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Product Food Costing for small home business

Costing

You will be the one to determine the correct cost of your ingredients but I will just give you an example.

1. You have to determine the total cost of the ingredients you use. Example if you purchased your sugar at 100 for 1kilo and you used 100 grams for that batch then the cost of sugar you used for that batch will be 10 pesos (100/1000 grams = 0.1 pesos per 1 gram. 0.1 pesos x 100g (the weight you use in your recipe) = 10 pesos/100grams used. Do the same for the rest of your ingredients then total everything.

2. You have to include the cost of the packaging used for the product. Example 1 styro tray cost 10 pesos then you have to add the cost of the styro to your food cost.

3. Food and packaging cost, if your total food cost is 100 pesos then add the 10 pesos cost of packaging the total cost will be 110 pesos. How would you determine your selling price?

4. The Food and packaging cost should be 40% of your selling price

5. You multiply the total cost with 147% the result of that add it to your total cost you will be able to determine your selling price.

Example 110 total cost x 147% = 161.7 (round it to 162)

162 + 110 = 272 as your selling price

Check if your total cost is 40% of the selling price

110/272 = 40%

so the 162 should be 60%. Then from 162 you deduct the following expenses:
10% labor cost
2% electricity cost
2% water cost
2% gas cost
2% marketing
2% wastage
2% product improvement/development
total = 22%

you still have 38% as your profit or 61 pesos ang malinis mo na tubo. Natanggal na lahat ng gastos. So if lumabas na zero or negative ang amount then nagpapakahirap ka lang gumawa pero wala ka talagang kinikita.

The percentage given is just an example it depends on the business how you will get those targets. The higher the cost you put into one area the lesser profit you will get.

I HOPE THIS HELPS.

If you want to get a free copy of the food costing template you can send your request to motherbee@newbeebakingandcooking.com or you join our Facebook group Newbee baking and cooking and get the template from the group files.

MotherBee is a kiwi vlogger who loves to experiment with food and baked products. This is her channel where you can find her tips, tutorials, recipes, stories, and adventures.

A Food Technologist with more than 25 years of experience in the food industry both New Zealand and in the Philippines. As a passionate baker by heart with a scientific mind, she created a fast-growing Facebook Baking and Cooking Group with almost 418,000+ members around the globe. She is fondly called MotherBee by most members – and for a good reason. She is like the mother hen of the brood, but in her case, she takes care of a huge hive. Newbee Baking & Cooking began as a small group of newbie bakers who came together to search for answers to their most frequent baking questions and to get more information from Motherbee.

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