Managing multiple suppliers creates a pricing nightmare that catches most restaurant owners off guard. You'll end up with wildly inaccurate food costs if you don't calculate the real average price across all your suppliers. The solution lies in weighted averages that reflect your actual purchasing patterns.
Why one average purchase price matters
If you buy steak from supplier A for €18/kg and from supplier B for €22/kg, which price do you use in your cost price calculation? The answer depends on how much you buy from each.
? Example problem:
You calculate with €18/kg in your recipes, but buy 60% from the expensive supplier (€22/kg). Your food cost won't add up.
Result: You lose money without knowing it.
The weighted average method
The most accurate method is the weighted average. This accounts for how much you buy from each supplier.
Formula:
Weighted average = (Price A × Quantity A + Price B × Quantity B) / (Quantity A + Quantity B)
? Example calculation:
Steak purchases last month:
- Supplier A: 40 kg × €18/kg = €720
- Supplier B: 60 kg × €22/kg = €1.320
Weighted average: (€720 + €1.320) / (40 + 60) = €2.040 / 100 kg = €20.40/kg
Alternative: percentage method
If you know what percentage you buy from each supplier, you can calculate it this way:
Formula:
Average price = (Price A × % A) + (Price B × % B)
? Example percentage:
You typically buy:
- 70% from supplier A (€18/kg)
- 30% from supplier B (€22/kg)
Average: (€18 × 0.70) + (€22 × 0.30) = €12.60 + €6.60 = €19.20/kg
⚠️ Note:
Update your average price monthly. Purchasing patterns and supplier prices change.
Timing considerations most kitchen managers discover too late
Sometimes it makes more sense to use different prices:
- Seasonal products: Summer price vs. winter price for vegetables
- Quality differences: Premium steak for specials, standard for daily menu
- Regular vs. emergency supplier: Normal price vs. expensive emergency purchase
Then create separate recipes or variants for each scenario.
Practical tips for administration
- Note with each delivery: supplier, quantity, price per kg
- Calculate your new average prices every month
- Update your recipes with the new prices
- Check if your food cost still makes sense after price update
With systems like KitchenNmbrs you can record different suppliers per ingredient and automatically calculate weighted averages.
Related articles
How do you calculate the real average purchase price?
Gather purchase data per supplier
Note from last month: how many kg you bought from each supplier and at what price. For example: Supplier A: 40 kg at €18/kg, Supplier B: 60 kg at €22/kg.
Calculate total costs and quantities
Multiply quantity by price for each supplier. Add up all costs and all quantities separately. In the example: €720 + €1.320 = €2.040 total, 40 + 60 = 100 kg total.
Divide total costs by total quantity
This gives you the weighted average price per kg. €2.040 / 100 kg = €20.40/kg. Use this price in your cost price calculations for recipes.
✨ Pro tip
Recalculate weighted averages for your top 8 ingredients every 3 weeks. These core items drive 70% of your food cost variance.
Calculate this yourself?
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Frequently asked questions
Do I need to calculate new average prices every month?
What if I buy very little from one supplier?
Can't I just use the cheapest price?
How do I handle seasonal fluctuations?
What if suppliers deliver different qualities?
Should I include delivery fees in my weighted average calculation?
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
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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