Profit per kitchen hour, or more precisely contribution per kitchen hour, is what a product brings in for every hour you work on it: batch contribution ÷ batch hours. It ranks your products by what they actually pay you, because your hours are the scarcest thing you have. The order often changes: the product that brings in the most per unit, or has the best margin, is not always the one that pays you best per hour. In the example below, a brownie that brings in $2.21 pays you more than twice as much per hour as a meal prep box that brings in $5.60.
The formula
Contribution per kitchen hour = contribution per unit × sellable units per batch ÷ hours per batch
- Contribution per unit is the price (before tax and after commission) minus variable cost: ingredients, packaging, gas or power for the batch, and waste. It is explained in contribution margin.
- Sellable units are the units you actually sell from each batch, not what the recipe promises.
- Hours per batch are all the hours your hands are busy.
Your own time does not go into variable cost. It is exactly what you are measuring.
Which hours to count
Count from when you start getting ingredients out until the kitchen is clean:
- Prep: washing, peeling, weighing, chopping.
- Cooking, baking, frying, watching the pot.
- Cooling and packing, if you need to be there.
- Labelling and boxing.
- Washing up and cleaning.
Do not count oven or simmering time when you can do something else. Shopping, deliveries and messages do not go here either: they are hours for the business as a whole and belong in the monthly total, as in test 4 of how to know if your food product is profitable.
Time two or three batches with a clock. What you think a batch takes and what it really takes are often different, especially prep and setup and cleanup, the cost nobody counts.
Worked example: four products ranked three ways
You sell four products. You know what each brings in per unit and you have timed each batch. Prices are before any sales tax.
| Product | Price | Variable cost | Contribution per unit | Margin | Units per batch | Hours per batch |
|---|---|---|---|---|---|---|
| Brownie | $3.50 | $1.29 | $2.21 | 63.1% | 30 | 1.5 |
| Hot sauce (bottle) | $9.00 | $2.35 | $6.65 | 73.9% | 24 | 4.5 |
| Sourdough loaf | $8.00 | $2.60 | $5.40 | 67.5% | 24 | 4 |
| Meal prep box | $11.00 | $5.40 | $5.60 | 50.9% | 20 | 6 |
Now contribution per hour:
- Brownies: 2.21 × 30 = $66.30 ÷ 1.5 hours = $44.20 per hour
- Hot sauce: 6.65 × 24 = $159.60 ÷ 4.5 hours = $35.47 per hour
- Sourdough: 5.40 × 24 = $129.60 ÷ 4 hours = $32.40 per hour
- Meal prep: 5.60 × 20 = $112.00 ÷ 6 hours = $18.67 per hour
| Rank | Per unit | By margin | Per kitchen hour |
|---|---|---|---|
| 1 | Hot sauce ($6.65) | Hot sauce (73.9%) | Brownies ($44.20) |
| 2 | Meal prep ($5.60) | Sourdough (67.5%) | Hot sauce ($35.47) |
| 3 | Sourdough ($5.40) | Brownies (63.1%) | Sourdough ($32.40) |
| 4 | Brownies ($2.21) | Meal prep (50.9%) | Meal prep ($18.67) |
The brownie is last per unit and jumps to first per hour. The meal prep box, second per unit, ends up last: each hour you give it pays you less than half of an hour of brownies.
Compare it with what you want to earn per hour
The number only means something next to your target. If you want to earn $20 an hour, meal prep falls short by 20.00 − 18.67 = $1.33 for every hour, and that is before fixed costs.
This is the same comparison you make when you put your time inside the cost. If you cost your own labour at $20 an hour, your time on one box is 6 × 20 ÷ 20 = $6.00, more than the $5.60 each box brings in: you lose $0.40 a box. Both calculations say the same thing from two sides.
How to raise contribution per hour
You have three levers: more money per batch, fewer hours per batch, or handing hours to someone else.
- Raise the price. At $12.50 a box, contribution is $7.10, the batch brings in $142.00 and the hour rises to 142.00 ÷ 6 = $23.67.
- Make bigger batches. Setting up and cleaning take about the same time for 20 boxes as for 40. If 40 boxes take 10 hours instead of 12, the hour comes to 224.00 ÷ 10 = $22.40. How batch size changes your cost per unit goes into this.
- Cut steps. Simpler containers or prepping vegetables in one go might save an hour per batch: 112.00 ÷ 5 = $22.40.
- Pay someone for the simpler hours. If a helper does 4 of the 6 hours and you pay them $14 an hour, that costs $56. The batch brings in 112.00 − 56.00 = $56.00, but you only put in 2 hours: 56.00 ÷ 2 = $28.00 for each of your hours.
That last calculation shows something useful: what matters is what each of your own hours earns, because those are the hours you cannot multiply.
What this number does not tell you
- It is not your net profit. Contribution per hour still has to pay for the pitch, the power and the phone. The gap between what each sale brings in and what is left at the end is in gross profit vs net profit.
- It does not tell you how much you can sell. Brownies pay best per hour, but if you can only sell 180 a month, you cannot fill your week with them.
- It does not work if something else is the limit. If the oven is full and you have free time, rank by contribution per oven hour.
Use it to plan your week
With the ranked list, build your week from the top down: first what pays best per hour, up to what you can sell; then the next one. Whatever ends up at the bottom and below your target is a candidate for a higher price, made-to-order only, or dropping. To turn the list into a plan, see production planning and which products to keep, push or drop.
Do it with the calculator
In the food cost calculator enter the recipe, units per batch, waste, price and minutes of work per batch. It shows what you earn per kitchen hour after taking out your hourly pay; set your hourly pay to 0 to see the full contribution per hour, as in this example.
Frequently asked questions
Which hours do I count: just cooking, or everything?
Every hour your hands are busy with that batch: prep, cooking, packing, labelling and cleaning up. Oven time when you can do something else does not count; shopping and deliveries are looked at separately, in the monthly total.
Is this the same as my profit per hour?
No. Contribution per kitchen hour still has to pay your fixed costs. What you really keep per hour comes from subtracting fixed costs from the month's contribution and dividing by all your hours.
What do I do with a product that earns little per hour but sells a lot?
Before dropping it, try a higher price, bigger batches or fewer steps. If it stays below what you want to earn per hour, it is using hours you could spend on something else.
What if my oven is the limit, not my time?
Then work out contribution per oven hour: batch contribution divided by the hours the batch occupies the oven. Rank your products by whatever limits your production.