Last week a supplier called offering 30% off premium chicken thighs – minimum 40kg purchase. Sounds tempting until you realize that's 12 weeks of inventory for most kitchens. Smart operators know that flashy discounts can drain cash faster than they save it.
Why calculate promotions?
A promotion only makes sense if you actually save money. Many restaurant owners see a discount percentage and think: "Great deal!" But they forget:
- Extra storage costs for more inventory
- Risk of spoilage with large quantities
- Cashflow impact (more money tied up)
- If you'll actually use the quantity
⚠️ Watch out:
A promotion that forces you to stock 3 months of inventory costs you cashflow. That money can't be used for other things.
Calculate the real savings
The real savings aren't the same as the discount percentage. You need to account for all extra costs and risks.
? Example:
Supplier offers 25% off salmon, but you have to buy 50kg:
- Normal price: €22/kg
- Promotion price: €16.50/kg
- Normal usage: 8kg per week
- 50kg = 6.25 weeks of inventory
Savings: €5.50/kg × 50kg = €275
But add the risks on top:
- Spoilage risk: 5% of 50kg = 2.5kg × €16.50 = €41.25
- Extra freezer space: Maybe you rent an extra freezer = €100/month
- Cashflow costs: €825 tied up for 6 weeks instead of €176 weekly
Net savings: €275 - €41.25 - €100 = €133.75 over 6 weeks
This kind of calculation – the kind of thing you only learn after closing your first month at a loss – separates profitable operators from those who chase every shiny discount.
Check your actual usage
Many promotions are based on quantities that don't match your usage. Always check how much you actually use.
? Example usage calculation:
You sell an average of 15 steaks per week at 200g each:
- Weekly usage: 15 × 0.2kg = 3kg
- Monthly usage: 3kg × 4.3 = 12.9kg
- Promotion: 25kg minimum purchase
- Inventory for: 25kg ÷ 3kg = 8.3 weeks
Question: will you use this before it spoils?
Compare with your normal ordering frequency
How often do you normally order? And what does that cost in time and administration? Sometimes a promotion is worth it because you order less frequently.
- Order frequency: How many times per month?
- Minimum order value: Do you always reach it?
- Delivery costs: How much do you save on that?
- Time: How much time does ordering take each time?
⚠️ Watch out:
Watch the shelf life. Fresh products with short shelf lives are riskier for large inventories than frozen products.
Calculate cashflow impact
A large inventory purchase means more money tied up. That money can't be used for other things. Calculate what this costs:
? Cashflow example:
Normal: €200/week on meat = €800/month
Promotion: €2,000 at once for 2.5 months of inventory
- Extra cashflow: €2,000 - €800 = €1,200
- Tied up for 2.5 months
- Opportunity cost: what could you have done with €1,200?
Create a decision matrix
List all pros and cons before you decide:
| Factor | Advantage | Disadvantage |
|---|---|---|
| Price per kg | €5.50 discount | - |
| Spoilage risk | - | €41 estimated loss |
| Storage | - | €100 extra costs |
| Cashflow | - | €1,200 tied up longer |
How to calculate a supplier promotion? (step by step)
Calculate your normal usage
Look at how much of this product you use per week. Add up: number of portions × weight per portion. Calculate how many weeks the promotion quantity will last.
Calculate total costs
Add to the purchase price: extra storage costs, estimated spoilage (5-10% for fresh products), and any extra freezer space. Don't forget the cashflow impact either.
Compare with normal purchasing
What would you normally spend over the same period? Add delivery costs and ordering frequency to that. The difference is your real savings.
✨ Pro tip
Check your actual usage patterns for the last 8 weeks before committing to any bulk promotion. You'll discover that "popular" dish actually sells 30% less than you remembered.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
Calculate it yourself?
Our free food cost calculator does it in seconds.
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Frequently asked questions
How long can I hold inventory without risk?
What if the promotion price is lower than my current food cost?
Should I always take seasonal promotions?
How do I factor in spoilage for fresh products?
What if I don't have enough storage space?
How do I prevent promotions from disrupting my cashflow?
Can I negotiate smaller quantities at promotional prices?
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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