Setting a minimum order that doesn't cost you the account

The tray that costs money to deliver

An account orders a single tray. You pack it, load the van, drive out, drop it, drive back, and later that week you write the invoice. Do the same for a ten-tray order and almost none of that changes. The drive is the same drive. The invoice takes the same few minutes. The trip out and back costs what it costs, whether the box is heavy or nearly empty.

That is the whole reason a minimum order exists. It covers the cost of turning up, which a small order often doesn't.

When I was delivering microgreens to trade I packed every order, drove it out, and wrote the invoice afterwards myself. The work wrapped around a one-tray order was much the same as the work wrapped around a big one. Friends of mine run bakeries and food trucks, and the same wall turns up there: a standing wholesale drop can shrink month by month until the trip barely pays for itself.

What the minimum actually protects

Every delivery carries a cost that has nothing to do with how much is in the box. Call it the cost of the drop. It is the time to pack and load, the fuel and miles there and back, and the few minutes to raise and chase the invoice.

That cost is roughly flat. A big order spreads it across a lot of margin. A small order spreads it across very little, and below a certain order value the margin on the goods no longer covers the cost of getting them there. Past that point, you are paying for the privilege of supplying the account.

A minimum order is the line you draw above that point.

Working out where yours sits

You don't need a spreadsheet with twenty tabs. You need three numbers, and you already half-know them.

First: what does one drop cost you to make happen, whatever its size? Add the packing time and the run out and back, then the minutes for the invoice. Put a rough money value on your own time while you're at it, because it is the most expensive part and the one people leave out.

Second: what do you make on a typical unit, after what it cost you to produce? That is your margin per unit, not your price.

Third: divide the first by the second. That tells you how many units an order has to hold before the margin covers the cost of the drop. That many units, at your price, is your break-even order. Everything below it loses money.

Your minimum sits above break-even, not on it. Break-even is only the point where the drop stops costing you. A minimum wants to leave you something for the work, so set it comfortably clear of that floor.

I'm not going to hand you a figure. Mine wouldn't be yours. The cost of a drop in a city is not the cost of a drop across a rural round, and anyone who quotes you a universal minimum hasn't done the sum for their own van. The shape is the thing to keep: the fixed cost of the drop, divided by the margin per unit, is your floor.

The account that has been under it for a year

Here is the hard part, and it is why most people never set a minimum at all. You work the number out, and then you spot a customer who has been ordering under it for a year. They pay on time. They're friendly. You don't want to lose them, and asking them to order more feels like telling them they aren't worth the trip.

So lead with keeping them. The line is: I want to carry on delivering to you, and here is how that works from now on. Said that way, it plainly isn't a brush-off.

Then give them the ways through it, because a minimum with no route around it is a door shut in someone's face. Usually there are a few:

• Deliver less often. A weekly drop that sits under the line is often a comfortable fortnightly one. Same total, half the trips.
• Add a line. If they take one product, the second one they've been meaning to try might carry them over on its own.
• Combine the run. If they're near another account, a shared delivery day changes the maths without changing their order.

Some of those suit the customer and some suit you. A good conversation lands on the one that suits both.

Saying it so it doesn't read as a rejection

Introducing a minimum is the same job as raising a price with a customer you want to keep: give notice rather than springing it on them, state it as a decision with a start date instead of a request for permission, and let a document do the talking rather than negotiating account by account. Put the minimum on your price list, alongside the delivery days and order cut-off a buyer already scans for, so it reads as a standing term of trade and not a note aimed at one customer.

A word from the other side of the order. For about a decade I was the chef receiving these deliveries, on the buying end of the transaction. A clearly stated minimum was easy to work with. What made a supplier hard to work with was vagueness, a term that moved without warning, or the sense that they resented a small order but wouldn't come out and say so. A minimum written down, with a start date and a way to meet it, is a simple thing to plan around. A producer quietly seething over a one-tray drop is not.

The order you were dreading

Most producers put off setting a minimum because they picture the awkward version, where a customer they like hears "you're not worth it." Written down as a plain term, with a date and a couple of routes through it, it lands as what it is: a supplier who has done their sums and means to keep delivering. The customers worth keeping tend to get it. Most of them are running the same numbers on their own side of the counter.