Bakery glossary
Management terms, made simple.
Recipe cost sheet, margin, markup, deposit, income statement… We gathered the terms that come up in the day-to-day of anyone who makes a living from baking, and explained each one in plain words, with an example.
Glossary
Terms from A to Z
- Recipe cost sheet
- A document with all the ingredients, quantities, packaging, and prep time of a recipe. It's used to work out the treat's real cost and to standardize production so it turns out the same every time.
- Pricing
- The process of setting a treat's selling price by adding up costs (ingredients, labor, and fixed costs) plus the profit margin you want. Pricing well is what keeps you from working for free.
- Variable cost
- A cost that changes with production: ingredients, packaging, gas. The more you make, the higher it gets.
- Fixed cost
- A cost you have even if you sell nothing that month: rent, internet, subscriptions, part of the power bill. It has to be spread across the price of each treat.
- Profit margin
- What's left of the price after paying every cost, usually as a percentage. It's your real earnings — not your revenue.
- Markup
- A multiplier you apply to a treat's cost to reach the selling price, with expenses and profit already built in. Example: a $10 cost with a 3x markup becomes a $30 price.
- Labor (hourly rate)
- What your working time is worth per hour. It goes into the treat's cost like any ingredient — because your time has value, even working from home.
- Yield
- How many units or servings a recipe makes. It's used to divide the recipe's total cost and find the cost per unit.
- Deposit
- An amount the customer pays upfront to reserve the order date. It secures the commitment and keeps your cash flow from going into the red before delivery.
- Average ticket
- The average value of each order. You get it by dividing your revenue for a period by the number of orders. Raising the average ticket earns you more without needing more customers.
- Cash flow
- The movement of money in and out of your bakery over time. It shows whether you'll have money left over or come up short in each period.
- Income statement
- A summary of what came in, what went out, and the profit over a period. It's what shows, at the end of the day, whether the bakery actually turned a profit.
- Price by weight (kg)
- A way of pricing by charging per kilo, common for cakes and treats sold by weight. The final price comes from the weight times the price per kilo.
- Catalog (online storefront)
- An online page with your photos, flavors, and prices that customers open through a link to browse and place an order, without you answering everything in DMs.
Put these terms to work for you
In Bakerly, the recipe cost sheet, margin, and income statement stop being theory: the system does the math while you focus on the treats.
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