Make it yourself or buy ready-made? This choice often determines the difference between profit and loss. Many restaurant owners only look at the purchase price, but forget to factor in labor costs. In this article, you'll learn step-by-step how to calculate the total costs of both options.
The hidden costs of making from scratch
If your chef spends 2 hours making stock, it costs more than just ingredients. Those 2 hours of labor need to be factored in too. At an hourly wage of €18, that's already €36 in extra costs on top of the vegetables and meat.
⚠️ Watch out:
Many business owners only calculate ingredient costs and forget about time. That makes making from scratch seem cheaper than it really is.
Calculate your actual kitchen hourly rate
For a fair comparison, you need to know what an hour of kitchen labor costs. Add up:
- Gross hourly wage: what you pay per hour
- Employer contributions: roughly 25% on top of gross wages
- Vacation pay and 13th month: average 15% extra
💡 Example hourly rate calculation:
Chef earns €16 per hour gross
- Gross hourly wage: €16.00
- Employer contributions (25%): €4.00
- Vacation pay/13th month (15%): €2.40
Actual cost per hour: €22.40
Compare total costs
For a fair comparison, add up for making from scratch: ingredient costs + (hours × actual hourly rate). Compare this with the purchase price of the ready-made product.
💡 Example: Homemade vs ready-made tomato soup
Option 1: Make from scratch (for 10 liters)
- Ingredients: €12.50
- Labor: 1.5 hours × €22.40 = €33.60
- Total: €46.10
- Per liter: €4.61
Option 2: Buy ready-made
- 10 liters professional soup: €38.00
- Per liter: €3.80
Difference: €0.81 per liter advantage for ready-made
When making from scratch is worth it
Making from scratch can be more cost-effective if:
- You can work in large batches: making 20 liters doesn't take much more time than 5 liters
- You use leftover products: bones and vegetable scraps that would otherwise be thrown away
- You have quiet moments: staff are in the kitchen anyway and have little to do
💡 Example: Making from scratch during a quiet moment
Your chef has little to do between 2:00 PM and 4:00 PM. He's in the kitchen anyway and gets paid regardless. In this case, the extra labor costs for making stock are almost zero.
Then making from scratch is often cheaper than buying.
Factor in quality and flexibility
Beyond costs, other factors matter. Making from scratch gives you more control over taste and ingredients. Ready-made is faster and consistent. Weigh these advantages into your decision.
⚠️ Watch out:
Don't forget storage costs and shelf life. Homemade usually needs to be used within 3 days, ready-made lasts longer.
Digital help with cost calculations
With an app like KitchenNmbrs, you can automatically factor labor costs into your recipe calculations. You enter how much time a recipe takes, and the system calculates the total cost including labor. That way you immediately see whether making from scratch or buying is more cost-effective.
How do you calculate making from scratch vs buying? (step by step)
Calculate your actual kitchen hourly rate
Add 25% employer contributions and 15% vacation pay/13th month to the gross hourly wage. A chef at €16/hour actually costs €22.40 per hour.
Measure the time needed for making from scratch
Keep track of how much time you spend on prep, cooking, and finishing. Include cleanup time too. Be realistic and measure a few times.
Calculate total costs for both options
Making from scratch: ingredients + (time × hourly rate). Buying: purchase price of ready-made product. Calculate per portion or per liter to compare.
✨ Pro tip
Check your 5 most-used basic ingredients (stock, sauces, dressings). If you make the right choice between making from scratch and buying for those, you'll save the most money.
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
Do I always need to factor in labor costs when making from scratch?
Yes, unless your staff has nothing to do anyway. If your chef is idle between 2:00 PM and 4:00 PM, those hours don't cost extra money.
How do I calculate labor costs if I'm the one in the kitchen?
Calculate it based on what you'd pay for a replacement. Your time has value too, even if you don't get paid for it.
What if the quality of ready-made is much worse?
Then making from scratch might be worth it, even if it's more expensive. Poor quality costs you customers and revenue in the long run.
How often should I redo this calculation?
Check at least quarterly. Labor costs and purchase prices change regularly, so your conclusion might flip.
Should I also factor in energy costs?
For a complete comparison, yes. Making from scratch uses gas/electricity, ready-made only needs reheating. The difference is usually small but can add up.
📚 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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