Help with Pricing by the LB

A quick way to come up with pricing is to multiply your costs by 3, this will give you a 33% food costs which is pretty standard.

So, you will need to calculate the yield on each of those meats you listed by dividing (what you actually paid for the meat) by (how many pounds you have after it is cooked.)

If you paid $45 for a 15 pound brisket ($3/pound) but only have 8 pounds of usable meat after it is cooked then your yield cost is $5.63/pound ($45/8 lbs). $5.63*3 = ~$16.88/lb sales price.

If you wanted a different food cost, simply divide your total cost by that percentage.

30%= $5.63/.3 = $18.77 selling price.

Hope that helps!

Jhood said:

A quick way to come up with pricing is to multiply your costs by 3, this will give you a 33% food costs which is pretty standard.

So, you will need to calculate the yield on each of those meats you listed by dividing (what you actually paid for the meat) by (how many pounds you have after it is cooked.)

If you paid $45 for a 15 pound brisket ($3/pound) but only have 8 pounds of usable meat after it is cooked then your yield cost is $5.63/pound ($45/8 lbs). $5.63*3 = ~$16.88/lb sales price.

If you wanted a different food cost, simply divide your total cost by that percentage.

30%= $5.63/.3 = $18.77 selling price.

Hope that helps!

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This seems to be a good way to do the pricing. I've looked at what my area vendors sell for and use that as part of my pricing considerations, too. I don't want to over price a product but I also don't want to be well under what the market sells the same product for.

JHood forgot to add in the other cost like fuel, rub and misc then take times 3. But if you only want to be competitive charge what others in your area are charging.

poorolddan makes a good point, you should include all of your expenses in that formula.

I would encourage you to still use this formula with what you found in your market. They could be getting a deal on something and assuming you don't know what they are paying for their product, it could be misleading.

I would like to add you will ALWAYS have someone that complains about your prices. Dont let it deter you from what you feel your price should be. I had one local new food vendor use my prices, publicly said they were to high so low-balled me on prices. 3 weeks later he raised his prices and they were higher than mine.

Another story...I do not live close to a Sams, Costco or the such. A minimum 2 hour drive. So one day a "friend" who lives and vends in a bigger area(He once told me 3 Sams and a Costco in a half hour drive) once commented on my prices more than his ie. $6 sandwich where he says he cant charge more than $4. My comment was I gotta drive so thats gas, wear and tear and my time that goes into the amount I charge.

I want to add I also might charge less per pound on one item than what I should if I feel it gets "someone in the door" and get more on a higher markup. Example on vending Brisket we may get $14 a pound cooked typically. But only cook a specific amount however I charge $5 a chicken hindquarter. Seldom does anyone just get a pound of brisket but they will buy other stuff as well such as the high profit hindquarter or a pound of pulled pork or pork loin etc. But the Brisket gets them there.

poorolddan said:

JHood forgot to add in the other cost like fuel, rub and misc then take times 3. But if you only want to be competitive charge what others in your area are charging.

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Fuel, rub and misc all come out of the remaining 70%. They should not be considered part of your food cost.

"I would give it away, but my wife won't let me."

Later,
Doug

Bbq Bubba said:

Fuel, rub and misc all come out of the remaining 70%. They should not be considered part of your food cost.

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I'd agree that maybe RUB should be considered when pricing via the "divide by desired FC%" , but fuel and Misc (ie rent, supplies, insurance, electric, and on and on and on) are different line items and the cost of doing business. That's why they say "the quickest way to get a Million Dollars is to take THREE Million Dollars and open a restaurant".:grin:

As a guide, here are prices for our area from a local vendor........

But keep in mind; different vendors use different suppliers, prices and quality can vary drastically when the products are compared side by side. There is no substitute for quality!

PULLED PORK 10.99 lb
PULLED CHICKEN 11.99 lb
BEEF BRISKET 18.99 lb
SMOKED SAUSAGE 11.99 lb
SAUCES & SIDES - 1/2 Pint 2.75 - Pint 5.49 - Quart - 10.98

http://www.wholehogcafe.com/documents/menus/Whole%20Hog%20Cafe%20Menu_To%20Go_NJ_2016_04_07_Med.pdf

The cost x 3 factor as far as I'm concerned should be considered the "Minimum" you should charge for something. There are too many other factors to just charge that amount. For instance if I can cook 4lbs pork chops on a grill in less than an hour should that be worth the same amont as cooking 4lbs of pulled pork which takes 6-14hrs depending on your cooking methods? Those other factors need to be consider IMO. Also for me, if it goes into someones mouth and gets swallowed then I consider it food cost.