What counts as COGS for a candle brand

Wax, fragrance oil, vessels, wicks, protective packaging and breakage allowance: which candle costs belong in COGS when measuring POAS on Google Ads.

Costs of goods sold, buying and occupancy as a share of net sales, Bath & Body Works, fiscal 2025 (10-K)

56.3%

Source: Bath & Body Works, Inc. Form 10-K, fiscal year ended 31 January 2026 (filed 12 Mar 2026), accessed 30 Sept 2026. Full citation

Bath & Body Works reports a gross profit rate of 43.7% for fiscal 2025, so costs of goods sold, buying and occupancy were 56.3% of net sales. That cost line includes the shipping of online orders, as POAS should, and also store buying and occupancy costs, which a Shopify brand doesn't have. The company sells body care as well as home fragrance, so this isn't a candle-only figure. One listed company, not an industry average.

For measuring POAS, "cost of goods" means every cost that scales with each order you sell. Ad spend is not included, because it's the other side of the ratio. For a candle brand, the wax and fragrance are only part of it. The glass, the packaging that keeps it whole and the cost of shipping something heavy can add up to more.

What goes in

Cost	Count it?	Why
Wax	Yes	Per candle
Fragrance oil	Yes	Per candle, and can be the priciest raw material
Vessel: glass jar, tin or ceramic	Yes	Per candle
Wick, lid and label	Yes	Per candle and easy to forget
Pouring and finishing labour	Yes	Per batch, spread per candle
Protective packaging	Yes	Glass needs more of it
Pick, pack and outbound shipping you pay	Yes	Priced on weight and size
Payment processing fees	Yes	A share of every order
Replacements for candles broken in transit	Yes, spread across orders	Paid after the sale was recorded
Scent development and testing	No	Paid once per scent
Photography and trade shows	No	Overhead and marketing
Google Ads spend	No	It's what POAS divides by

Breakage deserves its own line. We haven't found published data on how often shipped candles break, so work out your own rate: replacements sent in a month, divided by orders shipped. Then spread the cost of those replacements across every order.

Building one order's cost

Illustrative arithmetic with made-up round numbers, not a benchmark.

An 8 oz candle in a glass jar that sells for $32:

Wax $1.20, fragrance oil $1.80, glass jar $1.50, wick $0.10, lid and label $0.60, pouring labour $1.00: $6.20.
Protective packaging $1.50, shipping $8, payment fees at 3% $0.96, breakage allowance $0.50.

Cost per order: $17.16, or about 54% of the price. The candle itself was about 19%.

Two candles in one order for $64: $12.40 of candles, $2 of packaging, $10 of shipping, $1.92 of fees and $1 of breakage allowance. Cost per order is $27.32, about 43% of the price.

Shipping is the biggest single cost in that example, and it barely grows when a second candle joins the box. That is why basket size moves candle margins so much.

Three levels of accuracy

Selvra OS works with three tiers of cost data and shows which one a figure is based on.

T1: one flat margin (labelled "estimated")

One percentage for the whole range. This is workable for a brand selling one size of candle. It misleads once tins, large jars, diffusers and gift sets sit together.

T2: margin by category (labelled "approximate")

A margin per product type: small candles, large candles, diffusers and refills, gift sets. Size matters as much as scent, because the vessel and shipping costs change with it.

T3: cost per product (labelled "verified" once synced)

Shopify's Cost per item field, per variant, read directly. Scents in the same jar may share a cost, but check: some fragrance oils cost much more than others.

Reading the benchmark above

The figure above is one listed company: Bath & Body Works reported a gross profit rate of 43.7% for fiscal 2025, so its costs of goods sold, buying and occupancy were 56.3% of net sales. That cost line includes the shipping of its online orders, as POAS should, but also the costs of running its stores, which a Shopify brand doesn't have. It sells body care as well as home fragrance. Treat the figure as a reference point, not a target.

Common COGS mistakes in candles

Costing the wax and fragrance only. The jar and packaging are per-unit costs too.
Leaving out breakage. Replacements are part of what every order costs.
Using one margin for single candles and bundles. Shipping makes them very different.

The same question in other verticals

Shopify Profit Margin CalculatorSee your true profit margin per order once COGS, shipping, and fees are factored in.
Shopify COGS Setup: How to Track Cost of Goods SoldWhere Shopify actually stores cost of goods sold, why it doesn't reach Google Ads on its own, and three realistic tiers of accuracy for tracking it.

Source and how to read this number

Figure: Costs of goods sold, buying and occupancy as a share of net sales, Bath & Body Works, fiscal 2025 (10-K): 56.3%
Source: Bath & Body Works, Inc. Form 10-K, fiscal year ended 31 January 2026 (filed 12 Mar 2026)
Link: https://www.sec.gov/Archives/edgar/data/0000701985/000070198526000008/bbwi-20260131.htm
Accessed: 30 Sept 2026
Caveat: Bath & Body Works reports a gross profit rate of 43.7% for fiscal 2025, so costs of goods sold, buying and occupancy were 56.3% of net sales. That cost line includes the shipping of online orders, as POAS should, and also store buying and occupancy costs, which a Shopify brand doesn't have. The company sells body care as well as home fragrance, so this isn't a candle-only figure. One listed company, not an industry average.
Last reviewed: 30 Sept 2026