How to Cost a Cup of Iced Coffee, and the Mistake People Make Most
Many shops price from what the neighbour charges rather than their own cost. Here is how to work it out, and the division error that throws the number far off.
The question that comes up most in owner groups is not about espresso machines or interior design. It is this: what does a cup of iced coffee actually cost to make. There is no single answer that fits everyone, because ingredient prices differ. The method, however, is the same.
The error that throws everything off
The error happens at the first step: using the price of a whole pack to cost a single serving. A kilo of beans at Rp180,000 does not make one cup cost Rp180,000. What you need is the share of that pack that actually goes in.
The formula is simple. Pack price divided by pack size gives the price per unit. Price per unit multiplied by the amount used gives what that ingredient costs for one serving.
A worked example
Take one regular iced palm sugar latte using 18 grams of beans, 150 millilitres of milk, and 30 millilitres of palm sugar syrup.
Ingredient cost per cup
- Beans, Rp180,000 per 1,000 grams, 18 grams used
- Rp3.240
- UHT milk, Rp18,000 per 1,000 ml, 150 ml used
- Rp2.700
- Palm sugar syrup, Rp45,000 per 1,000 ml, 30 ml used
- Rp1.350
- Cup, lid, and straw
- Rp1.200
- Total cost per cup
- Rp8.490
Sold at Rp25,000, the gross profit is Rp16,510 and the food cost is 29 percent. That is healthy. The food and beverage industry generally treats anything under 35 percent as reasonable.
What usually gets left out
- Packaging. Cups, lids, straws, and bags leave with every sale, so they are part of the cost.
- Milk lost while steaming. If it happens consistently, the recipe measure should match reality.
- Modifiers often given for free. An extra shot or topping still costs something even when it is not charged.
- Ingredient price rises. A cost worked out six months ago is almost certainly out of date.
Why costing it once is not enough
Bean prices rise, milk rises, cups rise. A shop that costs everything once and files it in a spreadsheet usually notices the margin thinning only months later. Sales did not change; the cost did, and it moved quietly.
The expensive part is not getting it wrong once. It is never recalculating.
In Kelola this figure is not worked out by hand. Each product has a recipe of ingredients and measures, so the cost per cup calculates itself and moves when a supplier price is updated. Ingredient stock is deducted on every sale, so what is left in the store and what appears in the report come from the same source.
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