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Cottage Food Business Pricing Calculator

Price homemade jams, baked goods, and cottage-licensed food to actually profit.

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Rex says

Money math without the spreadsheet headache. Plug in your numbers and I'll show you exactly where the dollars land.

Try a scenario

Click to load — tweak from there.

Inputs

Result

Price per unit

$11.67

Total real cost per unit

$7.00

Labor cost per unit

$4.00

Fixed cost allocation per unit

$0.75

Profit per unit at this price

$4.67

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How to use this

  1. 1Enter ingredient cost per unit ($).
  2. 2Enter labor minutes per unit.
  3. 3Enter labor value per hour ($).
  4. 4Enter jar/label/packaging cost per unit ($).
  5. 5Enter annual fixed cost (insurance, permits, fees) ($).
  6. 6Enter expected annual units sold.
  7. 7Enter target margin (%).
  8. 8Read your price per unit on the right — it updates as you type.
  9. 9Hit Share to keep the scenario or send it to someone.

About this calculator

Cottage food producers operating under state cottage food laws (home-based, limited to non-hazardous foods like baked goods, jams, and dry mixes) often price based on ingredient cost plus 'what feels fair,' which routinely undercounts labor, packaging, and the fixed costs of running a licensed home operation like liability insurance and labeling compliance. This calculator builds price from ingredient cost per unit, labor time valued at a real hourly rate, packaging and labeling cost, and a per-unit allocation of fixed annual costs (insurance, permits, market fees) divided across expected annual unit volume, then applies your target margin. Most cottage producers are shocked to see their real all-in cost per jar or loaf is 40-60% higher than ingredient cost alone once labor is valued honestly.

FormulaFixed cost per unit = annual fixed costs ÷ annual unit volume. Total cost = ingredient + labor + packaging + fixed allocation. Price = total cost ÷ (1 − target margin%).

Worked example

Using the values the calculator loads with:

Inputs

  • Ingredient cost per unit: 1.4 $
  • Labor minutes per unit: 12
  • Labor value per hour: 20 $
  • Jar/label/packaging cost per unit: 0.85 $
  • Annual fixed cost (insurance, permits, fees): 900 $
  • Expected annual units sold: 1200
  • Target margin: 40 %

Results

  • Price per unit: $11.67
  • Total real cost per unit: $7.00
  • Labor cost per unit: $4.00
  • Fixed cost allocation per unit: $0.75
  • Profit per unit at this price: $4.67

What each field means

Inputs

Ingredient cost per unit ($)
The ingredient cost per unit used in the calculation, measured in $. Starts at 1.4 $ so you have a working example on load.
Labor minutes per unit
The labor minutes per unit used in the calculation. Starts at 12 so you have a working example on load.
Labor value per hour ($)
The labor value per hour used in the calculation, measured in $. Starts at 20 $ so you have a working example on load.
Jar/label/packaging cost per unit ($)
The jar/label/packaging cost per unit used in the calculation, measured in $. Starts at 0.85 $ so you have a working example on load.
Annual fixed cost (insurance, permits, fees) ($)
The annual fixed cost (insurance, permits, fees) used in the calculation, measured in $. Starts at 900 $ so you have a working example on load.
Expected annual units sold
The expected annual units sold used in the calculation. Starts at 1200 so you have a working example on load.
Target margin (%)
The target margin used in the calculation, measured in %. Starts at 40 % so you have a working example on load. Accepted range: 5–80 %.

Results

Price per unit
Returned as a money amount in US dollars and shown as the headline result. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
Total real cost per unit
Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
Labor cost per unit
Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
Fixed cost allocation per unit
Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
Profit per unit at this price
Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.

FAQ

What counts as a cottage food fixed cost?

Product liability insurance (often $300-500/year for a small operation), state cottage food permit or registration fees, farmers market or venue application fees, and label design/printing setup costs. These don't change with how many jars you make, so spreading them across expected annual volume is the fair way to bake them into unit price.

Why value my own labor if I'm not paying myself a wage?

If you don't price in labor, you can't tell the difference between a product that's actually profitable and one that's only 'profitable' because you're working for free. Valuing your time, even conservatively at $15-20/hour, shows you which products are worth scaling and which ones cost more in time than they're worth at your current price.

Do cottage food laws limit how much I can sell?

Many states cap annual gross sales for cottage food operations (commonly $25,000-50,000, though this varies significantly and some states have no cap), and most restrict sales to direct-to-consumer channels like farmers markets and online direct orders rather than wholesale to retail stores. Check your specific state's cottage food law before scaling production.

Accuracy and limitations

  • Results are estimates before tax, fees, and inflation unless an input explicitly covers them.
  • Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.
  • This is educational maths, not financial advice. Check anything contractual with the lender or your accountant.

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Cost per jar for small-batch jam, jelly, or preserves accounting for cook-down loss.

Cite this calculator

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APA
RevenueLab. (2026). Cottage Food Pricing Calculator. Retrieved from https://www.revenuelab.fyi/toolbox/cottage-food-pricing
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<p>Source: <a href="https://www.revenuelab.fyi/toolbox/cottage-food-pricing" target="_blank" rel="noopener">Cottage Food Pricing Calculator — RevenueLab</a> (2026).</p>
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Source: [Cottage Food Pricing Calculator — RevenueLab](https://www.revenuelab.fyi/toolbox/cottage-food-pricing) (2026).
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