Please or to access all these features

Work

Chat with other users about all things related to working life on our Work forum.

Help! How do I work out my costings please?

2 replies

Doughnut123 · 07/05/2014 21:26

Hi all, I am in need of help please from anyone who has their own small business. I am just starting up a small business making preserves and cakes. My problem is that I am hopeless at maths. I can do the basic cost of my ingredients and then add my time on, but I've heard that you need to divide the cost into 1/3 each for ingredients, labour and profit.
I am befuddled. Please can anyone advise me ? Thank you.

OP posts:
Lonecatwithkitten · 07/05/2014 22:08

There is a rule of thumb that total sale price is one third raw materials, one third time, one third profit roughly.
So if your raw ingredients cost £3, your time to turn it into new product is £3, sale price would be £9 giving a profit of £3. However, some of this depends on your skill set. In my business professional skill makes up 60% of sale price as it is a highly trained skill set.

Doughnut123 · 08/05/2014 07:52

Thanks alone at. I'll try that.

OP posts:
New posts on this thread. Refresh page