Recipe Pricing
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Pennies for Profit:How to Cost Recipes
CorrectlyJeff Ware
March 10th, 2013
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Session Agenda Why you need proper recipes Knowing & tracking your costs Understanding recipe construction
◦ batch vs. recipe vs. complete recipe vs. menu/pkg
◦ standards and consistency
Different ways to do it
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Started with CBM at 14 Electrical Engineering/
Computer Science Background
Worked at CNN & theatres Learned other aspects of live events
Fell in love with food thanks to this job
My Story
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Founded in 1980 as a hot dog stand
Catering spun off into separate company in 1991
Peak revenue of $17 Million 90 FT & 130 PT Employees 45% Full Service / 35% On
Premise / 20% Delivery
CBM 101
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Largest event $1.3 million Focused on food quality
above all else Poor facility design
challenges efficiency Non Chicago address is a
marketing struggle
CBM 101
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394 Vendors 3,220 Inventory Items 13,308 Recipes
◦ Largest known database in existence
3 FT Staff dedicated to managing the database 15,381 photos (432 GB)
Recipes @ CBM
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Consistency in your product Selling based on true costs Consistency in sales force pricing Keep profit margins where they need to be Smart purchasing decisions Historical data = forecasting trends
◦ Caterers are selling for the future
Why you need proper recipes
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Know your loss What is useable
product Proper units of
measure floz ≠ oz
Knowing & Tracking Your CostsIT ALL STARTS WITH INVENTORY
Loss from cleaning Loss from
cooking/reduction ‘Useable Product’
loss
Brisket – Start with 100# received1. Lose 38% in cleaning – now 62#2. Lose 39% in cooking – now 37.82# saleable3. Lose 12% in scrap/trim from slicing
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Units of Measure
OZ• Chicken• Mayo• Flour
Weight is always better than volume unless it is a liquid
Can use weight to confirm yield
FLOZ Water Vodka Chopped Herbs
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Inventory Setup
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1. Batch2. Recipe3. Complete Recipe4. Menu/Package
Understanding Recipe Construction
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1. Batch2. Recipe3. Complete Recipe4. Menu/Package
Understanding Recipe Construction
Cooked Rice
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1. Batch
2. Recipe3. Complete Recipe4. Menu/Package
Understanding Recipe Construction
Sushi Roll
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1. Batch2. Recipe
3. Complete Recipe4. Menu/Package
Understanding Recipe Construction Sushi Roll w/ Sauce
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1. Batch2. Recipe3. Complete Recipe
4. Menu/Package
Understanding Recipe Construction Sushi Roll Assortment
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Tap Water Fryer Oil Packaging Skewer Garnish Loss
Include All Costs
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Food Cost◦ 30% Labor◦ 30% Overhead◦ 30% (or less) Food Cost◦ 10% to pay sales commission and profit
Any average food cost 20%-30% is okChipotle is at 33.5%
Pricing Party
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Pastry @ 20%◦ So much additional labor◦ Passed apps also good at 20%
Proteins can be up to 50%◦ What can your market bear
Cheap items @ lower FC% (8%-16%)◦ Potatoes, Rice
Anything bought & resold @ 50% Packaging @ 50%
Pricing Party
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Consistent Increase
Annual Price Jump
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Database (designed for recipes) – BEST◦ Designed for this use◦ Instantly recalculate recipes◦ Relational data◦ Expensive start up cost
Database (not designed for recipes) – OK◦ Relational Data◦ Lacks functionality◦ Takes a lot of time to setup
Other – POOR◦ Low start up cost◦ Very expensive in the long run◦ Data is flat – not linked throughout
Ways to do it
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Adjust or change ingredients Adjust yield and portion Better purchasing
Reduce Costs
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Enforce Good Data Collection
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Check Accuracy Ingredients + loss = yield All costs included Ingredients are logged
properly
Ingredients listed in order of use
Method written so a person with no experience could do
Use standards – Medium Dice, Brunoise, etc
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To download a copy of this presentation, go to:slideshare.net/CateringChicago
Jeff [email protected] | (847) 966-6555
Questions?