Restaurant food cost: how to calculate it and bring it down

Food cost percentage tells you how much of every sale goes on the food itself. If your food cost is 30%, then for every 100 you take in food sales, 30 went on ingredients.

Food cost % = cost of food used ÷ food sales × 100

For a week or a month, you work out the food you used from your stock counts and purchases:

Food used = opening stock + purchases − closing stock

Four rules that keep the number honest

• Use the same period for everything. Stock, purchases and sales must cover exactly the same days.
• Count food only. Leave out packaging, cleaning supplies, napkins and equipment. They are real costs, but not food cost.
• Use sales before tax. Sales tax or VAT is not your money. Including it makes food cost look lower than it is.
• Count everything on the shelf, including prep in the fridge (sauces, marinated meat, dough). A missed shelf gives you a falsely high food cost.

There are two food cost numbers, and you need both:

• Plate cost (or dish food cost) is what the ingredients for one portion should cost, worked out from the recipe. You use it to set prices.
• Period food cost is what the kitchen actually used over a week or month, from your stock counts. It shows what really happened.

To cost a plate, list every ingredient in the recipe with the amount in one portion, multiply each by what you pay per unit, and add them up. Add a small allowance for trim and cooking loss. Then divide by the menu price before tax.

Ingredient prices change, so plate costs go out of date. Re-cost your dishes whenever a main ingredient changes price, and at least every few months. Try your own numbers in the free food cost calculator.

There is no single right number. It depends on your menu, your prices, your rent and your labour. But it helps to know where others land.

The two medians come from the National Restaurant Association's 2025 Restaurant Operations Data Abstract (opens in a new tab), based on more than 900 US operators. The Association says plainly that these figures are not standards or goals for any single restaurant. Hospitality schools such as Johnson & Wales University give 28-35% as the usual range for a profitable restaurant, and many owners aim for 30% or less.

Set your own target

Work backwards from your costs. If rent, labour and everything else take 60% of sales and you want 8% left as profit, food can take at most 32%. Then watch the trend. A food cost that creeps up a point every month matters more than how you compare to someone else.

Theoretical food cost is what you should have used: every dish sold multiplied by its recipe. It assumes perfect portions, no waste and no theft.

Actual food cost is what you really used, from opening stock + purchases − closing stock.

The difference is your variance. It is the food that left the kitchen without being paid for in a plate.

In this example, 800 of food went missing in one month. Over a year that is 9,600, most of a month's food purchases. The usual causes are:

• Over-portioning: an extra scoop of rice, a heavier hand with cheese
• Waste: food that went off, was burnt, dropped or sent back, and was never written down
• Recipes that are out of date: the kitchen changed the dish but the recipe did not change
• Price changes: suppliers charge more than the recipe cost assumes
• Unrecorded food: staff meals, free items for friends, tastings
• Theft: stock that leaves by the back door
• Counting mistakes: a missed shelf, or kilos entered as grams

Recipes are never exact, so a small gap is normal. Look at the gap ingredient by ingredient, start with the expensive ones, and watch whether it grows or shrinks month to month.

1. 1Cost every recipe. Write each dish down with exact amounts, how many portions it makes, and the cost per portion. A Canadian cooking textbook (BCcampus) lists the five standards behind food cost control: purchase specifications, recipes, yields, portion sizes and portion costs. You cannot control a dish you have not costed.
2. 2Fix the portions. Use scales, measured ladles and scoops, and a photo of each finished plate on the kitchen wall. If one cook serves 150 g of chicken and another 200 g, that is a third more chicken on every plate from the second cook.
3. 3Keep a waste log. Write down everything thrown away, with how much and why: went off, burnt, dropped, sent back. In a UK study by WRAP, 45% of restaurant and catering food waste came from preparation, 21% from spoilage and 34% from customers' plates, and three quarters of it could have been eaten.
4. 4Check supplier prices and deliveries. Compare prices every few weeks, ask for a written price list, and check each delivery against the order for weight, count and quality before you sign. A short delivery you paid for in full is food cost with nothing to show for it.
5. 5Engineer your menu. Put every dish on two scales: how many you sell, and how much money each plate leaves after its food cost. Keep and promote the dishes that sell well and earn well, re-price or re-work the ones that sell well but earn little, and drop the ones that do neither.
6. 6Count your stock regularly. Count expensive ingredients (meat, chicken, cheese, oil) daily or weekly, and everything else at least monthly. Count blind, without seeing the expected number. See our stock counting guide.
7. 7Use the oldest stock first. Follow first in, first out (FIFO): put new deliveries behind the old, label everything with the date, and set a shelf life for fresh items. The UK Food Standards Agency's guidance for caterers says FIFO helps to avoid waste.
8. 8Plan your prep. Make sauces, marinades and dough in batches sized to what you will sell, based on the same day in past weeks. Over-prep is the most common source of waste that nobody sees.
9. 9Control voids, comps and staff meals. Give each staff member their own login, make voids and free items need a reason and a manager, and ring up staff meals. Check voids and comps by staff member every week.
10. 10Price from your target. Menu price = plate cost ÷ target food cost %. A dish costing 2.88 at a 28% target should sell for about 10.29 before tax. Re-price when costs rise, rather than quietly shrinking portions.

1. 1Daily: record waste before closing; count the few most expensive ingredients.
2. 2Weekly: enter every supplier invoice; compare theoretical and actual use for your top ingredients; check voids and comps.
3. 3Monthly: do a full count at month end; work out actual food cost %; compare it to last month and to your target.
4. 4When prices change: re-cost the dishes that use that ingredient and decide whether to re-price.

Tajir Point keeps the food cost numbers up to date as you sell, so you do not have to rebuild them in a spreadsheet:

• Recipes from the dish form, per size, with a waste % for trim and cooking loss
• Cost per portion, margin and food cost % next to the menu price, worked out from what you paid for each ingredient
• Every sale takes its ingredients off stock, including toppings and extras
• A kitchen stock page showing what you started with, what came in, what was used, what was thrown away, your count and what is left
• Record waste with a reason (went off, dropped, burnt, sent back), or write off a whole dish in one step
• Make prep in batches: sauces, marinated chicken or dough come off their ingredients and go into stock as prep items
• Blind counts, with the items you count every day shown first
• A day report with sales, food cost and food cost %, dish by dish, and what the kitchen should have used against what it actually used
• Low-stock and use-first alerts, and an order list grouped by supplier that you can send on WhatsApp
• Void reasons, with a manager needed for some, and a void report by reason, staff member and day

See the restaurant POS page or book a demo with your own menu. The Light plan is free for 3 months; see pricing.