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CHICKEN, BREAST, BNLS SKLS 4/10LB+9.4% above index
Thesis6 min read

Why restaurants get overcharged, even with a pricing agreement.

Vendors win the account with sharp pricing. Then the margin comes back, a little at a time, in places operators can’t see.

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SYSCOINVOICE
3 CHEESE MOZZ SHRD253.80
4 SAUCE PIZZA #10172.80
1 PARMESAN GRTD64.20
2 OIL OLIVE BLND124.80
2 BASIL FRESH 1LB29.60
1 GARLIC PLD 5LB18.95
Price build-upPer case
CHEESE, MOZZ WMLK SHRD 4/5LB
Cost basis$70.55
Markup12.9%9.0%
Split case fee$2.50Waived
Price$86.20$76.90
Pricing
How distributor markup actually works, and where it hides.
Cost-plus pricing sounds simple. In practice, the cost is rarely the cost, and the markup is rarely one number.
HormelDelivered pricing
PEPPERONI, SLCD 2/12.5LB
PO cost set$98.40
LeprinoDeviation
CHEESE, MOZZ WMLK SHRD 4/5LB
Off standard cost−$2.10/cs
TysonRebate
Check to NY Pizza Co.$1,284
Programs
Delivered pricing, deviations and rebates: how manufacturer deals work.
Three structures, one goal: a lower cost on the products you already buy. Here’s how each one reaches your invoice.
CME block cheese
$1.742 /lb
−0.6% 12 mo
Your priceMarket
Price +8.3%, market flat
Markets
What commodity markets can and can’t tell you about your price.
Markets explain a lot of what you pay. They don’t explain all of it, and the gap is where overcharges hide.
SYSCOINVOICE 58303751
3 CHEESE MOZZ SHRD253.80
4 SAUCE PIZZA #10172.80
1 PARMESAN GRTD64.20
2 OIL OLIVE BLND124.80
2 BASIL FRESH 1LB29.60
1 GARLIC PLD 5LB18.95
1 ONION YLW 50LB32.10
TOTAL$1,318.74
Line flaggedAbove contract
Billed$84.60
Contract$76.90
Overcharge+$23.10
Auditing
What it takes to audit every invoice line.
Good pricing only lasts if someone checks it. Here’s what a real audit looks at, and why spot checks miss most of it.

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