Ingredients Cost

Hi, Vikram Sarin, Congrats on making your first post. I look forward to many more to come!

Butter certainly costs A LOT more than flour on a per unit (ounce or gram) basis. And, by weight, it probably accounts for a very large proportion of the weight of a recipe (maybe not the most, but it's up there).  But you can easily check this yourself by costing out the recipe you gave to the guy. Just convert all quantities to weight (not volume) measures, and then figure out the cost of each per ounce or per gram. (His unit costs should be lower than your retail cost estimates since he should be purchasing wholesale, but using retail costs - if you don't have wholesale costs - will give you an upper bound.) Lastly, multiply the two together for each ingredient and add all for total costs. 

He should also be charging you for his labor to make the cookies, so there's a labor cost component to also consider. That's probably more than the ingredient costs.

Thank you for your replies. I did not give a very specific recipe since I myself was not sure about the proportions. I just said I wanted butter biscuits. So my basic doubt is regarding the weight of the ingredients. What will be the quantity of flour and butter required to make one kg or one ounce of biscuits? If I could get an estimate of that then I can figure out the costs. I used to think that butter by weight would be less than the weight of the flour. The maker said its twice the weight of the flour. 

Maybe he meant that butter is twice the cost of the flour in the recipe. The weight of the flour in my recipe is about 690 g and the butter is the second most weighty ingredient at about 200 g. But if I were to apply the unit costs to those figures, butter would likely be the most expensive element. Again, you can test this by pulling any number of sugar cookie recipes off the internet and just running the numbers.

A cup of butter also weighs more than a cup of flour, by about twice. So he may have been trying to say that as well.

Hi Vikram now I am not a professional Baker but I have had my own companies in the past. I must ask you do you have a  written contract with this individual to producing your product... (biscuits). Your contract should and must spell out exactly what recipe to be used the fee to produce this recipe plus the cost for this individual to produce that recipe for you  any variation from  the written contract must be discussed with you and you are the only one that can okay any increases or changes in the recipe. Now I would demand  this contractor to give you his recipe I would take it home and try it out if he refuses I would find another contractor I hope this helps you

Thanks. This helps. The trouble is the suppliers around here are acting very pricey. Hopefully I will be able to find someone who has got some business sense and ethics. 

Vikram Sarin posted:

Thanks. This helps. The trouble is the suppliers around here are acting very pricey. Hopefully I will be able to find someone who has got some business sense and ethics. 

Good luck remember you're the one in charge and just make sure everything is in writing

Agree with Anne. I also think you should go through the exercise of costing their recipe (or one you know you like); perhaps they are not priced as high as you think. And if they are, then you have negotiating leverage. Best of luck.