What Are Variable Costs?
Variable costs are expenses that go up or down depending on how much you sell. The busier your store is, the higher your variable costs will be.
Example:
Let’s say you run a small fried chicken shop. To prepare one serving of crispy chicken with rice, you need:
- Chicken – Rp10,000
- Rice – Rp3,000
- Chili sauce & fresh sides – Rp2,000
- Takeaway packaging – Rp2,000
That brings your total variable cost per serving to Rp17,000.
If you sell 100 portions in a day → your variable cost is Rp1,700,000.
If you only sell 20 portions the next day → your variable cost drops to Rp340,000.
The Common Struggles
“My ingredients keep going to waste. I’ve already spent a lot on stock, but not enough customers are buying.”
This is a common problem for new business owners who haven’t learned how to track or control variable costs. Sometimes you end up buying too many supplies out of fear of running out—only to see sales fall short.
Smart Solutions
- Calculate your cost of goods sold (COGS) per menu item: This helps you understand your net profit margin per portion.
- Use sales data to guide your purchasing: If you’re using a POS system like Opaper, you can analyze daily sales trends and know exactly when you’re busy or slow.
- Stock ingredients that move fast and last longer: Avoid overstocking fresh items that spoil quickly. Buy smart, not in bulk by default.
Key Takeaway:
Variable costs are flexible—which is great, but that flexibility means you need to be more disciplined in managing them. If you’re not careful, your margins can shrink—or disappear entirely.