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Bill of Materials and Production Costing: Finding the True Cost of a Finished Product
How to build full product cost from a bill of materials: waste, labour and overheads under IAS 2, with a worked example and standard cost variances.
Industries
Ingredient cost tracked from supplier to outlet
Ingredient buying, stock, production and outlet supply connect with the accounts, so every item's cost stays visible.
What is food and beverage ERP?
Food and beverage ERP connects the buying, production and distribution of food: ingredients and packaging, recipes and batches, stock and the cost of each item sold.
In HYP ERP, procurement, inventory, production, sales and accounting are set up for businesses that make, prepare or distribute food. Ingredients and packaging are followed from purchase order to the central kitchen, then on to trade customers or the group's own outlets.
HYP ERP
Food & Beverage capabilities in HYP ERP
Food businesses buy in bulk, cook or pack in batches and supply outlets daily. When purchasing, the production log and outlet transfers sit in separate files, teams estimate consumption at month end and learn the food cost only after the margin has gone.
Ingredient and packaging purchasing
Order ingredients and packaging from approved requisitions, then book receipts and supplier returns.
HYP ERP
Stock from raw ingredient to finished item
Follow every receipt, issue and transfer from raw ingredient to finished item, with stock value.
HYP ERP
Central kitchen recipes and production orders
Set up batch recipes as bills of materials and run them through production orders and work centers.
HYP ERP
Supply to outlets and trade customers
Transfer goods to outlets, and sell to trade buyers with customer prices, delivery notes and invoices.
HYP ERP
Outlets that sell what the kitchen makes
Group cafés and restaurants run on HYPOS.
HYP ERP
Food cost and channel margin
Compare wholesale and food-service margin from purchasing, production and sales records.
HYP ERP
Your operation, end to end
How a Food & Beverage business runs on HYP ERP
Follow the work from the first step to the books. Every step uses the same data, so nothing is typed twice between departments.
Step 1 of 6
Buy
Requisitions become supplier orders.
In HYP ERP: Procurement & Inventory
HYP ERP
Step 2 of 6
Receive
Deliveries enter the right store.
In HYP ERP: Procurement & Inventory
HYP ERP
Step 3 of 6
Produce
Ingredients issued, output recorded.
In HYP ERP: Production Management
HYP ERP
Step 4 of 6
Distribute
Stock moves to outlets and depots.
In HYP ERP: Procurement & Inventory
HYP ERP
Step 5 of 6
Bill
Trade invoices; outlets bill at the till.
In HYP ERP: Sales & Distribution Management
HYP ERP
HYP ERP
HYP ERP modules for Food & Beverage
Procurement & Inventory: ingredient buying and stores
Approved buying from supplier quotation to order, with ingredient, packaging and finished stock by warehouse.
Production Management: central kitchen batches
BOMs, production orders, consumption and output.
Sales & Distribution Management: food trade sales
Prices, delivery notes, invoices and returns for distribution.
What each role sees
What each person checks every morning
Purchasing and supply manager
- Price varianceHow far purchase prices differ from agreed prices.
- Supplier lead timeHow long suppliers take to deliver after an order.
- Ingredient stock coverHow many days current ingredient stock will last.
- Supplier returnsGoods being sent back to suppliers.
Central kitchen or production manager
- Output against planWhat was produced compared with what was planned.
- Consumption against BOMIngredients used compared with the standard recipe.
- WastageFood lost or thrown away in production.
- Outlet transfersBatches sent from the central kitchen to the outlets.
F&B group finance controller
- Food cost percentageFood cost as a share of food sales.
- Channel gross marginProfit after food cost for each channel, such as dine-in or delivery.
- Stock valueWhat the stock on hand is worth at cost.
- Trade receivablesWhat business customers still owe.
Why Food & Beverage businesses choose HYP ERP
Consumption recorded at the point of use
Food cost comes from ingredients issued, not estimates.
One ingredient record from supplier to outlet
Purchasing, kitchen and outlets share item and stock records.
Wholesale and food service in one set of books
Trade and outlet sales post to the same accounts.
Pricing
How much does food and beverage ERP cost?
Pricing depends on users, companies and branches, and the modules you pick. Build your request in a few minutes with the restaurants and cafés profile, and a consultant replies within one working day to prepare your quotation. Food businesses usually start with Procurement & Inventory and Production Management.
From the blog
Guides for food and beverage businesses
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Customer results
Proven in the region
Qutoof connects date production, stock and finance with HYP ERP
14warehouses with batch and expiry traceability
6modules live since September 2024
3months to implement
HYP has brought our core departments together on one cloud platform. We have a clearer view of operations and costs, and plan to build on this with Quality and Maintenance modules, followed by HYPOS when we open direct retail shops.
- Jasmine Coffee builds its new Oman factory on HYP ERP
- Il Forno connects 26 restaurant branches on one ERP with HYP
- Lava Cake streamlines sales across two Dubai branches with HYPOS
- Morsel connects two F&B businesses across four branches with HYP ERP
- Nine Squares simplifies customized hot pot ordering with HYP ERP
Food & Beverage ERP FAQs
Does HYP ERP support food production and central kitchens?
Yes, HYP ERP supports food production with bills of materials, production orders, routings and output recording tied to ingredient stock. Each central kitchen's production design is set up during implementation.
Can one ERP run food distribution and our own outlets?
Yes. HYP ERP Sales & Distribution serves trade customers while HYPOS runs the outlets, so a food group follows wholesale and outlet sales in one system.
Is HYP ERP certified for food safety?
No. HYP ERP does not certify a food operation for food safety. The quality and traceability records your food business requires are reviewed and configured during implementation.
Is HYP ERP suitable for food companies in the UAE and Saudi Arabia?
Yes. HYP ERP has served businesses in the UAE, Saudi Arabia and the wider MENA region since 2006, is ZATCA Phase 2 certified and is ready for UAE e-invoicing. For a food and beverage quotation, start with Build Your Quote or a demo.
Run kitchen, warehouse and outlets on one F&B system
Show us how ingredients move from supplier to sale.