Food cost percentage, explained

The restaurant food cost formula

Food cost % = plate cost ÷ menu price × 100

Plate cost is what the ingredients on one plate cost you, including the sides, the sauce and the garnish. If you don't have that number yet, start with our guide on how to cost a recipe, or let the calculator work it out.

Flip the formula around and it sets prices for you:

Menu price = plate cost ÷ target food cost %

With a 30% target, a $3.00 plate becomes a $10.00 menu item. With a 25% target, the same plate becomes $12.00.

What's a good target?

Many full-service restaurants land somewhere around 28 to 35 percent across the whole menu. That's a rule of thumb, not a law. A steakhouse with expensive cuts may run higher on entrees and make it back on drinks. A pizza shop may run well under 25 percent. What matters most is knowing each dish's number, so you can see which ones carry the menu and which ones ride along.

Food cost is only part of the picture: labor, rent and everything else come out of the same menu dollar. A dish with a low food cost but lots of hands-on prep may still be a weak earner.

Worked example: the patty melt at Saucy's Bistro

Saucy's Bistro is the sample restaurant we use for examples. Ana, who runs the kitchen, wants to know whether the $12.00 patty melt is pulling its weight. Here's the plate, with example prices.

The plate costs $4.27. At $12.00 on the menu, the food cost is $4.27 ÷ $12.00 × 100 = 36% (rounded).

That's comfortably inside a 28 to 35 percent target. To hit exactly 30%, the price would be $4.27 ÷ 0.30 = $14.24. Ana could keep $12.00 and enjoy the cushion, or use it to absorb the next beef price bump without reprinting the menu.

Notice the house sauce and fryer oil lines. They're small, but leaving out every small line on every plate is how a 30% menu quietly turns into a 34% one.

When a dish runs high: a little menu engineering

• Check the portion first. An extra ounce of protein per plate is often the whole problem.
• Look at the biggest line. In most dishes one or two ingredients are more than half the cost. A different cut, brand or supplier there beats trimming the garnish.
• Raise the price a little. Fifty cents on a popular dish often fixes the number without anyone noticing.
• Pair it. A high-cost entree next to a low-cost side or drink can balance the order.

Food cost at home

Home cooks don't set menu prices, but the same plate cost tells you which dinners stretch the budget. Compare a few family favorites per serving, for example spaghetti and meatballs against tacos, and the cheap weeknight wins become obvious. More ideas are on our page for home cooks.

Let the calculator do it

Paste a recipe into the free recipe cost calculator and type what you paid. It shows the cost per serving and suggests menu prices at 2x cost, 3x cost and a 30% food cost. Free, no signup, and your recipe never leaves your phone.