The formula
Cost per unit = Pack price / Pack size (in one shared unit)
Saving vs highest quote = (Highest unit cost – Lowest unit cost) / Highest unit cost x 100
Monthly saving = (Highest unit cost – Lowest unit cost) x Monthly usage
Why normalising matters: a $96 case and a $31 bag cannot be compared as $96 against $31. One holds 40 lb and the other holds 10 lb, so the honest comparison is $2.40 per lb against $3.10 per lb, and the bigger pack is the cheaper product despite the bigger number on the quote. Dividing every pack price by its own pack size puts all suppliers on the same ruler. The saving formulas then translate that unit gap into operating language: a percentage for judging the quote, and a monthly dollar figure at your real usage, which is the number that justifies switching or staying.
One limit to respect: this maths only works inside one unit family. Weight never honestly converts to volume without the product’s density, so enter every pack in the same unit, converting first if one supplier quotes kilos and another pounds (1 kg = 2.205 lb).
How to use it, with an example
- Pick one product and collect the current quotes for it, checking the product spec is genuinely the same: grade, trim, fresh or frozen, brand where it matters.
- Set the shared unit at the top, the unit you will enter every pack size in.
- Enter each supplier’s name, pack size and pack price. Use the add button for a fourth quote.
- Enter how much of the product you buy in a month, then read the cost per unit for every supplier, the cheapest quote, and what the gap between highest and lowest is worth at your usage.
Worked example: Three suppliers quote chicken breast. Prime Foodservice offers a 40 lb case at $96, which is $2.40 per lb. City Wholesale offers 20 lb at $56, which is $2.80 per lb. Farm Gate Supply offers 10 lb at $31, which is $3.10 per lb. The lowest pack price and the lowest unit cost point in opposite directions: the $31 bag is the most expensive chicken. The gap between highest and lowest is 22.6%, and at 400 lb a month the unit gap of $0.70 per lb is worth $280 a month, or $3,360 a year. The calculator above is prefilled with these same quotes, so you can see the ranking before entering your own.
Quote comparisons stay useful only when prices are re-checked as they move. In Odoo for Restaurants, the Odoo Purchase module keeps supplier pricelists against each product, so the last price paid by every supplier sits on the item itself and a comparison like this one takes minutes, not an afternoon of digging through invoices.
Common mistakes
- Comparing pack prices instead of unit prices. The original sin of purchasing. A cheaper-looking bag that holds half as much is often the most expensive product on the list, as the example above shows.
- Comparing unlike products. A trimmed, portioned fillet and a whole bone-in cut are not the same product even at the same unit price, because their yields differ. Normalise the spec first, then the price, and let yield settle any remaining argument.
- Forgetting delivery minimums and fees. A supplier $0.10 per lb cheaper who charges a delivery fee or forces a $500 minimum can cost more per usable order than the local supplier who delivers free twice a week. Add fees into the pack price for a fair row.
- Letting one product decide the whole supplier. Suppliers price unevenly on purpose: cheap chicken, expensive dairy. Compare product by product across your top twenty spend lines, as restaurant inventory management tips sets out, instead of awarding everything to one quote’s winner.
- Ignoring what the cheap pack does to your shelf. A 40 lb case is only a bargain if you use 40 lb before it spoils. Oversized packs that end in the bin are the most expensive format of all, which is why pack size and waste belong in the same conversation as how to manage food waste in restaurants.
- Never re-quoting. Prices drift upward quietly. A comparison done last year protects last year’s margin. Re-run your highest-spend products quarterly, and whenever a supplier announces a price rise, as part of the routine in how to reduce restaurant food cost.
FAQs
How do I compare quotes in different units, like kilos against pounds?
Convert every pack size into one shared unit before entering anything: multiply kilos by 2.205 to get pounds, or divide pounds by 2.205 to get kilos. Ounces are pounds divided by 16. What you must never do is mix weight and volume units in the same comparison, because a litre of oil and a kilo of oil are not the same amount of product.
Should the cheapest supplier per unit always win?
No. Unit price decides the ranking, then quality, yield, delivery reliability, payment terms and minimums decide the award. A supplier 2% cheaper who shorts deliveries twice a month is expensive in every way that does not show in this calculator. Use the unit gap to negotiate first: incumbents often match a proven lower quote.
How many suppliers should I compare for one product?
Three is the practical number for most products: your incumbent and two challengers.
What saving justifies switching suppliers?
As a working rule, a sustained gap above 5% on a product you buy in volume justifies the admin of switching, and above 10% it justifies switching quickly. Under 2%, service and reliability matter more than the price line. Always judge the gap at your monthly usage, since a big percentage on a tiny spend is a small dollar figure.
How often should a restaurant re-run supplier comparisons?
Quarterly for the top spend lines and immediately when a key supplier raises prices. Food prices move with season and market, and the gap between two suppliers on the same product can flip within a single quarter.
