The Fresh Loaf

News & Information for Amateur Bakers and Artisan Bread Enthusiasts

How much will a market buy my home-made bread for?

honey_and_bread's picture
honey_and_bread

How much will a market buy my home-made bread for?

I am trying to figure out how much a market will buy sourdough for. I bake at home, have all of the necessary licenses/registrations, and am ready to start my business. In NY, home processors are only allowed to sell their goods wholesale or retail, through someone else's store. So that is my plan.

I contacted a few local markets and offered to bring them a sample of my bread; 4 are interested, so tomorrow I will bring my bread to them and see if they're interested. I just have no idea what price to offer per loaf... artisan breads go for around $10/loaf in my area, but mine is organic (will they care?) My cost per loaf is currently $0.90, but I'm baking a small quantity at home so this number will change with time.

I'm hoping someone may have a $# in mind... or ratio of what the market sells a loaf for and what I would supply the loaf for? Thank you in advance!

kendalm's picture
kendalm

On the size and type.  I am the thick of los angeles and dabbled with hocking off 250g baguettes at the local canyon store for 4.99 a loaf.  They all went and people came back asking where to get more.  So maybe that gives a benchmark for you ? 

honey_and_bread's picture
honey_and_bread

They're 1.4 lb (635 grams) round loaves

BaniJP's picture
BaniJP

Do you wanna make a living out of it or is it just a hobby/after work job?

What are the prices for breads in those particular stores? Are they targeting people who are willing to spend a little more on good stuff? Because if you have a huge bread aisle where the average loaf price is let's say 1$ and you sell yours for 5$, chances are people won't buy much of it.

I'm a chef's apprentice in Germany and I've been taught for a quick price calculation multiply your ingredient cost x4, just to break even (don't know if this applies to NY though). So in your case about 4$. More like 5-6$ if it's more elaborate (cold proof, special ingredients etc.) and especially when working in smaller quantities .

(handmade, organic, low quantities, artisanal, great USPs btw)

Ask the stores what prices they would recommend, but I wouldn't go for much under 4$.

10$ per loaf is outrageous btw, especially if it's not organic. So you can easily ask for less, another USP.

 

honey_and_bread's picture
honey_and_bread

For now it's my after work job, but my employer will let me reduce my hours to 70%, so I'm hoping to turn this into full time and make a living out of it. 

The markets I'm going to today don't have artisan bread yet, just things like wine/cheese/meats/produce. Local bakeries sell sourdough for around $8/loaf directly to the customer, but theirs is not organic, and the markets I'm going to are located in a higher-end area. My bread is cold proof, and 100% organic, and small batch, I'm hoping this will increase the value to them.

It seems like asking the stores what they can pay is the route I'll have to take. I would be happy with $8/loaf, and the store would sell them for $10/loaf, but I'm not sure if that's reasonable. They know their market customers better than me after all

BaniJP's picture
BaniJP

In that case I think ~7$ is a fair price to ask. And you would have the advantage of being a little cheaper than others, while offering equal, if not better quality.

But discuss this with the shops, as you said, they know it best.

honey_and_bread's picture
honey_and_bread

Thanks! I will see how they respond to my $7 offer. Then maybe they can re-sell for $10 to their customers. I'm not sure if it's different in Germany, but do you know if the market owner pays ahead for the bread, or pays a deposit and then the balance upon delivery? 

BaniJP's picture
BaniJP

I don't know anything about that, sorry. I assume that the markets buy from suppliers and pay once a month or every bill individually. Depends on the market, products and frequency of delivery.

You will get your money in any case. I assume you will be paid once a month or every two weeks. If you deliver every couple of days, it doesn't make sense to go through the paying process all the time.
I'm sure you can come to an agreement.

retired baker's picture
retired baker

naaah, I doubt they'll go for that, they need a 40-60% markup.

I used to wholesale croissant, my approach was I'll sell it cheap to you if you sell it cheap to the customer, I want volume and am willing to allow you to do volume sales by pricing my end low. If theres no volume its a waste of my time.

They expect terms for wholesale, 7-14 days, some will pay cash but I found that rare.

floureverywhere's picture
floureverywhere

Hi honey_and_bread!  I'm located in New Paltz and I'm doing something similar to you, although not selling to retailers (yet), but rather directly to consumers.  I don't think the markup required by stores will make it viable when baking out of a home kitchen.  I am planning on selling loaves for around $8/loaf, direct to consumers.  Would love to know where you are located, and to share experiences!  Good luck to you!