Worked Numbers
How to Price Microgreens: Cost per Ounce and Profit Margin, Worked
To price microgreens, work out what one tray costs you, add your own time, divide by the ounces you actually sell from it, and then set the price at the margin you want: price = cost per sellable ounce / (1 - margin). In the illustrative example below a tray costs $3.62 in materials, your time brings it to $8.62, and 7.20 sellable ounces make that $1.20 an ounce. A 40% margin then needs $2.00 an ounce loose, or $4.57 for a packed 2 ounce clamshell.
None of these numbers are what microgreens sell for, what a tray yields or how much seed a crop takes. They belong to one made-up grower with two racks under lights, and every one is there to be replaced with your own seeding rate, your own weighed harvests and your own power bill. Nothing here is growing, food-handling or food-safety guidance.
The microgreen cost formula
cost per tray = seed + growing medium + tray wear
+ light power + water
full cost per tray = cost per tray + your minutes / 60 x your hourly pay
sellable ounces = ounces cut x (1 - share not sold)
cost per ounce = full cost per tray / sellable ounces
price at a margin = cost per ounce / (1 - margin)
Step 1: what one tray costs
The example grower sows 1 ounce of seed per tray from seed bought at $24.00 a pound, fills 12 trays from an $18.00 bag of medium, and gets 40 crops from a $4.00 tray before replacing it. Each lit shelf holds 4 trays under a 100 watt light run 16 hours a day, and a crop spends 7 days under it, so each tray’s share is 2.80 kWh at the grower’s $0.15 a kWh.
| Line | Working | Per tray |
|---|---|---|
| Seed | 1 oz of seed at $24.00 a pound | $1.50 |
| Growing medium | $18.00 bag / 12 trays | $1.50 |
| Tray wear | $4.00 tray / 40 crops | $0.10 |
| Light power | 100 W x 16 h x 7 days, shared by 4 trays, at $0.15/kWh | $0.42 |
| Water and sundries | $0.10 | |
| Cost per tray | $3.62 |
Seed and medium are the two largest lines here, level with each other, and seed alone is 41% of the tray. Your own seeding rate moves the seed line directly, which is why the pack has no seeding table: the number has to come from your own records for each crop.
Step 2: cost per sellable ounce
A tray’s cost is only half the story. The grower spends 15 minutes on each tray, seeding, watering, harvesting and packing, and pays themselves $20.00 an hour, so the time costs $5.00: more than the tray’s materials. That brings the full cost per tray to $8.62.
The harvest weighs 8 ounces, but 10% of it is trimmed, unsold or lost, leaving 7.20 ounces that earn anything. The ounces that do not sell were still grown and paid for, so the sold ounces carry their cost: $8.62 / 7.20 = $1.20 per sellable ounce. Packed into 2 ounce clamshells at $0.35 for the clamshell and label, the tray fills 3.60 clamshells at $2.74 each.
Leave out your time and the ounce looks far cheaper than it is, and a price built on that number pays for seed and soil but not for you.
Step 3: how to price microgreens at a margin
Margin is profit as a share of the price, so the price at a margin is the cost divided by (1 - margin). A 40% margin is the same as a 66.7% markup on cost; the markup vs margin chart converts any pair.
| Loose ounce | Clamshell | |
|---|---|---|
| Cost (step 2) | $1.20 | $2.74 |
| Price for a 40% margin | $2.00 | $4.57 |
| The example’s own price | $2.50 | $6.00 |
| Margin at that price | 52.0% | 54.3% |
The example’s own prices, $2.50 an ounce loose and $6.00 a clamshell, both clear the 40% target. Those prices are the example’s to overwrite, not a claim about what any buyer pays. Because your hourly pay is already inside the cost, this margin is profit on top of your wage, not instead of it.
Step 4: restaurant account vs farmers market
Selling costs differ by channel, and they are not in the cost per ounce. The example sells 64 ounces a week loose to one restaurant account, in 2 deliveries of 12 miles round trip, 30 minutes each and $0.50 of bulk packaging, with the vehicle at the grower’s own $0.60 a mile. At one weekly market it sells 60 clamshells, paying a $35.00 stall fee, spending 5 hours from setup to packdown and driving 20 miles round trip. Hours in both channels are costed at the same $20.00 an hour.
| A week | Restaurant | Market |
|---|---|---|
| Ounces | 64 | 120 |
| Sales | $160.00 | $360.00 |
| Growing cost at $1.20 an ounce | $76.80 | $144.00 |
| Selling cost (delivery or stall, packing, miles, your hours) | $35.40 | $168.00 |
| Profit on top of your pay | $47.80 | $48.00 |
| Profit per ounce | $0.75 | $0.40 |
The insight: the bigger week is not the better ounce
The market looks like the better channel: it nets $48.00 a week against $47.80, $0.20 more. But it takes 120 ounces to do that against 64. Per ounce the restaurant account earns $0.75 and the market $0.40. A clamshell sells for $3.00 an ounce against $2.50 loose, but the stall fee, the clamshells and 5 hours behind a table cost $1.40 an ounce to sell against $0.55 for the deliveries, more than eating up the higher price.
That matters the moment rack space is your limit. The example’s 2 racks of 4 lit shelves hold 32 trays, and with each tray on the rack 8 days they turn out 28 trays a week. The orders above need 184 ounces, which is 26 trays, leaving 2 spare. When the racks are full, every tray you give to the channel earning $0.40 an ounce is a tray not earning $0.75. Compare channels by profit per ounce, not by the week’s total, once the racks decide how much you can grow.
Microgreens business profit margin, for the month
| The month | Amount |
|---|---|
| Sales: 4 restaurant weeks and 4 markets | $2,080.00 |
| Profit from both channels, on top of your pay | $383.20 |
| Fixed costs | $60.00 |
| Profit after fixed costs | $323.20 |
| Set aside for tax at 25% | $80.80 |
| Kept | $242.40 |
Profit after fixed costs is 15.5% of the month’s $2,080.00 of sales, and what is kept after the tax set-aside is 11.7%. Both are on top of the grower’s pay, which is already counted at $20.00 an hour in steps 2 and 4. A microgreens business profit margin quoted without saying whether the grower’s own hours were paid first is not comparable with this one.
The racks and lights are not in that month. $850.00 of racks, lights and equipment is paid back in month 4 at $242.40 kept a month, leaving $2,058.80 over the first 12 months.
How much loss can a tray take?
Sold by the clamshell at $6.00, one tray makes $11.72 on top of the grower’s pay. It would still break even with 61.9% of the harvest unsold, or with a harvest as light as 3.39 ounces. That headroom is the case for a solid clamshell price: a bad week of yields or unsold stock eats profit before it eats your wage. Market stall fees, miles and selling hours are not in this per-tray figure; step 4 has them.
How these were calculated
Seed per tray is ounces of seed / 16 x price per pound; medium is bag price / trays per bag; tray wear is tray price / crops per tray; light power is watts x hours a day x days under light / 1,000 / trays per shelf x price per kWh. Full cost adds minutes / 60 x hourly pay. Cost per ounce is full cost / (ounces cut x (1 - share not sold)); a clamshell is ounces per clamshell x cost per ounce + packaging, using the unrounded cost per ounce, so it can differ by a cent from multiplying the rounded figure. Price at a margin is cost / (1 - margin). Channel profit is ounces x (price - cost per ounce) less deliveries or the stall fee, packaging, miles x cost per mile and hours x hourly pay. Trays needed are rounded up to whole trays. Figures are carried from step to step as the spreadsheet shows them, to the cent. Every figure was computed twice, once by the code behind the product below and once by an independent program that costs light power a whole shelf at a time and counts trays and payback months one at a time, and the two agree. All inputs are illustrative, not measured yields, seeding rates or market prices. None of this is financial, legal or tax advice.
To run this on your own trays, harvest weights and channels, the pack below has eight linked calculators, from cost per tray to the loss share at which a tray stops paying.