Cheeses Retailing - Pricing?

[Lorie]

I'm within about 45-60 days of opening my Grade A dairy to sell Artisan Goat Cheese.  I have a great deal of interest in my products, but an having problems pricing them for wholesale - restaurants and cheese shops.  Any suggestions?  I know what this products sell for when I go buy them, but what kind of mark up to cheese shops etc. use?

[linuxboy]

This depends a lot on the type of cheese (fresh vs aged), and your regional area market. In general, though, in the US, an artisan cow milk cheddar will be made for $3-4.50/lb COGS, sold for $6-8/lb FOB wholesale, and $10-$12/lb retail out of the shop. A cheese shop or retailer most often marks up at 80-100%. The final profit is different if not FOB.

A chevre or similar fresh cheese has higher packaging costs, but no aging/affinage costs, so the straight markup is different. A chevre COGS should come to around $4/lb without packaging, wholesales at ~$8/lb, and retails for $4 per 4-5 ounce tub, meaning about $16/lb.

Many variables here and the range of possible prices reflect the variability. And the pricing model you choose may not even be based on the variables because you have to balance internal COGS, what your market will bear, and profit motive and/or goal for each product in your overall product mix (eg loss leader, cash cow, etc). Are you struggling with what pricing model to pick? Or do you just want help picking an arbitrary profit target? General markup is 30-50% for wholesale and 60-80% from wholesalers to retailers for artisan cheese. The commodity cheese industry is vastly different.

[Lorie]

Thank you.  This is very helpful.  We're starting a Grade A Dairy, making artisan goat cheese.  Again, thank you!  Any other comments are appreciated. :)

[linuxboy]

I can give more targeted help if you PM me with your location. The PNW is different from CA, which is different from the south, which is different from New England, etc. If you want to chat about more sensitive specifics, let me know. Hard to give anything but generic answers without knowing more details :)

[Sailor Con Queso]

Don't underprice your product. Cheap prices means inferior quality, and that's the way buyers (wholesale or retail) will see your cheese. Start high and see what the market brings. It's easier to lower your prices than it is to raise them.

[Brie]

Don't forget to include your overhead when pricing your cheese--and that includes indirect costs, such as aging chamber, electricity, packaging, delivery, equipment, etc. The highest cost, which should be included is your labor, including whatever amount is paid for benefits (healthcare, etc). While these costs may seem incremental to begin with, if you plan to grow you will need to expend money in all these areas, and you will need to decide how far you want to expand based on these costs.  Good luck, and keep us posted!

[sominus]

Let's not forget that quality costs... Many people who know this will be unafraid of a high(er) price if your product measures up to (and exceeds) the reference standards that are in your market.  Profit is NOT unethical.

[Missy Greene]

Hi Lori,
Here in Maine it is typical to get between $6-$7 per 5oz of fresh chevre. I am not licensed and have been selling my chevre from my farm stand at $7 for the last 4 years. I used to use only organic grain but can no longer afford it... but $7 is what the price is at the local grocery stores and coo-ops, for regional chevre.
Missy

[TroyG]

I am in Texas and sell fresh chev for $16.00 per pound and sell out! Sell 16oz jar of marinated feta for $12.00 which has about 6-8 oz of feta and other things like olives and sun-dried tomatoes. We have not started selling hard cheese yet, but I am going to be looking in the $20-$30 per pound range and see how it goes.

I raise have my own herd and our milk is the best! Well that is what my state inspector said Friday when he gave me my milk test results.  8)