The real cost of samples, tastings and giveaways

A sample costs you what it took to make: the portion of product, the cup, the cracker, the napkin. Not what you would have charged for it. To know whether tastings and giveaways are worth it, work out what they cost per day or per month, measure how many extra sales they bring, and compare. If the extra sales leave more contribution than the samples cost, keep going. If not, change how, where or to whom you give.

A cost that is not in the recipe

What you give away does not show up in the cost of each jar you sell, which makes it one of the hidden costs of a food business. It still comes out of your sales. If you run a tasting at every market and send product to people so they get to know you, that is your marketing budget, even if you have never called it that.

There are two kinds:

• Samples and tastings: small portions handed out so people can try. Costed per portion.
• Giveaways: full products given free to influencers, a café you want to supply, regular customers. Costed at loaded cost, with packaging and postage.

How to cost one sample

1. Product in the portion. Use the cost of the product without its retail packaging, because a sample does not come in a jar with a label. Divide the cost per kg by 1,000 and multiply by the grams in the portion.
2. What goes with it: cracker, bread, cup, spoon, cocktail stick, napkin.
3. Waste: whatever you open for the tasting and cannot sell at the end. If you bin half an open jar at closing, add it.

Cost per sample = product in the portion + extras. Cost per day = cost per sample × samples given + waste.

Worked example: jam tastings at a farmers market

You sell jars of jam. The loaded cost of a jar is $3.80 and you sell it for $9.00. Figures are before any sales tax; the guide on including sales tax in your prices covers how to go from one to the other.

The cost of one sample:

• The jam alone, without jar or label, costs you $8.00 per kg, which is $0.008 per gram.
• A 10 g portion: 10 × 0.008 = $0.08
• One cracker: $0.06
• Cup and spoon: $0.04
• Total: 0.08 + 0.06 + 0.04 = $0.18 per sample

The cost of the day: you hand out 250 samples. 250 × 0.18 = $45.00. (To keep it simple, waste is already in the jam cost.)

What you sold: 50 jars. Each jar leaves 9.00 − 3.80 = $5.20 in contribution.

• Samples per sale: 250 ÷ 50 = 5
• Sample cost per jar sold: 45.00 ÷ 50 = $0.90
• Contribution per jar after samples: 5.20 − 0.90 = $4.30

Did the samples bring those sales? Not all of them. Some people would have bought anyway. To find out, skip the tasting on a similar market day and count. Say you sell 32 jars that day.

• Extra sales from the tasting: 50 − 32 = 18 jars
• Extra contribution: 18 × 5.20 = $93.60
• Minus the cost of samples: 93.60 − 45.00 = $48.60 ahead
• Cost per extra sale: 45.00 ÷ 18 = $2.50

The tasting pays: each extra sale costs $2.50 in samples and leaves $5.20.

The tasting's break-even: cost of samples ÷ contribution per unit. 45.00 ÷ 5.20 = 8.7. You need at least 9 more jars than on a day without samples for the tasting to pay for itself.

When samples do not pay

If the numbers come out against you, try these before you stop sampling:

• Smaller portions. Going from 10 g to 6 g cuts the jam per sample from $0.08 to $0.05. The cracker costs almost as much as the jam, so a smaller cracker helps too.
• Sample to people who stop, not to everyone walking past.
• Run the tasting at the busy hours, not all day.
• Sample one or two products, the ones you most want people to buy, rather than everything on the table.

Then measure again on a comparable day. One good or bad market proves little; weather and footfall change sales on their own.

At markets, the tasting is part of the cost of the day alongside the pitch fee and travel. The guide on selling at markets and fairs shows how to put all of that together to decide whether a market is worth it.

Giveaways: at loaded cost, with a cap

A jar you give away costs you $3.80, not $9.00. Send 8 jars in a month to influencers and cafés you want as customers and that is 8 × 3.80 = $30.40, plus postage.

To keep it under control, set a monthly cap for samples and giveaways and write down everything that goes out. For example, a month with four markets and 8 jars given away:

• Tastings: 4 × 45.00 = $180.00
• Giveaways: $30.40
• Month total: $210.40

If you sell 220 jars that month, samples and giveaways come to 210.40 ÷ 220 = $0.96 per jar sold. You can treat it as monthly overhead or add it to the jar's loaded cost. What matters is that it is somewhere in the numbers and not outside them.

Do it with the calculator

In the food cost calculator, multiply what samples and giveaways cost per unit sold by the units in a batch and add it to "Gas, power and other per batch", and you will see how much it adds to the cost of each unit you sell.