I run a home kitchen selling through delivery apps; how do I price a dish after the app's commission?
Enter ingredients as the product cost, packaging as a fixed fee, leave shipping empty if the app handles delivery, and put the commission rate from your agreement in the percentage field. A dish with ingredients of 18 and packaging of 2.5, a 25% commission and a 15% margin needs a menu price of 34.17.
Why food pricing works differently
In a home kitchen the cost of a dish is fairly small, but the delivery app's commission comes off the whole menu price and is usually far higher than a card fee. Packaging is not a detail either: a box, a bag and cutlery on every order add up to a fixed amount that repeats. On the other hand, you do not pay the driver when the app delivers, so shipping has no place in your numbers.
Filling in the calculator
- Work out the ingredient cost of one dish: meat or chicken, rice, spices, and oil and gas if you want to be precise.
- Enter that as the product cost in the Selling-price calculator.
- Enter the packaging cost per order in fixed fees.
- Leave shipping empty if the app delivers at its own cost.
- Enter the commission rate from your agreement with the app, then the margin you want.
Ingredients 18, packaging 2.5, commission 25%, margin 15%: price 34.17. Commission at that price is 8.54, and profit is 5.12.
The same dish sold directly to your own customers with no commission and the same margin: 24.12.
If the commission were 30% instead of 25%, the price climbs to 37.27.
The gap between 24.12 and 34.17 is the price of reaching the app's customers. It explains why many kitchens list higher prices in apps than they charge for direct orders.
When commission is very high
As commission and margin together approach 100%, the price shoots up. If they reach 100% or more, the tool refuses and explains that nothing of the price is left to pay for the ingredients. That is not a fault in the calculator; it is a sign that the dish cannot make money on those terms.
The lowest price that does not lose money
Set the margin to zero with the 25% commission to see the dish's break-even price: 27.33. If the app asks you to join a promotion that takes the price below that, you pay out of your own pocket on every plate. If what you want to know is how many dishes a month cover your rent or equipment, that is a different question, answered by the Break-even calculator.
Common questions
Should I count my time in the cost?
If you want the dish to pay for your labour, add a time cost to the ingredients; otherwise the margin alone is your wage.
The app charges an extra fixed fee per order. Where does it go?
Add it to fixed fees alongside the packaging.