Making it for somebody else
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Lip balm is the classic promotional and private-label product, and that market is larger than the retail one.
A genuinely good fit
Small, cheap per unit, ordered in thousands, and a label is the entire differentiation. A hotel, a wedding, a conference, a brand that wants a giveaway.
It is steady work at a known volume with no shelf risk, which is the opposite of every other channel in this category.
What they are buying
Usually a stock formula with their artwork on it. Rarely a bespoke product, and if they ask for one, price the development separately.
They are also buying a deadline. A conference date does not move, and a late delivery is a total failure rather than a delay.
So the real question is not whether you can make it. It is whether you can make 5,000 by a fixed date with no margin for a grained batch.
What to agree
Quantity, unit price and the date, obviously.
Who supplies and pays for artwork and labels, and who approves the proof.
What happens to overrun and to short delivery, because label minimums mean there will be one or the other.
And what claims they may make in their own marketing, which is the clause nobody writes: a client promoting your cosmetic balm as a remedy for chapped lips has created a drug with your product inside it.
Whose name is on the label
The label carries the manufacturer, packer or distributor. Being the maker without being named does not remove your responsibility for what you made.
Check your insurance covers it. Product liability policies quite often treat private-label work differently, and that is worth finding out before the order rather than after.