How to track ingredient prices across shops

To track ingredient prices, record the date, shop, product, pack size and the price you paid every time you buy, then convert that price to a base unit: dollars per kilo, per litre or per unit. That is the only way to compare a 25 kg sack with a 500 g bag, or a jar of honey with a catering tub. You do not need to track everything: the five or six ingredients that make up most of your cost give you most of the picture.

What to record for each purchase

Each line of your record needs six things:

• Date. Without it you cannot tell if a price is from this week or three months ago.
• Shop. "Saturday farmers market, honey stall" or "cash and carry". You need it to compare and to go back.
• Product and quality. "Jumbo rolled oats", "wildflower honey", "70% dark chocolate". If you change brand or grade, note it: it is not the same ingredient.
• Pack size. 500 g bag, 25 kg sack, 340 g jar, 3 kg tub.
• Price paid. What left your pocket, not the shelf label.
• Price per base unit. The calculation that makes everything else comparable.

If writing it down on the spot is a hassle, photograph the receipt and the shelf tag and enter the data once a week.

Convert everything to the same unit

The formula is always the same:

price per base unit = price paid ÷ pack size

• 25 kg sack of oats at $35.00: 35.00 ÷ 25 = $1.40 per kilo.
• 500 g bag at $1.50: 1.50 ÷ 0.5 = $3.00 per kilo.
• 340 g jar of honey at $4.50: 4.50 ÷ 0.34 = $13.24 per kilo.

Things sold loosely need one more step. If the market sells chillies by the bowl or herbs by the bunch, weigh one at home a couple of times and use the average. A $2.00 bunch of coriander that weighs 80 g on average is 2.00 ÷ 0.08 = $25.00 per kilo.

Choose the unit by how the recipe uses the ingredient. If the recipe calls for eggs by number, compare per egg. If it calls for grams of flour, compare per kilo.

Which ingredients to track

To find which ones matter most, multiply how much of each ingredient you use in a month by its price. Sort from highest to lowest. The top five or six are the ones to record every time; the rest (salt, cinnamon, baking powder) can be checked every month or two.

Include packaging. For many products, the jar or the box costs more than several ingredients put together.

Worked example: oats and honey for granola

You make granola in batches of 10 jars. Each batch uses 2.5 kg of oats and 400 g of honey. You make 8 batches a month, 80 jars. Until now you buy everything at the supermarket. For a month you record prices in three places:

Look at the 500 g bag of oats: it is the cheapest thing on the shelf and the most expensive oats per kilo.

What you pay per batch today (supermarket, 1 kg bags and 340 g jars):

• Oats: 2.5 × 2.40 = $6.00
• Honey: 0.4 × 13.24 = $5.29 (worked from the unrounded 13.235)
• Total: $11.29 per batch

What you would pay buying each where it is cheapest:

• Oats from the wholesaler: 2.5 × 1.40 = $3.50
• Honey from the cash and carry: 0.4 × 9.00 = $3.60
• Total: $7.10 per batch

The difference: 11.29 − 7.10 = $4.19 per batch, or $0.42 per jar. Over 8 batches that is about $33.50 a month. Before switching, count the trip and the cash: the sack is $35.00 up front and lasts about five weeks at 20 kg a month, and the cash and carry trip has to be one you make anyway for other things, or the honey saving ($1.69 a batch, about $13.55 a month) can disappear into fuel and time.

Two months later your record shows the oat sack at $38.50. That is $1.54 per kilo, 10% more (0.14 ÷ 1.40). Per batch it adds 2.5 × 0.14 = $0.35. Without the record you would have noticed the sack felt pricier; with it you know exactly how much each jar now costs.

How often to check

• Every purchase: add the line. It takes a minute.
• Every week: glance at whether any main ingredient moved.
• Every month: compare shops and decide where to buy next month.

A working rule for updating your cost: if a main ingredient changes price and stays there for two or three purchases in a row, recalculate the recipe. If it was a one-week spike, wait.

Notebook, spreadsheet or app

A notebook works if you always carry it and do the division. A spreadsheet does the maths and lets you sort by price, but you have to type the data in. An app that reads the receipt saves the typing. What matters is that the record exists and that you use it. The guide on costing in a notebook, a spreadsheet or an app compares what each one misses.

What the records are for

With two or three months of prices you get three advantages. You know in numbers how much you buy from each supplier, which is what you need to negotiate with suppliers and regular vendors. You know when a price is genuinely low, so you can decide whether buying in bulk makes sense right then. And you see increases coming before they eat your margin. The full buying method, from shopping list to supplier, is in how to buy ingredients for a small food business.

Do it with the calculator

In the food cost calculator you enter the price and pack size just as you recorded them; it works out what each ingredient costs in the batch, and when you change a price you see how much your product cost changes.