Products with fluctuating daily prices like fish, meat and vegetables make cost price calculation difficult. If you always calculate with today's price, your food cost won't match your actual costs. An average purchase price gives a more realistic picture of your real costs.
Why calculate an average price?
Say you buy salmon. Monday €18/kg, Wednesday €22/kg, Friday €19/kg. If you only calculate with today's price, your food cost sometimes looks low (18% on Monday) and sometimes high (24% on Friday). But your actual costs are somewhere in between.
⚠️ Watch out:
Never calculate with the lowest price of the month. Then you underestimate your costs and lose money on every dish.
Method 1: Weighted average (most accurate)
With a weighted average, you don't just add up the prices, but also how much you bought at each price. This gives you a realistic picture of your actual costs.
💡 Example weighted average:
Salmon purchases last month:
- Week 1: 15 kg at €18/kg = €270
- Week 2: 20 kg at €22/kg = €440
- Week 3: 10 kg at €19/kg = €190
- Week 4: 25 kg at €20/kg = €500
Total: 70 kg for €1,400
Average: €1,400 / 70 kg = €20/kg
Weighted average formula:
(Total amount all purchases) / (Total number of kg) = Average price per kg
Method 2: Moving average
Update your average price every time you purchase. This keeps your cost price current without extreme fluctuations.
💡 Example moving average:
Current stock: 20 kg at €19/kg = €380
New purchase: 15 kg at €23/kg = €345
New stock: 35 kg for €725
New average price: €725 / 35 kg = €20.71/kg
Method 3: Seasonal average
For products with strong seasonal variations, calculate an average over an entire season or year. This prevents you from making losses during expensive periods.
- Collect prices from at least 3 months
- Calculate weighted average over this period
- Update every 3 months or per season
- Account for holidays (price spikes)
Practical tips for daily purchasing
Keep a purchase log with date, supplier, quantity and price. Update your average price at least weekly. With large price fluctuations (more than 20%) adjust immediately.
⚠️ Watch out:
Check your average price against your actual spending. If you systematically spend more than your average, there's an error in your calculation.
Digital tracking saves time
Manually tracking fluctuating prices takes a lot of time. A system like KitchenNmbrs automatically calculates your weighted average price and adjusts your cost prices. This way you always have current figures without manual calculations.
How do you calculate an average purchase price? (step by step)
Collect your purchase data
Note for each purchase: date, supplier, quantity (kg) and price per kg. Do this for at least 4 weeks to get a reliable average.
Calculate the weighted average
Add up all amounts and divide by the total number of kg. Formula: (Total amount) / (Total kg) = Average price per kg.
Update your cost prices
Adjust all recipes with the new average purchase price. Recalculate your food cost and check if your menu price still works.
Repeat weekly
Update your average every week with new purchases. With large price fluctuations (>20%) adjust immediately to avoid surprises.
✨ Pro tip
Start with your 5 most expensive ingredients. If those have a stable average price, you've already solved 80% of your cost price problem.
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
How often should I update my average price?
At least weekly, or immediately with large price fluctuations of more than 20%. This keeps you close to your actual costs.
What if I buy from multiple suppliers?
Include all suppliers in one weighted average. The price per supplier doesn't matter, only your total costs count.
Should I also include waste in my average?
No, first calculate your average purchase price. You add waste later as a percentage of your total food cost.
What if a product is temporarily unavailable?
Use your last average price. Once you purchase again, update the average with the new prices.
Can I use different averages per season?
Yes, that's even better for seasonal products. Calculate a summer and winter average for products with large seasonal variations.
📚 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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