Most caterers think ready-made components automatically save money - but that's often wrong. You might buy pre-baked quiches or ready-made salads thinking you're cutting costs, but your profit margins could be shrinking fast. The real question isn't whether these products save time, but whether they actually make you money.
Why this calculation matters more than you think
As a caterer, you're juggling homemade dishes with purchased products daily. But here's the trap: ready-made components appear cost-effective until you realize your margins have quietly evaporated.
⚠️ Note:
Most caterers focus only on the sticker price of ready-made products. They overlook labor time, packaging costs, and overhead - which completely skews the real profitability picture.
The full cost breakdown you need
For an honest comparison, you've got to factor in every single cost:
- Purchase price: What you're paying per unit or kilo to suppliers
- Processing time: Heating, plating, garnishing - it all adds up
- Packaging costs: Containers, labels, takeaway bags
- Overhead: Your share of rent, utilities, insurance
💡 Example: Ready-made quiche breakdown
You're selling a quiche for €8.50 (incl. 9% VAT):
- Selling price excl. VAT: €7.80
- Purchase price quiche: €3.20
- Heating + garnishing: 3 min × €18/hour = €0.90
- Packaging: €0.25
- Overhead (15% of revenue): €1.17
Total costs: €5.52 = 70.8% of revenue
That leaves you with just 29.2% margin. For most catering operations, that's dangerously thin.
Stack it against homemade costs
To figure out if buying makes financial sense, you need the real cost of making it yourself:
💡 Example: Same quiche, made in-house
Ingredients and labor for 1 quiche:
- Ingredients: €2.10
- Prep time: 15 min × €18/hour = €4.50
- Packaging: €0.25
- Overhead: €1.17
Total costs: €8.02 = 102.8% of revenue
Suddenly, that ready-made quiche doesn't look so bad - even with the slimmer margin.
Smart scenarios for ready-made products
Ready-made components make the most sense during:
- Rush periods: When your kitchen's at maximum capacity
- Specialty items: Products outside your core expertise
- Low-volume offerings: Items you only sell occasionally
- Seasonal additions: Temporary menu expansions
One of the most common blind spots in kitchen management is assuming all ready-made products hurt profitability equally. But some actually free up your team to focus on higher-margin items.
⚠️ Note:
Review supplier pricing monthly. Costs creep up gradually, and many suppliers don't proactively announce increases.
Target margins for catering success
A sustainable catering business needs 35-40% net margin minimum after all expenses. Your total costs shouldn't exceed 60-65% of what customers pay.
💡 Example: Reverse-engineer your pricing
Total costs for ready-made salad: €4.20
Targeting 40% margin:
- Minimum price excl. VAT: €4.20 ÷ 0.60 = €7.00
- Minimum price incl. VAT: €7.00 × 1.09 = €7.63
Round up to: €7.65 on your menu
Streamline your cost calculations
Crunching these numbers manually eats up valuable time. Tools like KitchenNmbrs can help you:
- Automatically factor in purchase, labor, and overhead costs
- Compare homemade versus purchased options instantly
- Track real-time margins across your product range
- Update calculations when supplier prices change
This keeps you informed about which ready-made components actually boost your bottom line.
How do you calculate the margin of ready-made components?
Gather all costs per product
Note the purchase price, time for processing (heating, garnishing), packaging costs and a portion of your overhead. Don't forget any cost item.
Calculate your total cost price
Add up all costs and divide by your selling price excluding VAT. This gives you your cost percentage. Subtract this from 100% for your margin.
Compare with homemade
Also calculate the costs if you made the product yourself. Choose the option that gives the best margin, taking your capacity into account.
Check your prices regularly
Suppliers regularly raise their prices. Check your cost prices monthly and adjust your selling prices if necessary.
✨ Pro tip
Track your top 3 ready-made products over the next 30 days - if these show healthy 35%+ margins, you're covering most of your profitability risk. Focus your energy on optimizing these core items first.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
Was this article helpful?
Frequently asked questions
What minimum margin do I need as a caterer?
You should target 35-40% net margin minimum for a healthy catering business. This means total costs shouldn't exceed 60-65% of your selling price.
Should I include labor time for ready-made products?
Absolutely - ready-made doesn't mean zero labor. Heating, plating, garnishing, and packaging all require staff time that affects your true cost per item.
How do I calculate overhead per product?
Use 15-20% of revenue as a starting point. If you have €100,000 in sales and €18,000 in overhead costs, that's 18% - apply this percentage to each product's selling price.
When is homemade more profitable than purchasing?
When your total homemade costs (ingredients + labor + overhead) are lower than ready-made costs, and you have kitchen capacity available. Don't forget to factor in the opportunity cost of staff time.
📚 Sources consulted
- EU Verordening 852/2004 — Levensmiddelenhygiëne (2004) — Official source
- EU Verordening 853/2004 — Hygiënevoorschriften voor levensmiddelen van dierlijke oorsprong (2004) — Official source
- EU Verordening 1169/2011 — Voedselinformatie aan consumenten (2011) — Official source
- NVWA — Hygiënecode voor de horeca (2024) — Official source
- NVWA — Allergenen in voedsel (2024) — Official source
- Codex Alimentarius — International Food Standards (2024) — Official source
- FSA — Safer food, better business (HACCP) (2024) — Official source
- BVL — Lebensmittelhygiene (HACCP) (2024) — Official source
- Warenwetbesluit Bereiding en behandeling van levensmiddelen (2024) — Official source
- WHO — Foodborne diseases estimates (2024) — Official source
Food Standards Agency (FSA) — https://www.food.gov.uk
The HACCP standards shown in this application are for informational purposes only. KitchenNmbrs does not guarantee that displayed values are current or complete. Always consult the FSA or your local authority for the latest regulations.
Written by
Jeffrey Smit
Founder & CEO of KitchenNmbrs
Jeffrey Smit built KitchenNmbrs from 8 years of hands-on experience as kitchen manager at 1NUL8 Group in Rotterdam. His mission: give every restaurant owner control over food cost.
Selling food? Then you need KitchenNmbrs
Whether you run a restaurant, food truck, catering company, or meal kit business — you need to know what each dish costs. KitchenNmbrs gives you that insight. Start your free trial.
Start free trial →