Selling and marketing
Wholesale Donut Supplies: Cost per Case and Your Margin
How to turn a case price into a true cost per dozen, so freight and boxes do not eat your margin.
On this page
- What are you really paying for in a case
- Which costs hide behind the case price
- What to check before you commit to a supplier
- How do you keep a margin after freight and boxes
- Worked example: cost per dozen with freight, boxes, and labor
- How do you compare a wholesale case to a grocery store pack?
- When should you recheck your supply costs?
- How do you store a wholesale order without waste?
- Which mistakes cost you the most money
What to remember
- The case price is not your cost. Freight and minimums are part of it.
- Cost per dozen is the number you price from, not cost per case.
- Boxes and liners belong in the cost of every donut you sell.
- Buy the size you can store and use before it goes stale.
Buying wholesale donut supplies changes your cost per dozen, but only if the case size fits how much you bake. A case you cannot store or use in time ties up money you could spend elsewhere. This guide covers the math, the checks, and the mistakes that eat your margin.
What are you really paying for in a case
A supplier quote usually shows the case price and the pack size. It rarely shows freight, a fuel charge, or a minimum order. Those three lines decide whether the case is a deal or not. Ask for them in writing before you compare two suppliers.
To get the landed cost, add the case price, freight, and any fuel charge. Then divide by the units in the case. That gives your true cost per unit. A low case price with high freight can cost more than a higher case price with free freight.
Write down the pack size
Note how many units, pounds, or boxes are in the case. A case of 500 boxes is not the same as 500 donuts.
Add freight to the case price
Freight divided by the units in the case gives the true cost per unit. A cheap case with high freight is not cheap.
Divide by the dozens you bake
Cost per case divided by the dozens you get from it gives your cost per dozen. That is the number you price from.
Check the shelf life
If the case outlasts the shelf life of what you bake, you are paying for waste. Buy the size you can use in time.
Compare on cost per dozen
Two suppliers only compare fairly at cost per dozen. The lower case price often loses once freight is added.
Which costs hide behind the case price
Ingredients are the easy part. Boxes, liners, labels, and bags add up fast, and they are easy to leave out of your math. Storage is a cost too, because a case takes up shelf space you may not have. Before you order, run the checks in donut packaging box wholesale.
To put packaging in your cost per dozen, divide the cost of one box, liner, and label by the donuts in that box. If a box holds one dozen, that packaging cost is part of that dozen. Do this for every size you sell.
What to check before you commit to a supplier
Before you place a first order, ask about the minimum, the lead time, and whether the price holds for the year. Ask what happens if a case arrives damaged. A supplier who answers those questions in writing is easier to work with.
Get the minimum in writing. Find out if the minimum is counted in cases or in dollars. Match it to what you can sell in a few weeks, not what you hope to sell. A high minimum can tie up cash you need for other supplies.
How do you keep a margin after freight and boxes
Set your selling price from cost per dozen, then check it against what your customers already pay. If the price is too high for your market, shrink the donut or simplify the finish before you cut your own pay.
Your margin is what is left after ingredients, labor, and overhead. If freight or boxes go up, your margin shrinks unless you raise your price or cut another cost. Check your margin every time a supply cost changes.
Our guide to donut wholesale price walks through the per dozen math. Donut shop profit shows what is left after labor. For the wider picture on selling from home, start with the selling guides.
Worked example: cost per dozen with freight, boxes, and labor
This example uses a small weekly batch for one regular customer. It shows how ingredients, labor, and overhead add up to a cost per dozen. Then it shows the margin after all three.
Add ingredients and packaging
Ingredients cost $9.60. Boxes, liners, and labels cost $4.40. Total is $14.00.
Add labor
Your time at $18 an hour for one hour is $18.00.
Add overhead
Power, water, and delivery bags add $4.00.
Total batch cost
$14.00 plus $18.00 plus $4.00 equals $36.00.
Cost per dozen
$36.00 divided by 4 dozen equals $9.00 per dozen.
Set your price
You sell at $14.00 a dozen.
Margin after all three
$14.00 minus $9.00 equals $5.00 per dozen. That is about 36 percent.
If freight adds to the case price, add it to the ingredient line before you start. The same math works for any batch size. Just divide the total batch cost by the dozens you bake.
How do you compare a wholesale case to a grocery store pack?
Wholesale can be cheaper per unit, but only if you can use or store the whole case. Add freight and the minimum order to the case price first. If a case lasts past its shelf life, the grocery store size can cost you less in the end.
Compare on cost per dozen, not cost per case. A grocery store pack may have a higher unit price but no minimum and no freight. For a small weekly batch, that can be the lower true cost.
When should you recheck your supply costs?
Recheck when a supplier changes the price, when freight changes, or when you change the size you buy. A quick pass every few months keeps your selling price honest. If your cost per dozen moves, your price needs to move with it.
Keep a simple note of your cost per dozen for each supplier. When a new quote comes in, update the note. That way you see the change before it eats your margin.
How do you store a wholesale order without waste?
Storage is a cost because a case takes up shelf space you may not have. Buy the size you can store and use before it goes stale. Check the shelf life of every item before you commit to a case.
If a case outlasts the shelf life of what you bake, you are paying for waste. A smaller case with a slightly higher unit price can be cheaper than a large case you throw away. Match the case size to what you sell in a few weeks.
Which mistakes cost you the most money
A case that is too big is an easy mistake to make. So is quoting a customer a price before you have added freight. And so is treating boxes as a separate purchase instead of part of the cost of each donut.
Another mistake is forgetting to recheck your costs. A supplier price change or a freight increase can turn a profitable order into a loss. Check your cost per dozen before every new order.
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Common questions
Is it cheaper to buy donut supplies wholesale or at the grocery store?
Wholesale can be cheaper per unit, but only if you can use or store the whole case. Add freight and the minimum order to the case price first. If a case lasts past its shelf life, the grocery store size can cost you less in the end.
What is the smallest wholesale order I can place?
It depends on the supplier, so ask for the minimum in writing before you plan. Find out whether the minimum is counted in cases or in dollars. Match it to what you can sell in a few weeks, not what you hope to sell.
How do I compare two suppliers fairly?
Compare cost per dozen, not cost per case. Add freight, any fuel charge, and the packaging that comes with it. Then divide by the dozens you actually bake. A lower case price does not always mean a lower delivered cost.
Should I include boxes in my donut price?
Yes. Every donut you sell leaves in something, so the box, liner, and label belong in the cost of that donut. Add them to the batch cost before you divide by the dozen. If you leave them out, your margin is smaller than you think.
How often should I recheck my supply costs?
Recheck when a supplier changes the price, when freight changes, or when you change the size you buy. A quick pass every few months keeps your selling price honest. If your cost per dozen moves, your price needs to move with it.
General information about costs and pricing, not legal, tax, or accounting advice. Your own numbers will differ.