Nothing is sold in the quantity you cook with. Suppliers sell packs; recipes consume fractions of packs. Every pricing mistake in a small kitchen starts in that gap.
Price the pack down, never the recipe up
The instinct is to work forward — "this recipe used about half a bag, call it ₱40." That estimate is doing the arithmetic in the least reliable direction, on the least reliable number, and it compounds across every line.
Work the other way. Reduce each pack to a price per base unit once, then multiply by what the recipe actually uses:
- ₱85 for 500 g of flour → ₱0.170 per gram
- ₱240 for 1 L of oil → ₱0.240 per millilitre
- ₱200 for a 30-egg tray → ₱6.667 per egg
Now 80 g of flour is ₱13.60, not "about ₱15." The estimate and the calculation differ by 10% on one line; across a dozen lines, in the same optimistic direction, that's the difference between a healthy margin and none.
Error one: pretending a count is a weight
The most expensive mistake in pack pricing. A tray of 30 eggs at ₱200 is ₱6.67 per egg. If your recipe asks for 165 g of egg, you cannot get there from ₱6.67 without knowing what one egg weighs.
Weigh one. Say 55 g. Then:
- ₱6.667 per egg ÷ 55 g = ₱0.121 per gram
- 165 g of egg = ₱20.00, which is exactly three eggs. Correct.
Treat the tray as "₱200 for 30 units" and let a spreadsheet read those units as grams, and eggs land at ₱6.67 per gram — fifty-five times the real cost. It is a silent error, because the total still looks like a number. Anything you buy by count and use by weight needs a measured per-piece weight recorded once: eggs, bay leaves, gelatine sheets, calamansi.
Error two: costing the yield you cut, not the yield you sell
A tray that cuts into 24 pieces rarely sells 24. Two go to trim, one breaks, one is the one you ate checking it. Divide by 24 and every piece is under-costed by about 9%, forever.
Cost against sellable yield. If the honest number is 21, use 21. Waste is real; the cleanest place to account for it is the divisor, because it needs no separate estimate and self-corrects as you get better.
From cost per serving to a price
Cost per serving is your floor. Getting to a price means deciding a margin, and the two common ways of expressing it are not the same:
- Markup is on top of cost. ₱30 cost + 100% markup = ₱60.
- Margin is a share of the price. ₱30 cost at 60% margin = ₱30 ÷ (1 − 0.60) = ₱75.
People say "60% margin" and calculate a 60% markup, landing at ₱48 instead of ₱75 — a 36% shortfall on every unit sold. Pick one convention and write it down. Margin is the more useful of the two, because it tells you directly what share of revenue you keep.
For food, price = cost ÷ (1 − target margin). At ₱28.88 per serving and a 65% target, that's ₱82.51 — call it ₱85.
Sanity-check against the market, then decide
The calculation gives you the price you need. The market tells you the price you can get. When they disagree, that is the actual business decision, and it has only a few honest resolutions:
- Reduce the cost — supplier terms, pack sizes, less waste
- Change the product so a higher price is credible — portion, packaging, positioning
- Accept a thinner margin on this item deliberately, and know which item carries it
- Stop making it
What doesn't work is pricing at what competitors charge without knowing your own cost per serving. Their pack prices, yields and waste aren't yours. Plenty of businesses have matched a competitor's price and discovered the competitor was losing money too.
Keep it current
Pack prices move, and a price per serving calculated in January is a January number. Store one price per ingredient and derive recipe costs from it, so that when the flour price changes you update one field and every affected price follows. A costing model you have to redo by hand is one you'll stop redoing.