How to Start a Green Cleaning Products Business

Starting a green cleaning products business can be an exciting and rewarding business venture for entrepreneurs who are passionate about sustainability and want to make a positive impact on the environment.

Having said that, you should keep in mind that launching a successful green cleaning products business requires careful planning, significant investment, and a wide range of skills.

In this comprehensive guide, we’ll walk you through all the essential steps you’ll need to take to start your own green cleaning products business, from conducting market research and obtaining licenses, to establishing supply and distribution channels, plus attracting customers.

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Industry Overview

In 2023 alone, the global household cleaning products industry was valued at around $38.39 billion USD. Additionally, the market’s value has been steadily growing at a compound annual growth rate (CAGR) of around 2.58% since 2013 and is expected to reach a value of $46.5 billion USD by 2029.

While this sector is made up of a number of different types of cleaning products, laundry care products appear to be the leader of all segments in terms of value.

On top of this, there’s a growing overall trend among consumers to value sustainability when it comes to choosing which products to buy, with more than 30% of US consumers indicating that they would be prepared to pay extra for home and laundry products that are eco-friendly.

This growing market represents the perfect opportunity to offer cleaning products that meet both environmental standards and consumer demand. 

Startup Costs

If you’re considering whether a green cleaning products business is right for you, the first thing you’ll need to know is whether it’s a) affordable, and b) worth the investment. I mean, how much can you actually make running your own green cleaning products business?

Well, it depends. The initial investment for a green cleaning products business varies widely based on factors such as your business’s size and the type of cleaning products it offers:

• Raw materials and product design will likely be your largest expense — obtaining the eco-friendly ingredients needed to formulate your cleaning products is very costly, and you’ll need a steady supply of items like essential oils, vinegar, baking soda, and other non-toxic chemicals. Depending on the products you’re creating and the quantity you need to produce, you could easily spend between $2,000 and $10,000 on these materials alone, though you may need to spend much more than this for a larger-scale production.
• Manufacturing your products is another huge expense to be aware of when budgeting your overall startup costs. Unless you have significant capital to invest in the necessary equipment needed to mix and produce your own products, you’ll likely need to outsource production to a third-party manufacturer — the cost of which can vary, but typically ranges between $5,000 and $10,000 since you’ll need to buy your products in bulk to be able to make a profit.
• Packaging and labeling will also represent a significant cost, particularly since you’ll want to opt for sustainable packaging (i.e., biodegradable or recyclable materials). For a small startup, you might initially spend between $1,000 to $5,000, depending on the type of packaging and the quantity ordered, while larger businesses can spend much more. Remember that your labels will further add to this cost, and must contain the key information on your cleaning products, such as their ingredients and certifications of their eco-friendliness.

In addition to these initial expenses, the main ongoing costs you should be aware of will include replenishing the necessary raw materials, obtaining packaging supplies, and the cost of shipping orders to customers as you continue production.

On top of this, you’ll also need to budget for marketing efforts, rent for a warehouse to store your product, and regular business insurance premiums to keep your operations running smoothly.

Earning Potential

The earning potential for a green cleaning products business is promising, especially given the growing preference of consumers toward environmentally sustainable products.

Revenue will either be generated through the sale of individual products directly to consumers, or bulk sales made to places like supermarkets, wholesalers, or multi-level marketing companies.

Ultimately, the pricing will be dictated by production costs, packaging, and market demand, though it’s worth noting that green cleaning products typically allow for higher price points since customers are willing to pay more for them.

Profit margins can grow significantly over time, though will typically range somewhere between 20% and 40% — the key to making profit with this business model is to take advantage of bulk buying discounts to maintain competitive pricing while offering your customers high-quality and eco-friendly products.

While some businesses may start seeing profits within the first year, it typically takes around three years to build a strong reputation and generate six-figure profits. To increase profitability, you should focus on expanding your reach through large online platforms like Amazon and by actively engaging in the eco-friendly community through workshops, conventions, and sponsorships.

7 Steps to Starting a Green Cleaning Products Business

In order to start a green cleaning products business, you’ll need to complete the following steps:

1. Planning Your Green Cleaning Products Business
2. Registering Your Business
3. Developing Your Product Line
4. Finding a Secure Storage Space
5. Setting Up Sales Channels
6. Getting all Applicable Licenses and Permits
7. Obtaining Business Insurance

We’ve broken each one of these down in more detail below.

Still exploring your options? Check out other small business ideas.

Step 1: Plan Your Green Cleaning Products Business

Before diving into your green cleaning products business, you’ll need to spend some time conducting thorough market research.

This can involve analyzing the local market to understand the demand for eco-friendly cleaning products, identifying potential competitors, and assessing the target demographic.

This will help you evaluate the financial viability of your project — including projected revenues and expenses — as well as determine the best location for your business.

Finding a Suitable Name

Choosing the right business name is both important and challenging.

Your name will need to be eye-catching, memorable, and (at least somewhat) related to your industry.

If you don’t already have a name in mind and need help, you can visit our How to Name a Business guide or use our Green Cleaning Products Business Name Generator tool.

In order to draw attention to the green aspect of your business, try to include a word or term in your name such as “sustainable”, “green”, or “eco” as this helps to make your business’s mission statement immediately clear to potential customers.

If you do have a name in mind, we recommend researching the following to confirm it’s available:

• Your state’s business records
• Federal and state trademark records
• Social media platforms

You will also need to make sure that your business’s name is available as a domain — this is your website’s URL address.

Note: If you’re planning to operate a sole proprietorship, you might want to operate under a business name other than your own name — known as a “Doing Business As” (DBA) name. Keep in mind that this is not recommended for a green cleaning products business.

Create a Business Plan

At this point, it’s helpful to come up with a more detailed plan of how to proceed forward with your green cleaning products business by asking yourself a series of questions:

• What is the mission or vision of your business?
• Who are your ideal customers?
• What products do you plan to offer?
• What is the Unique Selling Point (USP) of your products?
• How should you price your products to cover production costs while remaining competitive?
• What marketing strategies would be most effective for your business?
• What are your financial projections for the business? (e.g., startup costs, forecast revenue and plans to scale)

Creating this detailed plan is a critical step in starting your business — not only because it serves as a roadmap on your goals and how you plan to achieve them, but because it will come in handy when seeking investors or loans too.

Establish Your Brand

Due to the more premium price point of green cleaning products (due to the higher cost of eco-friendly ingredients and packaging), it’s important to invest in strong branding that highlights the environmental benefits and long-term value of your products in order to justify their cost to consumers.

When seeking to establish business’s brand, we recommend focusing on the following key points:

• Eco-Friendly Branding: Be sure to highlight the environmental benefits of your products in its branding and marketing by taking advantage of eco-friendly logos, certification seals, language like “natural”, “organic”, or “plant-based”, and green color schemes.
• Sustainability Story: Another effective tactic is to share your brand’s sustainability journey with customers. When doing this, make sure to explain how your products help to reduce environmental impact — whether it’s through lower toxicity, sustainable packaging, or greener ingredients — and why this is personally important to your brand.
• Transparency: It’s important to show consumers that you are worthy of their trust by maintaining complete transparency where possible when it comes to your green products. Be sure to clearly communicate the origin of your ingredients as well as the eco-friendly steps taken in the production process.

With these essential preliminary steps out of the way, you’ll be ready to move ahead with legally registering your business as an official entity.

Step 2: Register Your Business

One crucial aspect that cannot be overlooked when starting your green cleaning products business is the importance of establishing a solid business foundation.

While sole proprietorships and partnerships are the most common entity types for small businesses, they’re a far less stable and advantageous option than LLCs — especially when it comes to green cleaning products businesses (with potential liabilities and debt).

This is because unincorporated business structures (i.e., sole proprietorships and partnerships) expose you as an owner to personal liability for your business’s debts and legal actions, while LLCs protect you by keeping your personal assets separate from your business’s liabilities.

In practice, this means that if your green cleaning products business were to face a lawsuit or incur any debts, your savings, home, and other personal assets could not be used to cover these costs. On top of this, forming your business as an LLC also helps it to appear more legitimate and trustworthy.

Note: If you’re interested in more information before getting started, we recommend having a look at our state-specific How to Start an LLC guide (DIY) or our in-depth Best LLC Services review (for those opting for a professional service).

Step 3: Develop Your Product Line

Developing your product line is a crucial step in building your business and is typically broken down into three general parts:

• Deciding which type of cleaning products to sell
• Creating the cleaning formulas and product testing them
• Checking that your products can be certified as “green”
• Designing effective and sustainable packaging

To start off, it’s a good idea to identify which cleaning products align with both market demand and your business’s eco-friendly values. Popular options include all-purpose cleaners, glass and window cleaners, disinfectants, and specialty products for specific surfaces like wood or stainless steel.

Once you’ve determined the types of products you want to offer, focus on creating formulas that are both effective and safe — meaning they’re non-toxic, biodegradable, and ideally plant-based in order to appeal to environmentally conscious consumers. You’ll likely need to work with a chemist or a chemical manufacturer for this step.

After product testing to confirm your cleaners perform well, you’ll need to ensure it abides by the specific guidelines set by organizations that certify green products (e.g., Green Seal or EPA Safer Choice), to guarantee that your products are safe for both the environment and human health.

Finally, you need to design an eye-catching yet eco-friendly packaging option that hopefully helps your green product stand out from competitors’. For this, consider using recyclable, biodegradable, or refillable containers that will reduce environmental impact and further appeal to environmentally-conscious consumers.

Step 4: Find a Secure Storage Space

After developing your product line and establishing relationships with the necessary suppliers to make your idea a reality, it’s time to find somewhere that you can store all your products.

The main reason for this is that — in order to obtain the price breaks that will make it feasible to sell — you’ll need to have a large supply of these products. This is because unlike a “print on-demand” business model, where items like t-shirts are produced only once an order comes in, cleaning products require bulk buying in order to significantly lower production costs.

With that being said, proper storage isn’t just about having a large enough space — you’ll also need to make sure it’s dry and climate-controlled to protect sensitive ingredients from extreme temperatures or moisture, thereby maintaining your products’ integrity.

We recommend renting a commercial storage unit or warehouse — in particular, look for a facility that offers flexible lease terms and easy access to transportation routes for shipping and distribution.

On top of this, ensuring it meets any local safety and regulatory requirements for storing chemical products (even if non-toxic) before you sign a commercial lease will save you a lot of hassle in the long run.

Step 5: Set Up Sales Channels

With your storage sorted, the next step is to figure out how you’re going to actually sell this product — whether this is directly to supermarkets, wholesalers, or a multi-level marketing company that then sells it on to consumers.

If you’re looking for low overheads, a good way to get started is through online sales by creating an e-commerce website (e.g., through Shopify or WordPress) — this allows you to easily sell directly to consumers and can be complemented with social media marketing to attract eco-conscious shoppers.

Additionally, it’s also a good idea to take advantage of major marketplaces like Amazon or Etsy by listing your products on them so that you can tap into larger audiences who are specifically searching for green products.

If you’re interested in a more traditional retail approach, you can partner with local and national retailers that specialize in organic or eco-friendly products. This is a particularly effective tactic as getting your products on the shelves of physical stores gives customers a chance to see your brand in person, which builds trust.

Finally, one of the most effective ways to significantly boost your revenue is by supplying bulk sales of your green cleaning products to wholesalers (e.g., cleaning service companies, hotels, or other businesses). If possible, we recommend this strategy as it’s great for establishing a steady stream of income as businesses tend to order products in larger quantities on a regular basis.

Step 6: Secure All Necessary Permits and Licenses

To be able to operate your business legally, there are a number of different licenses and permits you may be required to obtain.

We’ve broken these down in more detail below.

EPA Registration

If any of the cleaning products you plan to offer make any claims about disinfecting or killing germs, you may need to register them with the Environmental Protection Agency (EPA) under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA).

Similarly, any green cleaning products that use certain chemicals or pesticides will require specific approval from the EPA before they can be sold.

Occupational Safety and Health Administration (OSHA) Compliance

You’ll need to ensure that your workplace, especially in the manufacturing process, complies with OSHA regulations to provide a safe working environment.

OSHA’s regulations aim to ensure the safety and health of workers by minimizing workplace hazards, particularly when handling chemicals or operating in industrial settings.

In particular, this will require your business to ensure that workspaces are safe, well-maintained, and ergonomically sound in order to prevent injuries.

Environmental Compliance Permits

If your green cleaning products business will offer any services that could impact the environment, you will likely need to secure some sort of environmental compliance permits.

For example, if you’re mixing and packaging products in-house, especially in a home-based or small facility, you may need a permit from the local health department to ensure your workspace meets hygiene and safety standards.

The Environmental Protection Agency (EPA) provides guidelines and oversees the issuance of these permits on a federal level, though it’s important to note that some states can also impose their own regulations.

Step 7: Get Business Insurance

In addition to securing the necessary permits and licenses, you will need to obtain the right business insurance.

Note

Even if you form an LLC, purchasing business insurance is still a good idea. This is because an LLC structure protects your personal assets, not your business’s.

While specific coverage needs may vary based on factors such as location, size, and unique risks, there are several key types of insurance that most green cleaning products businesses should consider.

We’ve briefly outlined these below.

General Liability Insurance

General liability insurance is a foundational coverage that’s essential for green cleaning products businesses because it protects against claims of bodily injury, property damage, and personal injury that may be caused during landscaping work.

An example of this might be if a customer suffers an allergic reaction to one of your products or if your product causes damage to someone’s property — in either of these cases, general liability insurance would cover the costs.

The average cost for general liability insurance according to recent data is $42 per month, or $504 annually, though costs can vary based on your business’s specific needs and risks.

Commercial Property Insurance

Property insurance is essential for safeguarding your green cleaning products business’s equipment, raw materials, and inventory, against risks like fire, theft, or natural disasters.

The median cost for business property insurance is approximately between $500 and $2,500 per year. Having said that, rates can vary significantly based on factors such as your business’s location, risk profile, and the value of the property in question.

Product Liability Insurance

Product liability insurance is specifically designed to cover claims related to defects in your products, such as contamination, improper labeling, or safety hazards.

If someone uses your cleaning products and experiences harm, such as a skin irritation, or if your product doesn’t perform as intended, this insurance can help cover the legal and financial repercussions.

While specific figures can vary greatly, it will typically cost medium-sized businesses between $400 and $1,500 per year, though larger businesses may need to pay upwards of $5,000 per year.

Workers’ Compensation Insurance

If your green cleaning products business will have employees, workers’ compensation insurance is likely going to be a legal requirement depending on your state.

This insurance policy provides coverage for medical expenses and lost wages to employees who are injured during work.

The average cost of workers’ compensation insurance ranges between $45 per month, but this can vary based on factors such as payroll, location, and (once again) your business’s specific risk profile.

Ready to Get Started?

How to Start a Green Cleaning Products Business FAQs

Who is the target market?

The target market for a green cleaning products business includes environmentally conscious consumers looking for non-toxic, eco-friendly alternatives to traditional cleaning products.

It may also even extend to individuals who are sensitive to harsh chemicals, as well as businesses such as cleaning services, hotels, and schools that are seeking sustainable cleaning solutions for their operations.

How does a green cleaning products business make money?

A green cleaning products business makes money on the sale of each eco-friendly cleaning product to a consumer or business by taking advantage of bulk buying discounts.

Revenue is generated through direct sales via an online store, physical retail locations, or through wholesale partnerships with retailers or service providers that require sustainable cleaning solutions for their customers.

How much can you charge customers?

The price you can charge customers will depend on factors like your production costs, packaging, and market demand.

Generally, eco-friendly cleaning products command higher prices due to the use of sustainable ingredients and materials, with typical prices ranging from $5 to $20 per item (depending on product type, size, and quality).

How much profit can a green cleaning products business make?

While most eco-friendly cleaning product businesses turn a profit in the first year, it generally takes three years to build a well-established business.

It’s not uncommon for business owners who are committed to their cause and maintain a pulse on the latest trends to report a six-figure profit after the third year.