A catering business owner realizes their lasagne costs €68.50 to make but sells for only €80, leaving just €11.50 profit after 3 hours of work. Many caterers price themselves into poverty by forgetting packaging, transport, and labor costs. Here's how to calculate prices that actually generate profit.
What does a catering dish really cost?
Catering costs differ dramatically from restaurant pricing. You're not just buying ingredients - you need packaging, transport, and extra prep time since everything must be ready in advance.
💡 Example: Lasagne for 8 people
A lasagne that you sell for €80:
- Ingredients: €18.00
- Packaging (aluminium container): €2.50
- Gas/electricity (2 hours oven): €3.00
- Labour (3 hours at €15): €45.00
Total cost price: €68.50
Profit: €80 - €68.50 = €11.50 (14% margin)
The catering cost price formula
Catering requires a more detailed formula than restaurant calculations:
Cost price = Ingredients + Packaging + Energy + Labour + Transport
- Ingredients: Every ingredient including spices, oil, butter
- Packaging: Containers, bags, labels, instruction cards
- Energy: Gas/electricity for preparation (calculate €1.50 per oven hour)
- Labour: Your time plus any staff wages
- Transport: Fuel, vehicle wear (calculate €0.30 per km)
From cost price to selling price
After determining total cost price, calculate minimum selling price using this formula:
Minimum selling price = Cost price / (1 - Desired profit margin)
💡 Example: 25% profit margin
Cost price: €40.00
Desired margin: 25%
Minimum price: €40 / (1 - 0.25) = €40 / 0.75 = €53.33
Rounded: €55.00 (27% profit margin)
Common profit margins for catering
Catering typically runs lower margins than restaurants since you've got higher labor costs and sell fewer add-ons like drinks or desserts.
- Fresh daily meals: 20-30% profit margin
- Party catering: 25-35% profit margin
- Meal prep boxes: 30-40% profit margin
- Corporate catering: 25-35% profit margin
⚠️ Watch out:
Most caterers skip their own labor time. Spending 4 hours for €20 profit means you're earning €5 per hour. That's unsustainable.
VAT and final price
Catering falls under 9% VAT (same as restaurants). Your calculated price excludes VAT, so for the final customer price:
Final price = Price excl. VAT × 1.09
💡 Example: VAT calculation
Price excl. VAT: €55.00
With 9% VAT: €55.00 × 1.09 = €59.95
This becomes your customer-facing price.
Different prices for different customers
From tracking this across dozens of restaurants, most caterers use tiered pricing based on customer type and order volume:
- Private individuals (small): Highest price (more service, smaller quantities)
- Private individuals (large): 10-15% discount from certain volume
- Companies (regular): 15-20% discount for repeat customers
- Hospitality (wholesale): 20-30% discount for resale
Ensure your lowest price remains profitable. Always start from cost price plus minimum margin.
How do you calculate the selling price? (step by step)
Calculate all costs per dish
Add up: ingredients + packaging + energy + labour time + transport. Don't forget anything, including your own time at a realistic hourly rate (minimum €15/hour).
Determine your desired profit margin
Choose a realistic profit margin: 25-35% is standard for catering. Lower margins mean you earn too little for your time and risk.
Calculate minimum selling price
Use the formula: Cost price / (1 - Profit margin). At €40 cost price and 25% margin: €40 / 0.75 = €53.33. Round to €55.00.
Add VAT for final price
Multiply by 1.09 for 9% VAT. €55.00 × 1.09 = €59.95. This is the price you communicate to customers.
✨ Pro tip
Recalculate your top 5 catering dishes every 8 weeks since ingredient costs fluctuate constantly. Most caterers adjust prices too slowly, losing profit margins without realizing it.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
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Frequently asked questions
Should I include my own labour time in the cost price?
Absolutely yes. Calculate at least €15 per hour for your own time. Skip this and you're working for free while building an unprofitable business.
How do I include transport in the price?
Calculate €0.30 per kilometre for fuel and vehicle wear. A 20 km round trip adds €6.00 to your cost price. Don't forget return journey costs.
What if my competitor charges less than my calculated price?
Check if they're including all costs - many competitors underprice and operate at losses. Focus on customers who value quality over rock-bottom pricing.
📚 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.
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