Office lunch boxes: cost per box, minimums and invoicing

To price an office lunch box, add the loaded cost of each box (food, container, cutlery, bag, your time and the oven) to the delivery cost divided by the boxes on that run. That second number decides everything: five boxes on a run and twenty on the same run have very different costs. That is why you need a minimum order, fixed delivery windows and a weekly menu that lets you buy and cook in batches.

The cost of each box

Write down each part per unit:

• Food: the main and the side at the portions you actually serve, say a chicken grain bowl with a slaw and a cookie.
• Packaging: a compartment box, lid, cutlery, napkin, bag and a label with the person's name. The guide on delivery packaging covers choosing and costing containers.
• Labour and energy: your kitchen and packing hours spread across the day's boxes.

Delivery is paid per run

A courier or your own trip costs the same whether you carry 5 boxes or 20 to the same building. Divide the cost of the run by the boxes on that run:

• A $12 run with 5 boxes: $2.40 per box
• With 10 boxes: $1.20
• With 20 boxes: $0.60

Two offices on the same street or in the same building are one run. Group clients by area and time.

Delivery windows

Offices eat lunch in a narrow window. Offer one or two fixed windows per area, for example 12:00 to 12:30, and do not promise one-off times. Each different time is another run and another delivery cost.

Worked example: lunch boxes for offices

You sell lunch boxes at $14 each, before tax.

Loaded cost per box:

Delivery: $12 per run, using your own van, a figure that includes fuel, parking and your 40 minutes.

What each box leaves you depending on how many go on the run (price − box cost − delivery per box):

For example, with 12: 14 − 8.50 − 1.00 = $4.50, and 4.50 × 12 = $54.00.

With 5 boxes the run is barely worth it: $15.50 for going out to deliver. A minimum of 12 boxes per drop leaves you $54.00 per run. If an office orders fewer, charge the $12 delivery separately so the run pays for itself.

At that minimum, five days a week: 54 × 5 = $270 a week from that office. Add a second office in the same building ordering 8 boxes and the run carries 20, leaving 4.90 × 20 = $98.00 a day.

To see how many boxes a day you need to cover your fixed costs for the month, use the break-even calculator. The guide on delivery cost shows how to arrive at your own cost per run.

Weekly menu and order cut-off

A weekly menu published in advance, say every Thursday for the following week, lets you buy for several days at the wholesaler and cook in batches. Set an order cut-off for the next day as well. Anything cancelled after the cut-off is charged, because you have already bought for it. With confirmed orders, waste goes down.

If an office commits to a fixed number of boxes a week, you can run it like a subscription paid in advance; the guide on subscriptions and pre-orders shows how to set that up.

A fixed price with a review date

A company wants to know what it will pay for months ahead. Your ingredient prices do not stand still: chicken, avocados and oil go up and down. Agree a fixed price with a written review date, every three months for example, and before that date recalculate the cost of your boxes using the prices on your latest receipts. The guide on updating costs when prices change shows how to do it without starting from scratch. If your cost went up, you walk into the review with the number in hand.

Invoicing and payment terms

Companies will usually want an invoice. Work out your margin on the price before tax and add whatever tax applies to you when you invoice. Check your local tax rules or ask an accountant.

Agree in writing:

• Who places the order and who approves it.
• Whether you invoice weekly or fortnightly, with each day itemised.
• The payment terms. Every day of credit is your money sitting in someone else's lunch.

The guide on corporate orders covers negotiating price, invoices and terms with a company. To see office lunches as part of an events business, read the catering and events guide.

Do it with the calculator

Put the menu recipe, the packaging and your time into the food cost calculator; it gives you the loaded cost of each box and the price you need for your margin.