Soup is cheap to make and heavy to move. A quart of vegetable soup costs about $2.95 in ingredients, container and label, and sells for $8.50 to a co-op or $14 at a market, so the margin is there. The plan turns on everything around the pot: kitchen hours, because soup is cooked in big batches and has to be cooled fast before it's packed; cold space, from the walk-in to the van; delivery, since co-ops, subscribers and cafés all want it brought to them; and the season, because soup sells best when it's cold out. A mix of channels evens out the week: co-ops for volume, markets for margin, a monthly subscription for steady cash, and gallons for cafés' soup of the day. The plan below works per container. In the example, a Vermont soup maker starts with $36,300, ends its first year about $24,500 ahead before the owner's pay, and makes about $5,700 a month at full speed. Below is each part of the plan, the first year month by month, the startup budget, and a free template.
The short version
- Describe the business in a paragraph: the soups, who buys, where you'll cook, the goals.
- Cost each container: ingredients by the batch, divided by the quarts it fills, plus container, label and card fee.
- Plan sales by channel: co-ops, markets, subscriptions and café gallons.
- Kitchen hours and a helper's wages are the fixed costs that decide the month.
- Plan for the season: soup sells in the cold months.
- Budget working cash for the slow first months, and check it against the lowest cash point.
- TaroStack makes each soup a recipe and each pot a batch, so a quart's cost follows the price of squash. More below.
Part 1: the business description
Mill Race Soup Co., a made-up soup maker in Burlington, Vermont, writes:
Mill Race Soup Co. makes vegetable and bean soups in a shared commercial kitchen, sold in refrigerated quarts to food co-ops, in quarts and pints at the winter farmers market, by monthly subscription with delivery, and by the gallon to cafés for their soup of the day. In its first year it aims to reach $18,500 of sales a month.
Part 2: what a container costs
| Container | Ingredients | Container and label | Delivery | Card fee | Cost | Price | Cost share |
|---|---|---|---|---|---|---|---|
| Quart to a co-op | $2.40 | $0.55 | $2.95 | $8.50 | 34.7% | ||
| Quart at the market | $2.40 | $0.55 | $0.42 | $3.37 | $14.00 | 24.1% | |
| Pint at the market | $1.20 | $0.40 | $0.24 | $1.84 | $8.00 | 23.0% | |
| Subscription, four quarts | $9.60 | $2.20 | $3.00 | $1.56 | $16.36 | $52.00 | 31.5% |
| Gallon for a café | $9.60 | $1.00 | $10.60 | $30.00 | 35.3% |
The ingredients are the batch's cost divided by the quarts it fills: a 40-gallon batch of butternut squash soup, about 150 quarts after cooling and portioning, at $360 in squash, onions, coconut milk, stock and spices. Cooling a batch that size fast enough takes shallow pans or an ice wand, and a log; the log is in cooling log template, and kitchen time in shared kitchen pricing.
Part 3: customers and schedule
The kitchen runs two long days a week, about 80 hours a month. Co-ops order weekly, by the case, with at least a week of shelf life left at delivery. The winter market runs Saturdays from November to April. Subscribers get four quarts on the first Thursday of the month. Cafés take a gallon or two a week each.
Part 4: what each channel earns
| Product | Price | Variable cost | Contribution | Margin | Units a month at full speed |
|---|---|---|---|---|---|
| Quart to co-ops, wholesale | $8.50 | $2.95 | $5.55 | 65.3% | 800 |
| Quart at the market | $14.00 | $3.37 | $10.63 | 75.9% | 300 |
| Pint at the market | $8.00 | $1.84 | $6.16 | 77.0% | 200 |
| Soup subscription, four quarts a month | $52.00 | $16.36 | $35.64 | 68.5% | 80 |
| Gallon for cafés | $30.00 | $10.60 | $19.40 | 64.7% | 60 |
At full speed the business sells $18,560 a month and keeps $12,876.20, 69.4%; co-op quarts bring $4,440 of it, and the 80 subscribers $2,851.
Part 5: the first year, month by month
Fixed costs are $7,200 every month: shared kitchen hours ($1,600), wages for one helper ($4,000), market fees ($300), insurance ($200), van fuel and upkeep ($350), freezer storage ($250), software ($50), ads ($200), and other costs ($250). Sales start at 35% of full speed:
| Month | Sales | Profit | Cash, year to date |
|---|---|---|---|
| 1 | $6,496 | −$2,693 | −$2,693 |
| 2 | $7,810 | −$1,782 | −$4,475 |
| 3 | $9,072 | −$906 | −$5,381 |
| 4 | $10,416 | $26 | −$5,355 |
| 5 | $11,678 | $902 | −$4,453 |
| 6 | $12,992 | $1,813 | −$2,640 |
| 7 | $14,306 | $2,725 | $85 |
| 8 | $15,568 | $3,601 | $3,686 |
| 9 | $16,704 | $4,389 | $8,075 |
| 10 | $17,632 | $5,032 | $13,107 |
| 11 | $18,560 | $5,676 | $18,783 |
| 12 | $18,560 | $5,676 | $24,460 |
The year's sales are $159,794, and the business ends it $24,460 ahead, before the owner's pay. It breaks even at about $10,380 of sales a month, in the fourth month. The lowest cash point, −$5,381 in month 3, is well inside the $12,000 of working cash. The plan treats every month alike once sales are built up; a soup business sells less in July than in January, so change the shares in the workbook's second row for the summer months, and keep the working cash for them.
Part 6: the startup budget
| Item | Example |
|---|---|
| Used cargo van, insulated | $14,000 |
| Stockpots, blenders and smallwares | $2,500 |
| Chest freezers and market display | $2,000 |
| Containers and labels, first order | $1,500 |
| Website and branding | $1,500 |
| Opening inventory | $1,000 |
| Licenses and permits | $800 |
| Insulated delivery bags | $600 |
| Label printer | $400 |
| Working cash | $12,000 |
| Total to start | $36,300 |
The $24,300 before working cash is earned back in under five months at full speed. Whether soup can start in a home kitchen instead is in can you sell soup from home, and the licensed kitchen in shared kitchen license.
Get the template
Download the soup business plan workbook. Four sheets: your products, each with its price, variable cost and units a month at full speed; the first year, month by month, with sales ramping up, profit, cash, the first profitable month, the lowest cash point and whether the working cash covers it; your fixed costs; and the startup budget. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
The plan uses one cost a quart. The kitchen uses a different one every batch: squash prices move with the season, one batch fills 150 quarts and the next 138, and the co-op sends back a case that went out with too little shelf life left.
How TaroStack does it
TaroStack makes each soup a recipe and each pot a batch, so a quart's cost follows the price of squash.
Soups as recipes. Each soup is a recipe by weight, and each batch records the quarts it actually filled, so a quart's cost comes from that batch.
Lots with dates. Each batch is a lot with its date and use-by date, and a co-op can be set to take only quarts with at least a week left.
Deliveries by lot. Each co-op, subscriber and café delivery carries its lots, so a recall reaches every customer who got that pot.
| The job | Notebook | In TaroStack |
|---|---|---|
| What a quart costs this batch | Worked out once | True cost from the batch |
| Quarts with enough shelf life for the co-op | Checked by hand | The customer's shelf-life rule |
| Who got a bad pot | Delivery slips | One recall report |
Recipes, batches, lots and recalls 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.