Savings will vary depending on the selling price of finished product. For
example we will examine ground beef with specification of 15% fat
and actual finished product of 12% fat. We will assume finished
product selling price of $2.20/Lb. at fat value of $0.30/Lb. for a sales
volume of 5,000 Lbs./Week or 250,000 Lbs./Year:
Annual Volume x (% Deviation Below target)
x (selling price per lb. – Fat value per lb.) /
Increased profit
250,000 Lbs. / Year x (3%)
x ($ 1.90 / Lb.)
$14,250.00 PER YEAR
