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Thoughts on Pricing for Smoking

post #1 of 13
Thread Starter 
I've been kicking around a way to monetize the smoking process. A guy that cuts grass on some of my rental properties charges me $1.00/minute while his machine is running.

I'm sure someone has done this with a smoker, I'm curious to see the thoughts on if I priced food on a per hour basis. Obviously, the calculations to get the per hour cost would need to be worked out but it seems like an easier way of quoting jobs vs. a per job cost.

It's a given there would be price dynamics as input costs change, but I think this could work.
post #2 of 13

Price of meat times 3= price of cooked meat per pound is one way to figure it, thus a 12 pound brisket at $3per pound is $36, $36X3=$108.

A 12 pound brisket yields 6 pounds cooked+/- so $108/6=$18 per pound at point of sale. I think the calculation will get more complex than you realize if you start trying to figure the hourly rate.

post #3 of 13

I have not heard of any Cater going by Time. Food Cost X 3 is Common in a Restaurant...JJ


Edited by Chef JimmyJ - 7/31/16 at 7:47pm
post #4 of 13

While I personally haven't catered towards any events, I know plenty of people that do, including a neighbor who runs a food truck and catering business. I help out whenever I can with both. 

 

Most of the time he quotes per person.  I would say that $30 a head is common. It depends what you want your margins to be. You should be aiming to have your complete overhead costs @ 30-35% of what you charge. However, you can always adjust that margin based on other factors-maybe it's a charity event, maybe it's a buddy, maybe this event has the potential for future events and you can take a hit in the pocketbook now if it means you get another gig with the same client. 

 

Some people do take their food cost x 3 to get their number, however, that leaves you with bad margins in my opinion.

 

Total your cost of

 

food (figure in meat shrinkage and sides) +labor+ gas to get there+ wood/charcoal + utensils + any other incurred expenses (insurance, taxes, whatever)

 

and divide that total number by the amount of people you plan to serve

 

THEN

 

multiply that number x3

 

The number you end up with is your cost per person minimum. You should strive for more, but it depends on your overall business goals (if you want to run it as a business)

 

 

 

For example:

 

Food cost = $150. Labor cost=$60. Gas=$30. Wood=$40. Utensils = $20. Insurance = $5.

 

Total cost is $305

 

You plan to serve 50 people.

 

$305/50= $6.10 (cost to serve each person)

 

$6.10 x 3 = $18.30....this is the MINIMUM you should be charging if you want a decent margin, and to be paid for your time. Caterers, do very good on margins. 

 

Quoting by the hour just leaves so many undecided factors on the table, I just wouldn't do it if that's me. 

post #5 of 13

Cost of food times 3 seems pretty standard, but a lot of caterers express this number as a charge per person.  Given my experience catering parties, the per person charge is easy for customers to wrap their minds around, since they plan parties by number of guests, not amount of food.  (If you go to http://www.elkhartcatering.com/, you can see some of what I have done with it.)  By the way, I think going into catering is a great idea.  Best of luck with it.

post #6 of 13
Going to keep this handy as i am planning on taking the leap. Used social media to find what is lacking or missing around my area. This is gonna be some work as my area is experiencing a growth spurt which is mainly southern and eastern folk. Basically they are missing their home bbq joints. We have 2, lol.
post #7 of 13

It sounds like you are off to a good start doing research on social media.  Every town needs a reliable source of barbecue for parties.  Another idea about deciding on pricing is to look at what other caterers charge.  You are in a great position by being the first barbecue caterer in your town, but look at what similar caterers charge in parts of the country that have a similar cost of living.  ​ There seems to be an unspoken "going rate" for almost every kind of service, whether it is catering, tree care, phone repair, or almost any other kind of service.

post #8 of 13
Will do Thanks for the info. I am on a local Facebook page dedicated to the local restaurants and small food trucks in our area. The Administrator of the page buys my smoked cheese so i dropped him some pulled pork belly and cole slaw with 2 types of bbq sauces. I hope he gives a positive review.

Some Q view of my pork belly today


post #9 of 13

It sounds like you have already started building up a fan base.  I am sure your Facebook friend was delighted to receive the care package.  I think catering is a great way to monetize your meat smoking skills, because the costs of overhead are so much lower than if you had a restaurant or even a food truck.  You don't have to pay for things like polishing the wood floors of a restaurant or keeping it air conditioned, or even paying a restaurant staff to keep the place open for lunch and dinner every day.

post #10 of 13
Thread Starter 
After some obvious thought, I'm not pursuing the flat rate bbq pricing.... Damn it ! As a long time service writer in an automobile repair shop, flat rate seemed logical to me... Lol

As much as I want there to be... there is just no cross over from the garage to the grill...!
post #11 of 13

That makes sense.  It is not so simple to switch from one type of business to the next.  Every industry has its own way of doing things.  If you put a chauffeur, a roofer, a swimming pool cleaner, and people from any other number of small businesses together in a room, each one will have a different way of determining the right price to charge for their services.

post #12 of 13

Hey T4 do not give up on the flat rate so soon!  The 3x yardstick is a good minimum but 4x is obviously better.  Even more important in a catering business is wastage and left-over control -- which translates to volume.  For example we booked a string of 21 summer Friday night street concerts here is Maryland at $7/sandwich (beef/turkey/pork) with $1 sides.  I KNOW I can use any left-overs at other bookings so no waste, and I can quote other events at a good rate 'cause I know I can use the meat on Friday. 

Good Luck! 

--Glenn.

post #13 of 13

Glenn, you make a good and mouth-watering point about leftover control.  It got me thinking about other things a caterer who is new to the business might do with leftovers if he doesn't have enough gigs booked to just use them at the next gig.  He could distribute them as promotional freebies.  If the food is something really perishable  and the food needs to get eaten ASAP, he could have an awesome after party for the neighbors and instantly become the most popular guy in the neighborhood.

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