Will follows up with this question: Regarding Patrick's post below mine about the cheapest lotion, that made me wonder, what would be the cheapest one? Olive oil and glycerin with E-Wax maybe? I see big bottles of lotion at the dollar stores and never bothered to look at one of them - maybe I should for cheap inspiration.
It depends on what you are seeking in a lotion. You've hit it on the head, Will - I would think the cheapest one I could make would be a combination of soy bean oil, rice bran oil, or olive oil and glycerin (I pay about $8.00 for 1 litre of each of these oils.) The one down side is the greasiness of each of these oils. To get a less greasy combination, you'd have to move to something like avocado, jojoba, hazelnut, or camellia seed oil and those aren't cheap (about $20 to $30 a litre). I'd look at adding 2% IPM to the product to reduce the greasiness (which is about $8.50 a litre or so), which would be more cost effective than using any of the drier feeling oils. (Although having said this, fractionated coconut oil isn't that much more expensive than the others, which could give you a lighter lotion with less greasiness, but you wouldn't be getting all those lovely phytosterols and polyphenols from our oils.)
For thickening, coconut oil is cheaper than any of our butters. It's about $7.00 a pound, so it's cheaper than any of our butters (which can range from $11 to $16 per pound). Stearic acid and cetyl alcohol are both really inexpensive - about $3 a pound - so thickening with these ingredients rather than a butter might be a better bet.
And we could use water instead of all our fancy hydrosols (distilled water is $2.00 for 4 litres). So what would this look like...
BUDGET CONSCIOUS LOTION RECIPE (rounded up)
(from this post)
65% distilled water - $0.04
3% glycerin - $0.03
15% oil - soy bean, rice bran, olive oil - $0.12
5% coconut oil - $0.08
3% cetyl alcohol - $0.01
2% IPM - $0.02
5% emulsifier (BTMS or Polawax) - $0.10
COOL DOWN PHASE
1% fragrance or essential oil - variable, about $0.05
0.5% to 1% preservative - liquid Germall Plus - $0.05
(This doesn't total 100% because of the difference in preservatives!)
This works out to about $0.50 for this lotion, which would make a really great body lotion. Tweak it with stearic acid (about the same cost) and you've got yourself a nice body cream.
The one down side is that it would be a fairly greasy lotion with these oils but we can bring it down with the IPM. You could go as high as 5% IPM and get a less greasy feeling lotion (cost about $0.01 per gram). You could use BTMS instead, which would bring the cost up to $0.15 for the emulsifier and up to $0.55 per 100 gram batch of lotion.
This hobby of cosmetic chemistry isn't a cheap one - I haven't factored in how much the container would cost or how much bandwidth you might use sending out pictures of your new awesome lotion to your friends - and it's understandable that we get upset when we make something we don't like or create a messy goo instead of a lotion! Having said all of this, it's easy to understand why the larger companies use mineral oil. The costs can really add up!
As a secondary thought, with all that inexpensive distilled water in there, you can see how lotions generally cost less to make than anhydrous products! Consider the cost of a whipped butter ($1.75 or so for 50 grams, which should fill a container 100 ml container) or a lotion bar (tired of doing math now, but you can figure it out!) vs. a lotion in the same container.
As a note, all of these amounts are based on buying about 1 litre or 1 pound of the ingredient in question from a few different Canadian retailers. I haven't included the hated HST (at 12%) or shipping costs (because I tend to drive to my retailers). Taxes, shipping, storage, and so on will increase your costs, whereas buying larger amounts will decrease the cost of the product. Your mileage may vary.