Roasting Cost

Cost Estimation and Quoting for Coffee Roasting and Dry Goods Processing

A quote in this category lives or dies on how you treat yield loss and packaging. Here is what actually drives cost per finished pound and how to price it.

Green material is the single largest cost line, usually 55 to 70 percent of finished cost, and yield loss quietly inflates it. If green lands at 4.20 dollars per lb and you lose 16.5 percent to roast, your effective green cost per roasted pound is 4.20 / 0.835 = 5.03 dollars, not 4.20. Estimators who quote off green cost per pound instead of per roasted pound are already 15 to 20 percent under water before touching labor. Use the Finished Goods Cost calculator to force the yield-adjusted number, and set your green cost using a rolling 90 day average because C-market swings of 40 to 60 cents per lb are common.

Labor cost per pound is small in absolute terms but volatile with batch size. At a fully burdened 28 dollars per hour and 0.005 labor hours per lb, direct labor is 14 cents per lb. Cut batch size in half and per-pound labor often doubles because changeover and cleaning are fixed per run. The Labor Per Pound and Changeover Cleaning Time calculators together expose this: a 40 minute clean spread over 300 lb adds 6 cents per lb, but over 100 lb it adds 19 cents. Quote the batch size the customer will actually order, not your most efficient run, or the job loses money on every short order.

Machine time shows up mostly as energy and depreciation. At 23,100 BTU per batch and natural gas near 1.20 dollars per therm (100,000 BTU), fuel is about 28 cents per batch, or 0.28 cents per lb on a 100 lb drop, essentially rounding error. Electric roasters and afterburners flip that: an afterburner adding 150,000 BTU per hour can triple energy cost to 3 to 5 cents per lb. Run the Energy Per Batch calculator on your actual burner and duty, then add machine depreciation of roughly 8 to 15 cents per lb for a 200,000 dollar roaster amortized over its rated pounds, which most quotes omit entirely.

Packaging is the sleeper cost and often rivals labor plus energy combined. A 12 oz stand-up pouch with valve runs 18 to 35 cents each, a tin tie bag 8 to 14 cents, plus a label at 3 to 6 cents and a case at 90 cents per 24 units. For a 12 oz retail unit that is 0.28 to 0.55 dollars of packaging spread over 0.75 lb, or 37 to 73 cents per finished pound. Packaging Line Output feeds the labor side, but the material side belongs squarely in your quote. Buyers who spec small-run custom printed bags should see the per-unit premium, often 2 to 3 times stock bags, called out separately.

Scrap and rework are the line items estimators forget until they eat margin. Roast defects, off-profile batches, stale returns, and fill giveaway all count. A 2 percent scrap rate on 5.03 dollar effective green plus conversion means roughly 12 to 15 cents per lb of lost value. Fill giveaway is its own leak: overfilling 12 oz bags to 12.4 oz average is 3.3 percent free product, another 17 cents per pound handed away. The Scrap Rework Cost calculator quantifies both; a defensible quote carries a scrap allowance of 1.5 to 3 percent rather than pretending yield is perfect.

Overhead and margin turn cost into price. Add facility, QA, admin, and freight-in as a burden of typically 12 to 20 percent on top of direct cost, then apply target margin. Stack a realistic example: 5.03 green plus 0.14 labor plus 0.10 depreciation plus 0.01 energy plus 0.50 packaging plus 0.15 scrap equals about 5.93 dollars direct per finished pound. Apply 15 percent overhead to reach 6.82, then a 30 percent gross margin, and your quote is 6.82 / 0.70 = 9.74 dollars per finished pound, or about 7.30 dollars for a 12 oz retail unit before distributor markup.

Where quotes go wrong is predictable. The top three misses are quoting green cost per pound instead of yield-adjusted, using ideal batch size instead of the customer order profile, and burying packaging in a vague overhead percentage instead of costing it per unit. A fourth is ignoring minimum order economics: below roughly 200 lb per run, fixed changeover and QA time push cost per pound up 20 to 40 percent, so a flat per-pound price on small orders bleeds cash. Build a tiered quote with a small-batch surcharge tied to your measured Changeover Cleaning Time.

Sanity-check every quote against a simple ratio: green cost should be 55 to 70 percent of your quoted direct cost. If it is above 75 percent you have underloaded labor, packaging, or scrap; if it is below 50 percent you have likely double-counted overhead or overpriced conversion and will lose the bid. Re-run the Finished Goods Cost calculator whenever green moves more than 25 cents per lb, and requote contracts on a quarterly index rather than annually, because a 50 cent green swing on a 5 dollar effective base is a full point of margin that no conversion efficiency can recover.

Published 2026-07-01.