If we multiply the purchase price by 400%, we arrive at a sales price of 7.88 euros using the simple markup calculation . For sales psychology reasons, we could round the price up to 7.90 euros .
This method allows you belize phone data to make a more precise calculation , as all variable costs are taken into account individually. However, this also makes the contribution margin calculation a little more complex and time-consuming. Contribution margin is the difference between the sales price and the variable costs.
The formula for your pizza calculation is: Selling price = variable costs + fixed costs / (1 – contribution margin ratio) .
Let's assume the following items: Cost of goods sold = €5, personnel costs = €3, rent = €2, contribution margin ratio = 40%. Selling price = (€5 + €3 + €2) / (1 – 0.4) = €11.67 for a pizza .
target cost calculation
With this method, you calculate the pricing of your pizzas based on a given target profit. The advantage is that you have the option of defining the target profit in advance.
Your calculation formula is: selling price = target profit + variable costs / sales volume .
An example for you: target profit = 2000 €, variable costs = 8 €/pizza, sales volume = 500 pizzas, selling price = (2000 € + (8 €/pizza * 500 pizzas)) / 500 pizzas = 12 € for one pizza .
Higher margins through pizza slices
When it comes to calculating costs for pizzerias, we don't want to leave out the sale of individual pizza slices. This offers you several advantages:
Higher margins: You can charge a higher price for a slice of pizza than for a whole pizza because you spread the cost of ingredients and preparation across multiple slices. Depending on the size, toppings or method of preparation, you can set different prices for different slices of pizza.