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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