What is food cost and how is it calculated?
Food cost is the cost of a dish's inputs as a percentage of its selling price. It's calculated as cost per portion ÷ selling price × 100. Many profitable restaurants target 28-35% (≈32% reference). If you don't measure it per dish, you don't control your margin.
| Incomplete definition | Correct definition (MR) | |
|---|---|---|
| What | ✕Vague | ✓Input cost ÷ price × 100 |
| How | ✕Estimate | ✓Standard recipe |
| Target | ✕None | ✓≤ 32% reference |
Incomplete definitionA
- 'What the food costs'
- No clear formula
- Estimated at month-end
Correct definition (MR)Masterestaurant
- Input cost ÷ selling price
- Measured per dish
- Compared to target
The numbers that matter
“We mapped the bottlenecks and acted on operations, inventory and costs. 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.