How to Calculate Food Cost Percentage and Price a Menu
Food cost percentage is the cost of ingredients divided by the menu price. It is the single most watched number in a restaurant, because a few points of drift on every plate decides whether a busy service is profitable.
Plate cost versus period cost
- Plate cost: ingredient cost of one dish ÷ its menu price × 100.
- Period cost: (opening inventory + purchases − closing inventory) ÷ food sales × 100.
- Plate cost prices the menu; period cost is what appears on the profit and loss account.
- A gap between the two means waste, theft, over-portioning or unrecorded staff meals.
Pricing from a target
Rearranging the formula gives menu price = ingredient cost ÷ target food cost percentage. A dish costing 4.20 with a 30% target should sell at 14.00. Then sense-check against the market: a price the neighbourhood will not pay is not a price, and low-cost items often carry a lower percentage to subsidise premium proteins.
Costing accurately
- Cost the as-served portion, including trim, peel and cooking loss — the yield percentage.
- Include garnish, oil, seasoning and the sauce that is easy to forget.
- Reprice recipes when supplier costs move; contracted proteins swing fastest.
- Track by menu category so you know which section is carrying the margin.
Benchmarks
Full-service restaurants commonly run 28-35%, quick service a little lower, and fine dining can exceed 35% where labour and ambience justify the price. Pair the percentage with contribution in currency: a 40% food cost dish that returns 18 per plate can beat a 25% dish returning 6.
Key takeaways — Food Cost Percentage Calculator
- Food cost % = ingredient cost ÷ menu price × 100.
- Menu price = cost ÷ target percentage, then sanity-check against the market.
- Watch cash contribution per dish alongside the percentage.