How to calculate food cost in a restaurant

Food cost is the ratio between what the ingredients cost and what the dish sells for. A restaurant's profit rests on this single number: a 5% rise can cut monthly profit in half.

The formula

For a single dish:

Food cost % = (ingredient cost ÷ selling price) × 100

If the ingredients for a lagman cost 18,000 UZS and it sells for 55,000 UZS:

18,000 ÷ 55,000 × 100 = 32.7%

A worked example: costing one dish

The formula is simple; the work sits in the numerator — the cost. Every ingredient counts at gross weight, the weight you purchased. Here is one Caesar salad portion:

• Chicken breast — net 90 g, 8% loss → gross 98 g × 48,000/kg = 4,700 UZS
• Romaine lettuce — net 70 g, 25% loss → gross 93 g × 32,000/kg = 3,000
• Parmesan — 20 g × 185,000/kg = 3,700
• Cherry tomatoes — net 40 g, 5% loss → gross 42 g × 38,000 = 1,600
• Bread (for croutons) — 30 g × 12,000/kg = 360
• Caesar dressing (prep item) — 45 g × 62,000/kg = 2,800
• Olive oil — 10 g × 90,000 = 900
• Quail eggs — 2 pcs × 1,200 = 2,400
• Salt, spices, herbs — 500

Total cost: 19,960 UZS. At a 45,000 UZS selling price:

19,960 ÷ 45,000 × 100 = 44.4%

25,040 UZS of margin remains. The percentage is high, but you can see where: chicken, parmesan and dressing are 56% of it. Start there.

What counts as healthy

• 25-30% — a good result, what most kitchens aim for
• 30-35% — workable, but needs watching
• above 35% — profit disappears; the cause is usually not price but waste

The range shifts by dish type: meat dishes naturally run higher, drinks drop to 10-15%. So calculate it per dish, not as one average.

Why the number is often wrong

The owner runs the numbers and gets 28%. At month end there is no money. Three things are usually missing:

1. Trim loss (gross vs net weight)

You buy 1 kg of meat, but after trimming 800 grams remain. If the recipe card says 200 grams, you actually bought 250. That is a 25% gap.

2. Waste and cancelled dishes

Burnt, misprepared or returned dishes consume ingredients but never reach revenue. Leave them out and food cost looks better than it is.

3. Price drift

Cooking oil changes price twice a month. A recipe card costed three months ago no longer reflects reality.

Finding the real number

The reliable method is to calculate per period rather than per dish:

Food cost % = (opening stock + purchases − closing stock) ÷ period revenue × 100

This captures everything: waste, theft and trim loss. It requires an inventory count — counting stock at the start and end of the period.

Compare the two numbers: theoretical food cost from recipe cards, and actual food cost from inventory. The gap between them is your loss. That gap is what you work on.

What to do when food cost is high

The first instinct is to raise the price. It belongs last: the guest notices price, nothing else on this list.

1. Portion control

The largest and least visible leak. Plated by eye, portions run above the card; scales, a ladle and pre-portioned prep fix that. Ten grams of extra parmesan per Caesar is 333,000 UZS a month across 180 plates.

2. Purchase prices

Years with one supplier become habit while prices climb. Take three quotes on key ingredients twice a year: 7% off five lines takes 1.5-2% off the kitchen.

3. Recipe and placement

Sometimes the cost needs no touching: bundle the item with a cheap side, or split the portion in two. Overall food cost averages the mix that sells.

4. Cutting waste

Expired product, burnt and cancelled dishes, poor storage. Logged with a reason, they show a pattern within a month: two or three items carry half the loss.

5. And only then, price

Even then, avoid a flat percentage. Lift a few items that can carry 5-7% — a guest remembers the dishes they order, not the menu.

Three common mistakes

Settling for the average

"Our food cost is 31%" tells you nothing: that average hides a side at 18% and a fish at 52%. A third of the menu can still run at a loss.

Not counting drinks

The bar often lives as a separate world: drinks are not deducted, cocktails have no recipe cards, opened bottles never reach the count. That low food cost drags the average down and hides the kitchen.

Counting at the wrong moment

The count and the sales cut-off must be the same moment. Count mid-day, or take a delivery mid-count, and the gap shows a bookkeeping error, not a real loss. Count after close, same hour every time.

Where to start

1. Write recipe cards for your 20 best sellers — they drive 80% of revenue
2. Record gross/net weights accurately (weight after trimming)
3. Count stock weekly, not monthly
4. Track the theory-vs-actual gap — it should stay within 2-3%

Doing this by hand is hard: stock has to be deducted on every sale. That is why a POS system usually handles it — when a dish is sold, its ingredients are deducted from stock via the recipe card, and the real balance is visible at any time.