How to calculate food cost percentage (with the simple formula)
Food cost percentage is the share of a menu item's price that goes to the ingredients used to make it. It is the fastest way to see whether a dish is pulling its weight, and it is the number lenders, landlords, and buyers look at first.
The formula
Food cost percentage = (cost of ingredients / menu price) x 100.
What is a good food cost percentage?
Most full-service restaurants aim for 28 to 35 percent. Bars and cafes with high-margin drinks often run lower. The right target depends on your concept, your labor model, and your rent, so treat these as a starting range, not a rule.
How to actually track it
- 1Build a recipe for each dish with exact quantities, including packaging and add-ons.
- 2Price every ingredient from your real vendor invoices, not last year's guess.
- 3Divide ingredient cost by menu price for each dish.
- 4Re-check whenever a vendor price changes, because a 12 percent produce hike can quietly push a dish over target.
The hard part is not the math, it is keeping ingredient prices current. That is exactly what Smooth Ops automates: upload an invoice and every dish that uses those items re-costs itself.
Put this on autopilot
Smooth Ops costs every dish, reads your invoices, and watches your vendor prices for you. Start free with one module.
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