Food cost, prime cost and margin benchmarks for restaurants
These are the reference benchmarks we use in consulting: food cost ≈ 28-35% (32% target), prime cost (inputs + payroll) below ~65%, and labor ~30-35%. Mind the rule: food cost is the ONLY direct dish cost (contribution margin = price − food cost). Prime cost and labor are P&L ratios, not costs loaded onto the dish; payroll, rent and utilities are analyzed in break-even.
| No reference | With benchmarks (MR) | |
|---|---|---|
| Food cost | ✕? | ✓28-35% (target 32%) |
| Prime cost | ✕? | ✓< 65% |
| Labor | ✕? | ✓≈ 30-35% |
No referenceA
- You don't know if your food cost is high
- You don't compare prime cost
- You decide with no yardstick
With benchmarks (MR)Masterestaurant
- Compare against 28-35%
- Watch prime cost < 65%
- Spot leaks with data
The numbers that matter
“We understood the importance of costs so the business keeps the profit it deserves. A 180-degree turn.”
And with AI?
Project your food cost, spot margin leaks and simulate pricing scenarios in minutes. Diego F. Parra is an expert in AI applied to restaurants.
Free tools to apply this now
Masterestaurant tools & method
Diego F. Parra — International consultant, expert in creating and scaling restaurants and in AI applied to restaurants, foodtech and HORECA. Methodology applied in 8.400+ restaurants across 43 countries · Expert in Artificial Intelligence applied to restaurants, hospitality and food businesses · 20+ years in restaurants, catering, large events and business growth · Author of the book «From Slave to Owner» (Amazon) · International keynote speaker for the HORECA sector.
FAQ
What is a reference food cost?
What is prime cost and its benchmark?
What are these benchmarks for?
Related content
Compare your numbers with the right yardstick
Apply the benchmarks with the Masterestaurant method.