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more on costs

Back in September I wrote a post about why Merton bread costs what it costs. A few things have changed since then so I thought I’d do a brief update.

The Merton Simple is still the main loaf I make. I’ve been gradually increasing the weight of the loaves from 680g back in September to 720g and on Saturday I’m going to try them at 740g. The size is limited by the bannetons I use and the oven. Making bigger loaves does little to the overall cost for me (flour, even organic flour, is a minor part of the cost of a loaf of bread).

So, instead of the ingredients costing me 52p per loaf, they’ll be 57p!

Energy (electricity) is about 6p per loaf, and I’ve added 20p per loaf to cover other costs (like equipment, waste, contingency, etc).

What I have a clearer picture of now is what is known as the Active Production Time. This is the time spent making the bread when I can’t do anything else. For example, APT does not include when the bread is resting or fermenting when I can do other things.

The Active Production Time is (very) approximately 1hr 22mins per batch of 12 loaves. This covers weighing ingredients, hand-mixing, folding, weighing out the loaves, pre-shaping, shaping, pre-baking, loading and unloading the oven and cleaning up. It does not include transport time. If I were to pay myself £15 per hour, then 1hr 22min per batch of 12 loaves costs Merton Bakery £1.71 for Active Production Time per loaf.

The total cost per loaf is then 57p ingredients + 6p power + 20p other costs + £1.71 APT = £2.54. I add a 30% margin and sell the Merton Simple wholesale for £3.30. Customers pay £4.00. This hasn’t changed since last September.

I am not actually paying myself £15 per hour but these numbers will give you a sense of just how fine the margins are for a baker in a microbakery. I am a long way from making this a viable business. But, given the equipment and space I currently have, I wonder what the maximum number of loaves I could bake in a week would be?

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