Business Plan - Cost Analysis

Dear all,

I’m trying to put together my formal business plan to present to lenders and investors. I’ve got almost everything done, except for the actual cost analysis. How do I figure out the cost for exactly one pizza? Whether it’s cheese, meat lovers, hawaiian, or margherita? Is there someone you guys can direct me that would help me figure out costs of such items?

Also, how much energy does a double decker conveyor oven usually use?

Thank you all so much for your help.



An excel spreadsheet works great for this.

You have to figure out how much of whatever you use per pizza. How many ounces of dough do you use for a 14" pizza, sauce? Cheese? How much does the box cost? The pizza saver, if you use one? Do you include parm or red pepper packets with your pizza, or how about peppercinis like Papa John’s?

All those have costs. Talk to your food vendors to get a price list, then break down the prices from the bulk packaging to what you use on your pizza.

Your spreadsheet should be able to have an input area (at least mine does) so that any time you want to know exactly what a pepperoni 12 inch costs as oppossed to a 14 inch ham and pineapple, it spits out a number.

I don’t know exactly how you are putting together your biz plan, but a great idea would work it as an electronic press kit along with the paper hard copy. Put everything on a CD, and allow your potential investors/lenders put in those options to get base pricing for each pie.


Thanks for the great recommendations. I was never great at using Excel Spreadsheets, but I guess I better figure that one out real quick.

And thanks for the idea about the CD to give out to investors. I will definitely look into that.

Any other suggestions are welcome!



Other suggestions:

  1. Go get a job in a pizza store. Work your way up to manager. Learn how they work.
  2. Take a some classes at your local junior college in business, accounting, excel etc
  3. Save money because banks don’t lend on things like this.

Ann also be aware that the prices you MAY be able to get from a distributor today will most likely NOT be the same prices you’d pay if you actually open up and start purchasing from them. I haven’t run into many food reps that are keen on giving out decent pricing until they know you’re for real and what sort of turn is in it for them.

Figure off the “list” pricing they’ll provide and then be happy when your actual food costs come in several % lower after you’ve established an account with them.

If there is a Restaurant Depot in your area, go see them. If I remember correctly they’ll offer “one time passes” for folks that are just looking around a bit. Their pricing won’t be the best on every single item, but it will certainly give you the opportunity to start getting a very close idea on what you’d see for food and equipment costs.


Thank you for the advice. Definitely taking it all into consideration.

I have opened up quite a few restaurants/bars as a consultant, moreso as a FOH consultant. It’s the BOH costs that I’m a bit lost on. As far as figuring out costs for a business plan.

Unfortunately picking up a job at a pizza shop is a no-go for me at this time because I already work as the GM of a bar/ultra-lounge downtown which takes up 65 hours/week.

I guess I’ll be relying on my business partner to figure out all the BOH stuff.

I will definitely go to the Restaurant Depot where I buy all the stuff from my bar at and check out their prices. I just need to figure out how to use Excel and plug in all the numbers to figure out the cost. Is there a financial program out there that is a good plug-n-play application? As far as plugging in numbers and it will shoot out the end costs for me? Call it wishful thinking

Thanks again!

Food Cost Pro.

Will definitely look into it. Is it worth it to buy just to write a business plan? I’m only serving a few types of pizza-by-the-slice and breadsticks and soda in a can.

Are any of you guys using Food Cost Pro? Pros/Cons?

Rather than trying build up a food cost model with a bunch af variables you don’t know yet, go to a nearby town but outside your proposed area and find a couple of operations similar to what you are contemplating and hire the owner/manager as a consultant for a few hours. You just need an agregate number not a menu item cost. You should be able to narrow the range to something usable. The bankers will have more confidence in a number derived from actual operating examples than from day-dreams about waste, portions and ingredient prices.

For example, if you were in my region and planning to open an operation similar to mine in a similar market with a similar menu, I would tell you that food, supplies, paper etc (everything we use up) costs between 28-31% of sales over time. It should run 29% but for a while when cheese prices were really low we were able once to hit 28%. That number is not very similar to our menu cost because there are a number of things that we use that are not part of menu cost (condiments, paper etc) and because of waste and spoilage.