First off SORRY for the long post I am bored, but I promise it is a good read
Not sure, but it's not just as easy as buying PG/VG, bottling it, and reselling it, especially when using things people put into their bodies. I have been running several businesses for years. And with something like this I would at minimum get a manufacturing license as stated before, in some states these do not come cheap. In order to get one you are going to almost always have to form a business. Then there is the questions of what kind of business to form. You have sole proprietor (probably the worst business to form in a situation like this). You have an LLC probably the most common assuming you know how to do it this can generally be done yourself relatively cheap. Then you have C-Corps, S-Corps, etc., etc. Then you need to decide wish one is the best protection for yourself. You better have separate bank accounts for the business. Write yourself checks unless you are a single member LLC then it is a pass through entity and you can just transfer the profits to yourself. If you are a some type of corporation you are going to need to write yourself payroll checks. Which come with having to have other types of numbers and tax withholding. You need to have a good lawyer generally in case something happens. You need to have state sales tax licenses if required by your state. You probably should have some kind of accounting firm if you get to where you are dealing with big money or have a lot of receivables and expenses. Be prepared for tax audits should you be one of the unlucky few. Never mind the testing that needs to be done with this. MSDS sheets probably need to be on hand and supplied with your goods if you are doing wholesale. You will need to get and keep others sales tax exemptions if you are wholesaling and you better keep good records on everything. You are going to want insurance that covers product liability and also general liability and you policy better be bullet proof in case you get sued.
You will need to have warnings, best uses, what not to do, disclaimers, make sure you are preventing anything from becoming contaminated on your end and through the delivery of the product, credit card processor (preferably one where you can take payments over phone, in person, send invoices and they click to pay, and while on the go). You will need to build a website, if you are taking payments on your website you are going to want to have terms and agreements, terms of service, product disclaimers, etc, etc, along with a good design. I hope you have kick ass SEO skills or have the money to bankroll PPC campains. Social media is a must anymore for online business, don't just think facebook, and twitter, you now have Google+, blogs, Instagram, etc, etc. If you do e-bay or amazon you must take into account their commissions of 7%-15% on average. Shipping needs to be factored in, your time has a price on it. You must account all these things and take them into consideration before you just say "well I can get a 55 gallon drum of each for around $360 before shipping and I don't even have to pay that because I am local and can pick it up." Anyone can buy a 55 gallon drum of each for around $360 I posted a link to it yesterday somewhere in a post about something else don't remember what it was but was breaking down the cost of what someone could save if they bought in small bulk sizes and mixed themselves vs smoking vs buying premade juice.
Now we will just use my states prices for example as a cost to start something like this.
EIN = Free
LLC Reservation of Name = $25
Application for Registration = $55
Certificate of LLC = $105
Business liscense = $15 (this is on the city level where I live)
Merchant Application fee $25
Sales tax bond = $500 (if you have taxable sales that go over the bond this is increased the formula my state uses is (estimated monthly sales x tax rate x 3 = if it is over $500 then you pay that number as a bond))
Business banking account = free to use and keep if you have a combined accounts average daily balance of 25k or more at my bank, if not $35 per month. (for your business only personal funds don't count)
Accounting firm (unless you want to do it yourself) the one I use is $780 per month, quarterly another $1800, and then once a year $1800)
Not sure what testing costs can't be cheap though probably $500-$1000
Product Liability insurance + General Liability = $6800 per year in this type of business if your sales are under $750,000
Lawyer to draft up all you legal mumbo jumbo (disclaimers, uses, etc, etc) mine would charge somewhere in the neighborhood of $3500 but it would be bullet proof)
8x8x8 clean room environment = $15,700 + clean room charis, tables, suits, masks, etc, etc, add another $1500 at least)
Website, hosting, SSL's, terms of use, etc, etc, for something half way decent that isn't what everyone else has if you do not know how to do it yourself another $6500 if you want it mobile responsive (which you will more people purchase from mobile devices than desktops than ever before)
Credit card processor with everything that you will need plus kickass record on defending merchants again chargeback $75 per month plus 2.7% of every transaction
SEO specialist to optimize your website for you another $400-$2000 everytime it needs to be done (this does not need to be done all the time just once in the start and then generally if major changes are made to the search engines algorithms)
Social media guru $1000 per month unless you do it yourself (which really isn't that hard so we won't add this to the total)
So now just to start the business and get it up and ready to go for you to start working it you are at $36,615 for the first month best case, say you build your own site you are 6500 cheaper but you still need hosting this can be had for 200-300 per year for a decent shared host (IE NOT GODADDY). Of coarse this goes down month two to something closer to $1400 as you have paid some stuff in full for a year to save 20% and some things are 1 time costs. Now this does not include buying your products, or marketing yourself, or paying for advertising on forums or anything like that. But I am not going to get into all of that, and honestly you should be paying for this information lol but I am bored and tired and can't go to sleep for another 2 hours so I need something to do to pass my time at the moment.
Now that you are ready to go you can purchase your goods. Bottles = $.40 each (for 1 gallon bottles) if bought in bulk to get good price $2000, label printer (a good one not some cheap inkjet or laser jet) $3500, labels for your bottles $.18 each for blank weatherproof labels $800 (you have 5000 bottle need 5000 labels). 55 gallons of PG and VG $720 total cause you picked it up yourself, if you had it shipped add another $200ish to have a pallet sent to you hope you live on a road a box truck can get down or get a commercial building (that would add more cost to bottom dollar). You are now at a month 1 cost $43,187
So now you have 110 gallons of VG/PG you can buy this online for $20-$30 per gallon so you are going to have to AT MINIMUM probably match it. This will put you at a $2,200-$3,300 in sales then you take out your 2.7% to the CC processor and you are left with $2,140-$3210. Subtract the cost of your raw materials and you have $1360-$2427 then subtract your monthly cost of running business and you are either in the whole $40 to having $1027 left over or anywhere in the middle depending on you selling price, now this is assuming you have sold 110 gallons. Now let say you do awesome and you sell 220 gallons you are now at a positive $1320-$3454 and you put all that back into your investment minus you yearly fees and quarterly fees (an average of 1375 per monthbased off the number above) that goes in a separate bank account so you can pay them next year when they come around and you are left with yet again either negative $55 to a positive $2080 or anywhere in between.
I am by no means trying to discourage you as entrepreneurs is what builds this country, Small business is what employees most people. However as a business owner, and thinking about this in a logical way that would protect me, my property, and doing it correctly these are the things I know in my state you would have to do AT MINIMUM this was done off the top of my head and with some personal experience plus 3 hours of research real quick online about what you would need and not need at minimum. This was just a rough estimate and in know way would I think it could be done that cheap. You need a solid business plan, research for at least 2-3 months on all the costs associated and how your going to execute, then break it down and see where you have to sell your products at and how much of them you have to sell to break even at the end of the month. Then you need to figure out a way and execute how to sell even more than what you need to break even so that you can pay yourself or at least get your investment back... Say you used the very good rough numbers I came up with above and you sold 220 gallons per month at $25 you would have roughly $2516.50 left after setting everything back and paying for everything and it would take you 17 months just to get your investment back and you haven't even payed yourself yet.......
