How Much Does It Cost to Start a Supplement Brand?
Budget supplement startup costs strategically
Before you create a logo, come up with a business name, or design a website, it’s important to understand the high-level costs of starting a supplements brand. As exciting as launching a business is, many overlook the upfront investment required and end up with cash flow surprises that derail their plans.
Understanding the major supplement startup costs can help you realistically plan for success, whether you’re choosing private label products or developing custom formulations. Here’s what to budget for when starting your supplement company.
Product Development and Testing Fees
Developing your own custom formulations? Then your first investment will likely be product development. However, even with private label supplements, it’s helpful to budget for quality verification.
Key testing and validation costs include:
Third-party testing: When having potency and purity evaluated, expect to pay per batch tested, with costs varying based on the complexity of your formulation and the number of ingredients.
Stability studies: Studies that determine shelf life and proper storage conditions may require testing over extended timeframes and a significant upfront investment.
Certifications: Certs aren’t legally required, but are encouraged. They build consumer trust and can open retail distribution channels. Premium ones require both upfront application fees and annual renewal costs, making it an ongoing financial commitment.
Manufacturing Costs
Easily one of your most significant cost drivers will be how you manufacture your products. Here it is broken down between private label vs custom formulations.
Here’s what to know:
Private label solutions
Going this route offers the lowest barrier to entry, allowing you to rebrand existing formulations with minimal upfront investment. It requires less capital but lends limited differentiation in a crowded market.
Custom formulations
This approach requires substantially more investment. Beyond formulation development costs, you’re also expected to commit to minimum production order quantities. The latter can tie up significant capital in inventory, making it challenging for bootstrapped founders to manage cash flow. Ultimately, though, it gives you proprietary products and greater quality control.
Building your own facility
There’s also an option to establish your own manufacturing facility, but it’s the most capital-intensive path. This route only makes sense to pursue if you have deep investor backing and you anticipate significant scale. Very few startups actually pursue this initially, but understanding the spectrum helps you plan your growth trajectory and potential exit strategies.
Regulatory Compliance Expenses
Supplement brands operate in a heavily regulated space, with some compliance costs starting before you even sell your first unit.
Core compliance costs that can apply to supplement brands include:
Label compliance: Supplement facts panels must meet exact FDA specifications. Therefore, plan to budget for legal consultation fees during initial design and whenever you update formulations or make new claims.
Advertising review: The FDA scrutinizes supplement marketing, so plan for ongoing legal review of marketing materials before launch.
Be sure to consult a licensed attorney with any regulatory questions or concerns.
Legal Infrastructure
Supplement startup costs also include properly building your company’s legal foundation.
Upfront investments might consist of:
Business formation: Fees for LLC or corporation set up.
Trademark registration: Budget for attorney assistance if navigating the application process yourself proves complex.
Ongoing legal counsel: Regular review is often more cost-effective than waiting for issues to become expensive problems.
Liability insurance: Premiums are higher for supplement brands, but insurance should be considered given the increase in consumer class lawsuits.
Branding and Market Entry
Without proper branding and marketing, getting noticed in the market would be difficult. Consider having a decent budget set aside for:
Professional branding: Packaging design, logo development, and product photography require upfront investment but can directly impact conversion rates and perceived value.
E-Commerce platform: Whether you build on Shopify or create a custom solution, expect costs for design and development.
Customer acquisition/advertising: The supplement space is highly competitive, requiring sustained investment for building brand awareness and customer trust (e.g., social media campaigns, influencer partnerships).
Note: Be sure to review FTC and platform guidelines for advertising and marketing healthcare and wellness products.
Operations and Fulfillment
Many private label and custom formulation manufacturers offer fulfillment services, handling product storage and shipping directly to customers. If they don’t provide this, you’ll need to arrange warehousing through a third-party logistics (3PL) provider or obtain your own storage space.
3PL providers handle inventory management and shipping logistics, helping you avoid the capital requirements of operating your own warehouse. However, they do add per-unit costs that scale with volume.
Technology Infrastructure
Your technological needs will extend beyond your website. Some software and tools you’ll need will include:
Email marketing
Inventory management
Payment processing
Project management
Bookkeeping/accounting
Customer relationship management (CRM)
Subscription billing (if offering recurring orders)
These tools involve both initial setup costs and ongoing monthly subscription fees that scale with your business size.
Staffing Supplement Startup Costs
Staffing & Operating Costs
When planning startup costs, it’s important to budget for the core functions required to launch and run the business. These typically span areas such as creative and brand development, day-to-day operations, customer support, financial management, marketing and growth, product or formulation expertise (if applicable), and regulatory or compliance guidance in a highly regulated category.
Pro tip: Most early-stage companies start by outsourcing these functions to freelancers, agencies, or consultants. As the business grows and revenue becomes more predictable, these responsibilities are often brought in-house over time.
Pair Clinical Programs with Supplements and Launch in a Few Weeks with OpenLoop
Starting your own supplements brand can be a great way to add value and drive more revenue. With OpenLoop, you can do more. Offer clinical programs (like weight loss) paired with supplements all under your brand. We handle all the operations and clinical oversight, you give your audience access to popular treatments with limited, if any, upfront costs.
We are able to provide a completely turnkey, white-label offering thanks to our vertically integrated clinical infrastructure. You and your audience get access to:
Your own branded webpage marketing your products
Limited, if any, implementation costs and high-margin revenue
50-State clinical network so your viewers get care wherever they are
24/7/365 patient support
Unlimited visits with a licensed Certified Medical Assistant (CMA)
Access to treatments like weight loss, HRT, TRT, Longevity and more
Ready to take your brand to the next level? Contact us today.
*This content is intended for general informational purposes only and should not be construed as legal advice. For guidance on your specific situation, please consult a licensed attorney.