How do I calculate food cost percentage?
Food cost percentage = (cost of ingredients in a dish / the menu price) x 100. For a whole period, use (beginning inventory + purchases - ending inventory) / food sales. Most full-service restaurants target roughly 28-35%; the National Restaurant Association's 2025 Restaurant Operations Report found a median of 32.4% for limited-service operators (2024 data).
How do I price a menu item from its food cost?
Divide the plate's ingredient cost by your target food-cost percentage (as a decimal). A $3.50 plate at a 30% target prices at $3.50 / 0.30 = about $11.67. Then round to a sensible menu price and sanity-check against your market.
What is a good food cost percentage?
It varies by concept: roughly 28-35% for full-service, often a bit lower for pizza and higher for steak or seafood. What matters more is your prime cost (food + labor) — operators target near or below ~60%, though the National Restaurant Association's 2024 data shows it running higher recently (a ~65% median in limited-service) as wages outpace menu prices. (NRA 2025 Restaurant Operations Report.)
Why is my actual food cost higher than my recipe cost?
Waste, over-portioning, theft, spoilage, comps, and price creep all push actual cost above the theoretical recipe cost. Tracking the gap between theoretical and actual is one of the highest-value habits in a kitchen.