How to calculate restaurant food cost (formula + examples)
Food cost is the share of the selling price taken up by a dish's ingredients. It is the single most important profitability metric in the kitchen — and if you do not measure it, you lose it. A healthy target in hospitality is usually 28–35%.
The food cost formula
The basic formula is simple: Food cost (%) = (Ingredient cost ÷ Selling price) × 100.
For example, if a pizza's ingredients cost €2.4 and you sell it for €8, food cost is 2.4 ÷ 8 × 100 = 30%. The other 70% covers labor, rent, utilities and profit.
Theoretical vs. actual food cost
Theoretical food cost comes from the recipe: what it should cost at perfect portioning. Actual food cost is what it really costs after waste, uneven portions, theft and mistakes.
The gap between the two shows exactly where you lose money. Recipe-based inventory decrements stock on every sale and surfaces the variance, so you do not discover the problem only at stock-take.
How to cut food cost without cutting quality
Do not cut quality — optimize the process:
- Standardized recipes: every dish uses the same quantities every time
- Weighed portioning: removes the guesswork that inflates cost
- Automatic receiving (NIR) from e-invoices: accurate, up-to-date purchase prices
- Supplier negotiation based on real consumption, not estimates
- Menu engineering: promote high-margin dishes, rework the weak ones
A concrete example
Take a Margherita pizza: dough €0.4, sauce €0.25, mozzarella €1.2, basil + oil €0.2 = €2 ingredient cost. At a €7.6 selling price, theoretical food cost is 26%.
But if the cook adds mozzarella "by eye" and reaches €1.6, actual food cost climbs to 31%. Across 100 pizzas sold, that is real money melting away unnoticed — which is why portioning and recipes matter.
Food cost calculator
Enter your ingredient cost and selling price — instantly see food cost %, margin and the recommended price.
31,1%Over target
Gross margin / portion: 31,00 RON
Recommended price for a target of 30%: 46,67 RON
Indicative estimate. With Appy recipes, food cost is computed automatically from goods receipts, per dish, in real time.
Frequently asked questions
What is a good food cost for a restaurant?
It depends on the concept, but 28–35% is the healthy range for most restaurants. Fast-food can go lower and fine-dining higher, offsetting through price and experience.
How do I know actual food cost, not just the recipe one?
You need recipe-based inventory that deducts ingredients on every sale and compares them to physical stock. The gap reveals waste and portioning drift.
How often should I recalculate food cost?
On every supplier price change and at least monthly. Ingredient prices fluctuate, and a food cost calculated a year ago no longer reflects reality.