Experience Food / Costing

I guess since I created a semi-food blog, I guess I should talk about food, or rather the business of making food. One of the things I learned back in school was costing, which goes beyond simply figuring out how much any particular ingredient costs for any particular amount of product served. Costing also includes the total amount of money spent to prepare to any particular dish including the labor, resource costs, and distribution costs. Distribution here is defined as anything from shipping and handling, to the busboy picking up your dirty dishes, to the dishwasher cleaning the plates after you have finished your meal.

When pricing any particular product all of these factors need to be taken into account. One of my notes indicates that when looking for a job, one of the factors we needed to keep in mind was just how much of the product price was reflected in the ingredients. One of my notes indicates that a desirable food-cost level places the ingredient costs at around 30% or so of the purchase price.

If I understood my teachers correctly, if you add up the costs of the ingredients used in your meal, roughly 1/3 of the price should cover the ingredients. Where this gets turned on it's head is when you start talking about Experience food versus Practical Food.

Practical Food is like you Burger King fast food restaurants.  You pay a set amount of money for a set amount of product, and there is no production or fanfare. Nobody goes to a Burger King for a romantic dinner, and please don't link me to any Youtube videos that say otherwise.

Experience Food is like your P.F. Chang's or Chop House Grilles. You go and spend far more money for an experience while you eat. You pay extra for an atmosphere, an environment, or a show.

Thing is, I describe myself as an Experience Food Pastry Chef. I don't bake breads and cookies, or prepare breakfast pastries that are for quick eats. I make products that are supposed to be enjoyed, and savored. I make products that with just one bite your tongue should be amazed at the flavor. To this end, I try to use the best ingredients possible for any particular dish. Ergo, my own ingredient pricing is set fairly high per the pound on local products.

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These costing consideration were some of the factors that I kept in mind when I started performing market-research into how much other people were charging for quote/unquote gourmet cookies online. I know what my own ingredient pricing is like. I also know the rough size, and shape, and what it takes to package each individual product.

For example, I prefer to use parchment paper to wrap my products because it feels more professional than wax paper or plastic. However, Parchment paper costs more than wax or plastic. So deciding to use parchment paper wrapping means that my incidental cost goes up.

Another example is the shipping. I can look online and get a handle on how much any particular box is going to cost, and an idea on how much it is going to cost to ship to any particular location. I settled on the US Postal Service as the baseline rather than FedEx or UPS for several reasons. I don't have a corporate account, and thus a corporate discount. USPS will give me boxes that I know can be safely sealed for food transport ahead of time. In trying to keep my costs down, and in turn keeping the price I pass onto my consumer manageable, USPS was the best option I could calculate.

To continue with shipping, then there is the matter of actually packing the products. For example, if I wrap the cookies in parchment paper, say 5 to a wrap with a twist on top and a ribbon, now I have the problem of securing the cookies for transport. For me the solution is placing the package in a vacuum sealed pouch, which is then secured inside a simple roll of bubblewrap. This types of details continue to add to my underlying cost(s).

As I kept trying to get a handle on these incidental details I began to understand the prices that I was seeing when searching online for gourmet cookies. 

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Before I started sharing this particular webpage around the web I circulated the site within a few friends. Some, like Shen, gave feedback on the design and layout, hence the tabs at the top. Others like Foxcat had other input to make. Specifically Foxcat said I should put how many cookies were in each shipment, rather than by weight.

So here's the explanation I gave Foxcat: Cookie Size Varies: Weight does not 

I hand-scoop all of the cookies I bake. This goes back to the Experience Food bit from earlier, in which I'm trying to make a product that the consumer knows I worked on personally, not something that was spat of a machine with no thought. This means that the individual cookie size can change from cookie to cookie. I also scoop my American-style and Cinnamon-Snap cookies at different sizes. By settling on a weight amount rather than a numerical cookie amount, whoever buys cookies can rest assured that they will be getting their money's worth for that batch.

The weight amount gives me a bit of flexibility as well. Nobody is going to complain if they get more product per price by weight than what they paid for. Let's say for example I'm packing 5 cookies averaging 1oz each in a parchment wrap. Nobody's going to complain if I wrap an extra 4 cookies up to make an even presentation bundle of 20 cookies bundled in 4 groups of 5.

Pricing by weight minimum gives me more flexibility to deal with orders than by committing to a specific cookie count. Incidentally, the specific pages in question have now been updated to reflect this.