I get asked all the time why there are such wild differences in essential oil prices. Since it can be hard to explain essential oil prices unless you know exactly which oils are being compared or specifically what the question is, I decided to write up this handy guide to help you figure this all out.
I will let you know why some oils are more expensive than others and also why the “same” oils differ in price between suppliers. First, let’s look at why essential oil prices differ between suppliers.
Different Supplier-Different Essential Oil Prices
To really understand how essential oil pricing works we have to look at several different factors. First, let’s look at why some companies charge more for pure essential oils.
If all pure essential oils come from the same plants, why do some companies charge so much more? The answer lies in the sales method the company uses. Some companies, notably Do Terra and Young Living, use Multi-Level Marketing to sell their products. This means that the company sells to an up-line distributor at a profit, and then each person in the downline makes some profit off the sale. Obviously for everyone to make some profit in this type of company the prices will be higher.
It has been reported that the MLM model needs a markup of 16x cost to be profitable. That means for every $1 the product costs the company to buy, the retail price has to be $16. Multiply that by a cost of say $6 for the company, and you are paying $96 to the rep you bought it from at retail.
The problem occurs when they try to tell you that they are the ONLY suppliers of pure essential oils to justify the high prices. This is totally false and misleading. Many companies supply pure and unadulterated essential oils that have been tested by independent laboratories and shown to be pure.
Don’t be fooled by the “we’re the only supplier of pure essential oils” statements to explain the higher prices. That’s simply a smokescreen to explain away the business model.
The other side of this is the rock-bottom essential oil prices you see for some oils at discount stores and online. Many of these suppliers label their products as pure essential oils. Yet what they are actually doing is selling adulterated essential oils. They adulterate their products by using mostly carrier oils such as sweet almond or grapeseed oil and then add a small amount of the essential oil to make it smell like the real thing. They also sometimes substitute a similar-smelling oil for the one on the label. An example is adding Lavendin to Lavender or using rosewood in place of rose essential oil. They may even add laboratory-produced constituents to extend the oils and make more profits.
Here is a quick test to see if the oil you bought was adulterated. Place a drop on the end of your finger and rub it between your fingers. It should not feel oily at all, with only a slight slip. If it feels oily it is most likely adulterated with vegetable seed oil. You can also place a drop on a white sheet of paper. When the oil dries there should not be an oily spot left on the paper, except for a few essential oils. This technique works for any oil except sandalwood, patchouli, vetiver, and German chamomile.
Different Oils- Different Prices
Now let’s look at why oils from different plants may cost so much more than one another. This is another reason for differences in essential oil prices.
Remember, essential oils are distilled or extracted from parts of the plants they come from. They may come from the roots, wood, twigs or, the resin of trees, the leaves, or the flowers. They are not really oils at all. They were given this name because they don’t mix well with water, and the name stuck.
One reason prices vary so widely has to do with the scarcity of the plant. For instance, most sandalwood essential oil comes from Australia now because the sandalwood tree has become endangered in India. The trees are grown sustainably in Australia. However, since the oil comes from the wood and roots there are only so many trees that can be harvested yearly. The tree must be cut down to produce the oil, and it takes some time for the trees to grow. This makes it a relatively expensive oil when you buy pure unadulterated oil. However, if you look at some companies selling at giant online retailers they are selling Sandalwood oil at 2 oz. for around $16. Since the oil costs more to produce than that, and I can assure you they aren’t selling to you at a loss, the only way to sell you sandalwood oil at that price is to adulterate it. So they mix the sandalwood essential oil with a cheap carrier oil and sell it as a pure essential oil. They may not be breaking any laws, but they are for sure misleading consumers who aren’t educated on essential oils.
Another reason for different prices for different oils is the yield. Rose Otto essential oil is a good example of this. It takes the petals of 60 roses to make 1 drop of Rose Otto essential oil. It takes 1200 lbs of rosebuds to get 1 lb. of essential oil. This makes pure Rose Otto one of the most expensive essential oils available.
Compare the prices of 15 ml bottles of Rose Otto vs. Lemon essential oils. A 15 ml bottle of lemon essential oil retails for $10.00. A 15 ml bottle of Rose Otto essential oil retails for $850.00. You get a lot more yield of lemon oil from lemon peels than you get Rose Otto oil from roses.
A few other examples of how much plant material it takes to make essential oils include:
- Peppermint- 600 lbs of leaves and flowers for 2 lbs of oil.
- Tea Tree- 1,000 lbs of leaves and twigs for 18 lbs of oil.
Another reason for differing prices can be the labor required for harvest and distillation. In my rose example, the roses also must be harvested by hand, and they have to be harvested in the early morning while the dew is still on them. Only enough roses can be harvested for the distillation process for that day. If they begin to dry out the yield of oil drops to negligible and the quality drops way down.
As you can see, there are several reasons for the differences in prices between oils from different plants and also oils from different companies.
Conclusion
I hope this has helped you to understand essential oil prices better. My hope is that it will help you make an informed choice when choosing to buy essential oils.
Be sure and check out our list of articles for more great information on aromatherapy and essential oils.
FAQs:
Q: How do you calculate the price per drop of essential oils?
A: To calculate the price per drop of essential oils, you will need to divide the total cost of the bottle of essential oil by the number of drops in the bottle. For example, if a 10ml bottle of essential oil costs $20 and contains 200 drops, the price per drop would be 20/200= $0.10 per drop.
Q: How can you tell if an essential oil is high quality?
A: High-quality essential oils should have a few key characteristics, such as being 100% pure, having a strong and natural scent, and being extracted using the proper methods. Check for certifications or tests to ensure that the oil is of good quality. Also, look for oils that come from reputable and transparent suppliers who provide detailed information about their production and quality control processes.
Q: Why are some essential oils so cheap?
A: The price of essential oils can vary depending on several factors, such as the type of plant used, the method of extraction, the location of production, and the availability of raw materials. Cheaper oils may have been produced using lower-quality materials or processes or may have been diluted with carrier oils or synthetic fragrances.
Q: What are the 4 grades of essential oils?
A: There are no official grades for essential oils, but some companies may label their oils as therapeutic grade, food grade, cosmetic grade, or fragrance grade. However, these labels are not standardized and can be misleading, so it’s important to research the supplier and their quality control practices before purchasing any essential oil.
Q: How much are essential oils on average?
A: The cost of essential oils can vary widely depending on the type of oil, the quality, and the supplier. On average, a small bottle of essential oil (10ml) can cost anywhere from $5 to $30, while larger bottles (100ml or more) can range from $30 to over $100.
Q: Are essential oils costly?
A: Essential oils can be considered costly compared to other types of aromatic products like scented candles or room sprays. However, they are often more potent and have a longer shelf life than other products, so a little goes a long way. Additionally, investing in high-quality essential oils can provide more therapeutic benefits and be a better value in the long run.
Q: Is selling essential oils a pyramid scheme?
A: Not all essential oil companies are pyramid schemes, but it’s important to do your research before buying from any company that operates on a multi-level marketing (MLM) system. MLM companies often prioritize recruitment over product quality, so it’s important to consider the source and quality of the essential oils before making a purchase.
Q: How do you know if essential oils are legit?
A: To ensure that essential oils are legit, look for oils that are labeled as 100% pure and have not been adulterated or mixed with carrier oils or synthetic fragrances. Check for certifications or tests to verify the purity and quality of the oil, and research the supplier and their quality control practices.
Q: What to avoid when buying essential oils?
A: When buying essential oils, it’s important to avoid oils that are labeled as fragrance oils or perfume oils, as these often contain synthetic fragrances and are not pure essential oils. It’s also important to avoid oils that have been diluted with carrier oils or other additives, as these oils are not pure essential oils.
Q: How is oil price determined?
A: The price of essential oils is determined by several factors, including the cost of raw materials, the production process, the quality of the oil, and the supply and demand in the market. Some essential oils require more plant material to produce, making them more expensive than others. Additionally, the method of extraction can also impact the price of the oil. For example, steam distillation is a common method that yields high-quality oil, but it can be more costly than other extraction methods. Finally, market factors such as supply and demand can also influence the price of essential oils.
Q: What is the margin for essential oils?
A: The margin for essential oils can vary depending on the brand, quality, and pricing strategy of the supplier. Some suppliers may charge a higher markup for high-quality, rare, or exotic oils, while others may focus on selling a larger quantity at a lower margin. The cost of production, packaging, and shipping can also impact the margin for essential oils. It’s important to research and compare prices from different suppliers to ensure you are getting a fair price for the essential oils you purchase.