A search of Etsy’s current Bath and Beauty category shows more than 1.9 million items, ranging from hair care to skin products, fragrances, and cosmetics. But for body care sellers, there is much more to consider than standing out in a crowded marketplace, choosing a fragrance, or picking pretty packaging.

Following federal regulations, applying proper labels to products, and shopping for business insurance are important considerations for body care sellers.

FDA Regulations and Labeling

Sellers of body care products in the U.S. must make sure they follow both Etsy’s guidelines and the Consumer Product Safety Commission (for soaps) or the Food & Drug Administration regulations (for cosmetics and drugs).

If you need help classifying your item, the FDA website has a helpful article explaining the difference between soaps, cosmetics, and drugs based on their intended use.

• For instance, a product qualifying as a soap must be composed mainly of the “alkali salts of fatty acids,” such as lye. That component must be the only material that results in the product’s cleaning action. Lastly, it must be: “labeled and marketed only for use as soap,” according to the FDA’s frequently asked questions on soap.
• If a product is intended to moisturize skin or make the user smell nice, it would be classified as a cosmetic.
• If the product is intended to treat or prevent disease by killing germs, or treating skin conditions like acne or eczema, it’s a drug.
• An anti-dandruff shampoo meets the definition of both a cosmetic (because it’s intended to clean hair) and a drug (because it is intended to treat dandruff).

In any of the above scenarios, you are still allowed to use the word “soap” on the label, which may be why it’s important to do your research and understand all the aspects of selling body care items before marketing your products.

While it’s legal to make cosmetics at home, the responsibility is on the seller to “make sure your product is safe for consumers when it is used as intended, and to make sure it is properly labeled,” according to the FDA. For cosmetics, neither the product nor its ingredients need approval by FDA, except for any color additives it contains. Sellers don’t need to register their company or file their product formulations with FDA, although they may participate in a Voluntary Cosmetic Registration Program.

The FDA does not required an expiration date to be printed on cosmetic labels in the U.S. Sellers should always follow FDA guidelines for labeling cosmetics, however, since they are ultimately responsible for adverse reactions. Body care sellers should not make claims about a product curing or relieving a health condition or illness. If your product makes therapeutic claims, it may be subject to regulation as a drug.

Correct labeling for body care products is an important point for Etsy sellers, just as it is essential to follow the state and federal regulations. Author of the book Soap and Cosmetic Labeling, Marie Gale has compiled a helpful list of state regulations that apply to handmade soaps and cosmetics, like extra licenses or inspections. For example, California prohibits the sale of cosmetics or ingredients that have been tested on animals. In Nevada, all cosmetic manufacturers must pass an inspection and pay $300 for an annual permit.

Etsy Policies

Etsy’s policy prohibits the sale of drugs or medical drug claims about an item: “A medical drug claim makes a correlation between a product and the cure or relief of a health condition or illness. In many cases, an item itself is not problematic, but the way it is presented with certain language is against this policy.”

Etsy also prohibits human remains or body parts from being sold on the site: “This includes, but is not limited to, things such as skulls, bones, articulated skeletons, bodily fluids, preserved tissues or organs, and other similar products. (Note: Human hair and teeth are currently allowed, so long as the items comply with other Etsy marketplace rules.)”

Business Insurance & Legal Matters

Homeowner’s insurance generally doesn’t cover a cosmetics business operated in the home. For example, let’s say a customer sues you over an allergic reaction to your lotion. You will personally be held liable for damages paid as well as all lawyer fees in the case. If your home flooded and you lost all your equipment, your homeowner’s insurance won’t cover your lost wages, but a good business insurance plan would. Teach Soap shares some great advice on business insurance for your cosmetics business.

Deciding whether or not to purchase business insurance is a main concern for sellers of body care products. “In today’s modern world you can never be too careful,” Schult advises. “When we inquired about business insurance, we realized that many insurance companies don’t want to touch small businesses that focus on bath and body care. Those who are thinking about getting insurance will have to do some research. It took us a while to find something that worked for us. We also have a business lawyer, which I think is important.”

When you don’t even know if your business will succeed, weighing the cost of business insurance or a business lawyer is a personal decision, Schult says. “All state laws vary, so if you choose to start a bath and body business, check into your specific state laws and what is required,” she recommends.

Alicia Schult of LBCC Historical Apothecary strongly advises body product sellers to keep careful records from their ingredients suppliers. “They should all have batch numbers that need to be cataloged for your batches, and you should have personal batch numbers as well,” she says. “Keeping the proper paperwork is so important when making bath and body products.”

Kristina Strain, the owner of Etsy shop BadgerFace Beauty, agrees that sellers should have business insurance. “Running a business is a risk, there’s no doubt about it,” Strain says. “You want to be protected from a liability standpoint. You also want to be covered if you yourself get sick or hurt. Working for yourself, there’s no one to cover for you if you’re down for the count.”

Schult says she started off with historical labels, and there weren’t any ingredients listed on them as they were all listed on the product listing. “The more we learned, the more our labels changed,” she says. “Our goal has always been to keep the original labels, but update them with modern labeling needs. Labeling basics include your business name/logo, your town of operation, the product weight, a list of ingredients (trade secrets have an exception), directions on how to use (in some cases), and a batch number (if you have it).”

Schult does not include an expiration date on products, but her shop recommends products that should best be used within a year. “You always have to stay on top of labeling regulations because they are always changing,” she says. “It’s really important that you stay away from making healing claims about your products. We talk about how they were used historically, but we don’t claim anything. We let customer reviews cover that area.”

Packaging and Shipping

Packaging body care products for shipment has been a learning process for many sellers. For instance, Monica Peralta, owner of both Balm Lady and Sugar Lips Party, has learned to switch up her lip balm formulations during hot summer months so there is less likelihood of a product melting in transit. “I have learned by trial and error, and also by listening to customer feedback,” she says. “Using environmentally friendly packaging options is important to help customers feel better about their purchase and ultimately allows us to have less waste.”

In addition to being “green” with packaging, there’s a pressure for body care sellers to offer attractive packaging. Anything you can do to add a little flair helps, says Strain. “Selling online, the customer doesn’t walk into your shop and get your ‘vibe,’ so you have to do a little extra. The unboxing experience has really become a thing since I started the business.”

For Schult, she errs on the side of less when it comes to packaging. “We don’t go to the excess of having fancy boxes, because it’s a waste of resources, and it is something the customer will throw away first,” she says. “Forgoing extreme product packaging is better for the environment and it helps keep cost low for the customer as well. Bubble wrap, unfortunately, is still necessary for our products because of the glass. We hope to see a recyclable alternative that is cost effective in the future. When at all possible we use USPS Priority mailers and boxes and always insure them because… you never know! Many choose to ship bath and body products in boxes. We use both boxes and padded envelopes.”