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What To Charge Restaurants For Your Baked Goods?

post #1 of 5
8/9/12 at 12:15pm
Thread Starter 
Can anyone help to figure out what to charge restaurants that want to purchase my brownies and cookies for resale at their restaurant? I know I need to make a profit; but don't want to price myself out of their prospective profit.

Thanks so much for your help

Cathy
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post #2 of 5
8/9/12 at 12:53pm
You need three critical pieces of information to make this decision:

A. The market price for the item in question when purchased at the restaurant type in question
B. The restaurant's markup
C. Your cost to produce the item, including ingredients, labor, and allocated overhead

The restaurant will likely be willing to pay A - B. Your profit margin will be (A - B) - C. If this is enough profit for you, go for it. If not, you need to either negotiate a higher wholesale price or reduce your costs (or both).
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post #3 of 5
8/9/12 at 9:53pm
Check with your local HD because you may need a separate wholesale license.

When I wholesale, and I do quite a bit, I only adjust by the time savings. For example, if it is a large volume of the same item, the time savings of doing the same item is all that I will discount. I make the same amount personally whether I retail or wholesale. After you get into the routine, the wholesale beciomes more profitable.

I do not ever work for less than my personal per hour price.

When looking at market price, remember this is for a premium, from scratch item. Even Starbucks does not have this, so be aware that market price may be above the highest prices currently available. Don't undersell yourself.
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post #4 of 5
8/11/12 at 7:55am
Thread Starter 
Thank you both Jason and SCP. I met with the restaurant yesterday; and was able to make a deal that would benefit us bothicon_smile.gif

Jason, gotta ask as I am originally from the OC; where about are you there? I'm in the process of trying to get back there myself after 6 VERY long years in Nebraska!

Again, thank you everyone for your help

Cathy
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post #5 of 5
8/11/12 at 8:42am
Glad you were able to work things out!

We moved to an apartment in Irvine last year to do some house hunting in the area, we finally found a nice property in Brea and moved in a few months ago.
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