Food cost: how to calculate the cost of your dishes and keep it under control
What food cost is, how to calculate the actual and the ideal one, what it is in restaurants, and how recipes and stock tracking keep it within limits.
Vitrina team5 minute read
Contents
In short
Food cost shows what share of sales goes on ingredients.
Track two numbers: actual food cost from your stock and ideal food cost from your recipes.
The gap between them is made of losses: write-offs, remakes, oversized portions.
Recipes, up-to-date purchase prices and regular stocktakes keep food cost in check.
What food cost is
Food cost is the share of food revenue that goes on the cost of ingredients. If thirty out of every hundred units of sales are spent on ingredients, your food cost is 30%. It is one of the key numbers of a kitchen: it shows whether dishes actually earn money, not just sell.
28-32%
is the food cost in many full-service and limited-service restaurants, according to US Foods
Source: US Foods
Actual food cost: the formula
Actual food cost is calculated from your stock for a period, for example a week: opening stock plus purchases minus closing stock, divided by food sales. The top of the fraction shows how much food was really used, and the bottom shows how much money you received for food.
| Item | Value |
|---|---|
| Opening stock for the week | 16,000 |
| Purchases during the week | 4,000 |
| Closing stock for the week | 17,000 |
| Food sales | 10,000 |
| Actual food cost | (16,000 + 4,000 − 17,000) ÷ 10,000 = 30% |
Ideal food cost and losses
Ideal food cost is calculated not from stock but from recipes: what the ingredients for the dishes you sold should have cost, divided by the sales of those dishes. In the US Foods example the ideal food cost is 25% and the actual one 30%. The five percentage points of difference come from losses: waste, theft and extra purchasing.
How to keep food cost within limits
- 1
A recipe for every dish
Ingredients and quantities per portion, including losses from peeling and cooking.
- 2
Up-to-date purchase prices
Update prices from every invoice: yesterday’s cheese price won’t tell you what the dish costs today.
- 3
Standard portions
Scales, ladles and plating photos help the kitchen portion the same way every time.
- 4
Regular stocktakes
Without them there is no actual food cost, and therefore no gap to compare with the ideal.
- 5
Menu prices move with costs
Ingredients got more expensive? Review the dish price or its recipe instead of waiting for the end of the quarter.
The food cost of a single dish
For a single dish, food cost is simpler: the portion cost according to the recipe divided by the dish price. But for your menu, the margin in money matters more than the percentage: how to work with it is explained in our article on menu engineering.
What a recipe card should contain
Ingredients and quantities for one portion.
Yield, including losses from peeling and cooking.
The purchase price of every ingredient.
A plating photo, so the portion looks the same every time.
How Vitrina does it
In Vitrina, recipes calculate the cost of every dish and portion from the latest purchase price, and a supplier invoice only needs a photo: AI recognises the line items, and a person checks them and posts the delivery. Every sale writes off ingredients by recipe, the “Margins” report shows the margin of every dish, and if an ingredient has no price, the panel says that the cost is shown only partially. Stock and recipes come with the “Full” plan.
Frequently asked questions
What food cost is normal for a café?
According to US Foods, the benchmark is 28-32% for many full-service and limited-service restaurants. But a coffee shop, a pizzeria and a restaurant differ, so it matters more to compare yourself with yourself every month, and actual food cost with the ideal one.
How is food cost different from the cost of a dish?
The cost of a dish is what the ingredients of one portion cost according to the recipe. Food cost is a share: for a dish it is the cost divided by the price, and for a kitchen over a period it is the ingredients used divided by food sales.
How often should I recalculate dish costs?
Every time a purchase price or a recipe changes. If prices come in from invoices, costs update by themselves; by hand, check the main items at least once a month. More on the stock page.