this, which is where
he was at when we spoke, it is often very feasible to quickly ramp that up with just some improved distribution or some better marketing. So I'm glad he's working on that. I wanted to talk briefly about pricing an item that you manufacture, like what Mark has done with the candles, and then reselling those items at different prices in different channels. Now, just to recap, Mark had three different prices, technically four with a farmer's market discount. But the three basic prices were $7.50 for manufacturing costs, let's just say $8 for simplicity, $16 for his wholesale price, and $32 for his retail price. So this pricing doesn't come out of thin air. If you take $8, the manufacturing
cost, you double that number, you get $16. If you double that number, you get $32. So 8, 16, and 32. So if we start from the top, Mark has set his retail price at $32. This is the price you can expect to pay on Amazon or in a store. Now, because he's working with
other distributors, he has wholesale pricing, in which companies can buy his candles in bulk, and then resell on their own. Now, the wholesale price is half of the retail price, which is common. So they pay $16. Mark is still making about $8 per candle. But then the distributor or the wholesaler, the retailer, whoever it is, is also able to make profit, because they then double the price to $32. So we've got 8, 16, and 32. These prices can
work well for everyone involved in the process. Mark could choose to only do retail business and be the only seller for his candles. But he's determined that he's actually going to be more successful by offering the wholesale model. Or he could do wholesale only. And the only way to buy his candles is through a distributor or a retailer. But at least
for now, he's kind of doing both, which is completely possible, especially if you have a pricing structure like this. One way it wouldn't work super well is if Mark sold his candles at the wholesale rate of $16, but then also sold them at retail for $16 or just a bit more. That wouldn't work well for whoever else was selling the candles, because there's no room for them to make a profit. So there's a tradition in a wholesale-retail relationship, and obviously this varies by industry, but a general rule of thumb is that the retail price is going to be twice whatever the wholesale price is. And this has been disrupted in some ways, in certain industries, there are different rules, but this is the traditional price structure.
Now, I mentioned that Mark also sells at farmer's markets, and there is a fourth price. At the farmer's market, he actually discounts to $25 a candle. And that seems like a reasonable $32 to $25, so you can save $7 if you buy it at the farmer's market. It's only offered at that market. You can't buy it online, so he's not really competing with his own distributors.
And by pricing smart like this, he's able to reach different kinds of buyers in different parts of the country who might never hear of him otherwise. So congratulations, Mark. Great job learning to make candles by watching YouTube. I'm going to go to his website and place an order myself. If you want to check out Meeting and Market, learn about the candlemaking industry, just come over to side of schools.com/8080. As always, inspiration is good, but inspiration
combined with action is so much better. I want you to take the ideas you hear about here on the show and do something with them for yourself. I'm Chris Guillebeau. This is Side Hustle School, and I'll see you tomorrow.
