Essence Premium Catering Business Plan — Unit Economics and Prime Cost
The economics of a single meal, and prime cost at 72.1% of revenue — the food plus labour ratio that governs a caterer.
Unit Economics and Prime Cost
Jump to section
- Overview & contents
- i. Important Notice
- 1. Executive Summary
- 2. Why Ekurhuleni
- 3. The Market and the Segment Trap
- 4. Contribution by Segment
- 5. SWOT and Competitive Position
- 6. Winning and Keeping Contracts
- 7. Tendering Into the Public Sector
- 8. Unit Economics and Prime Cost
- 9. Working Capital
- 10. The Five-Year Build and Its Gates
- 11. Funding
- 12. People and Production
- 13. Food Safety and Compliance
- 14. Financial Projections
- 15. Break-Even
- 16. Sensitivity and Scenarios
- 17. Risk Management
- 18. Implementation Timeline
- 19. Returns
- 20. Key Performance Indicators
- 21. Key Assumptions
- 22. Conclusion
- A. Appendix A: Consolidated Financial Summary
- B. Appendix B: Capital Schedules
- C. Appendix C: Funding and Debt Schedules
- D. Appendix D: Risk Register
- E. Appendix E: Glossary
|
% of revenue |
Year 1 |
Year 2 |
Year 3 |
Year 4 |
Year 5 |
|---|---|---|---|---|---|
|
Food cost |
40.7% |
40.5% |
41.3% |
41.0% |
40.5% |
|
Consumables |
3.8% |
3.8% |
3.8% |
3.8% |
3.8% |
|
Labour |
30.2% |
29.4% |
28.8% |
28.3% |
27.8% |
|
Prime cost |
74.7% |
73.7% |
73.9% |
73.1% |
72.1% |
|
Distribution |
4.9% |
4.9% |
4.9% |
4.9% |
4.9% |
|
Energy |
3.2% |
3.2% |
3.2% |
3.2% |
3.2% |
|
Rent |
9.8% |
4.5% |
3.6% |
3.1% |
2.4% |
|
Overhead |
19.1% |
13.7% |
11.2% |
9.7% |
8.9% |
Food cost barely moves across the plan — 40.7 per cent in Year 1 and 40.5 per cent in Year 5 — because the mix shift toward low-price government meals offsets the buying gains from scale. Labour improves 2.4 points on shift utilisation. Overhead falls from 19.1 per cent of revenue to 8.9 per cent, and that halving is where substantially all of the margin improvement comes from.
8.1 What food cost discipline actually means
|
Discipline |
Practice |
Value |
|---|---|---|
|
Costed menus to the gram |
Every dish costed with a target food cost by segment |
The basis of every price quoted; without it a bid is a guess |
|
Portion control at the serving line |
Standard scoops, ladles and portion sizes, enforced |
A five-gram overserve across 900 500 meals is a material number |
|
Weekly food cost calculation |
Stock issued, revenue banked, by segment |
A month is four weeks too late at a 6.6% margin |
|
Supplier contracts on core lines |
Forward-priced staples rather than weekly spot buying |
The largest cost line at 40.5% of revenue |
|
Yield testing on protein |
Actual cooked yield against theoretical |
Protein is the volatile input and the one most easily wasted |
|
Waste recorded separately from overproduction |
Two different problems with two different fixes |
Overproduction is a forecasting failure; waste is a handling one |
|
Menu engineering by contribution |
Dish selection weighted to contribution, not popularity |
Within the nutritional and client specification |
