A frozen dozen pierogi costs $5.04 in dough, potato and farmer's cheese, the bag, eight minutes of pinching and the card fee, and sells direct for $14.00, a 64% margin. Grocers pay $9.00, which keeps 48.7%; a market plate of six with onions and sour cream keeps 59.7%; and a catering tray of 50 keeps 60.5%. Pinching is the biggest cost, more than the ingredients. Margin = (price − cost) ÷ price. In the example below, a month of four lines brings $9,300 of sales and about $5,250 of gross profit, before kitchen hours and the owner's pay.
The short version
- Margin = (price − cost) ÷ price; markup = (price − cost) ÷ cost.
- A frozen dozen, direct: $5.04, sold for $14.00, 64%.
- Pinching costs more than the dough and filling.
- Grocers keep 48.7%.
- Market plates and catering trays add cooked sales.
- TaroStack costs each dozen from what each batch used. More below.
A dozen, costed
Avondale Pierogi Co., the made-up pierogi maker in Chicago, Illinois, I use in these examples, counts pinching time at $20 an hour:
| A frozen dozen, direct | Cost |
|---|---|
| Dough and filling | $1.50 |
| Bag and label | $0.45 |
| Pinching, 8 minutes at $20 an hour | $2.67 |
| Card fees, 3% of $14.00 | $0.42 |
| Cost | $5.04 |
The dozen's price is in how to price pierogi, and the business's year in pierogi business plan.
Margins by channel
| Product | Sold where | Price | Cost | Gross profit | Margin |
|---|---|---|---|---|---|
| Frozen dozen | Market and pickup | $14.00 | $5.04 | $8.96 | 64% |
| Frozen dozen | Grocers | $9.00 | $4.62 | $4.38 | 48.7% |
| Market plate of 6, with onions | Market | $10.00 | $4.03 | $5.97 | 59.7% |
| Catering tray of 50 | Events, invoiced | $75.00 | $29.61 | $45.39 | 60.5% |
The market plate keeps 59.7%, cooked to order; the catering tray keeps 60.5%.
A month's numbers
A month for Avondale Pierogi Co.:
| Product | Units | Sales | Gross profit |
|---|---|---|---|
| Frozen dozen, market and pickup | 150 | $2,100 | $1,344 |
| Frozen dozen, grocers | 400 | $3,600 | $1,752 |
| Market plate of 6, with onions, market | 300 | $3,000 | $1,791 |
| Catering tray of 50, events | 8 | $600 | $363 |
| Month | $9,300 | $5,250 |
The market plates bring the most gross profit, a little ahead of the grocers' 400 dozens at 48.7%. The plates come from one stall on Saturdays. At a thousand dozens a month to grocers, a co-packer's cost would beat more hands, in frozen food co-packer.
Get the calculator
Download the pierogi margin calculator. One sheet: one line for each product and channel, with its price, materials, packaging, labor and fee rate; the cost, gross profit, margin, markup and the price your target margin needs fill in. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
The calculator holds one cost per dozen. Potato and cheese prices move, a holiday rush brings in slower hands, and pierogi that crack in the freezer change every margin.
How TaroStack does it
TaroStack costs each dozen from what each batch used, so margins sit on real cost.
True cost from the batch. Each batch takes flour, potatoes and farmer's cheese at the price of the deliveries they came from, so a price rise shows in the next batch's cost.
Labor on the batch. The minutes a batch took are recorded on it, so the hours behind each product are on record.
Margins by product. Margins are reported per product on that actual cost, and a price-creep report per supplier shows whose prices moved.
| The job | Spreadsheet | In TaroStack |
|---|---|---|
| What a dozen cost | One price from last season | Cost from the batch's deliveries |
| The hours behind a batch | Remembered | Labor minutes on the batch |
| An ingredient creeping up | Noticed late | A price-creep report |
| Margins by product | Re-worked by hand | Margins on real cost |
Recipes, batches, costing and margin reports are on every plan, from $49 a month. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.