Bakery product manufacturers  needs  to   calculate  all  elements of cost for  bakery
product costing . Costing needs to be updated every months  to keep track of price rise in
these  elements . Bakery product  costing is a critical exercise for bakers  to arrive  at
correct price so as to be competitive as well as have fair margin or profit  on sale .

As raw material/packaging /fuel  used in   manufacturing  bakery products  are highly
sensitives to  local  and international market . Bakers needs to be alert  on product pricing



Economics  for  bakers .

Bakers have to consider of  following  elements of  cost

  • Raw material  Ingredients  cost
  • Fuel  cost
  • Packaging cost
  • Labour cost
  • Other overheads
  • Marketing cost
  • Legal cost
  • Distribution cost
  • Rentals/Lease for
  • Utilities cost
  • Insurance premiums
  • Employees perks and
  • Maintenance -building and cost
  • Defectives cost
  • Pest control cost
  • Market return  cost
  • Competitors  cost
  • Interest cost on loans
  • Depreciation cost on assets  
  • Inventory  cost
  • Taxes and duties


Here  is  contribution of  these element s on bakery product  costing . These are simple
estimates   and should not be treated as actual representation as these could vary
significantly  depending on several factors .














Careful calculations needs to be done before we arrive  at product costing keeping all
element of cost  for bakery product costing .





















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BAKERY  PRODUCT  COSTING
sno
products
raw material
cost
overheads
profit
margins
1
Bread
50%
35%
15%
2
Cookies/biscuit
50%
25%
25%
3
Cakes
35%
35%
30%
4
Muffins and cupcakes
35%
30%
35%
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