FOOD COST
Food Cost Percentage Explained
Food cost percentage compares the ingredient cost of a menu item with its selling price.
SHORT ANSWER
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Food cost percentage compares the ingredient cost of a menu item with its selling price.
What the estimate means
Use current edible-portion costs, including trim and yield losses, rather than invoice pack prices alone.
The percentage is a planning signal and does not include every operating expense.
Where estimates go wrong
Review recipes when supplier prices, portions, or specifications change.
Keep the source measurements and assumptions with the result so another person can review or update the estimate later.
A practical workflow
- Cost every ingredient at the recipe quantity.
- Divide the portion cost by the menu price and multiply by 100.
- Compare with the operation’s target and investigate the ingredients driving the gap.