Webinar: The Food Cost Reduction Secrets Of Multi-Branch Businesses

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Food Cost Calculator

Recipe Details

Pricing Details

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Actual Food Cost

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Results

Actual Food Cost (%)

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Expected Profit

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Expected Selling Price

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Expected Food Cost

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Enter the values in the input fields to generate results which can be downloaded as PDF.

Food Cost Calculator

Discover Supy’s Food Cost Calculator, a built-in engine that caters to the needs of the food industry. Our dynamic Food Cost Calculator facilitates the task of determining the ideal food cost for any menu item. Our Food Cost Calculator accounts for every detail – from ingredient costs to quantity used – ensuring that your pricing strategy is both competitive and profitable.

Table of Content

  1. Why Knowing Your Food Cost Percentage Matters
  2. What You Can Do With Our Food Cost Calculator 
  3. How To Use Our Food Cost Calculator
  4. How To Interpret Your Food Cost Calculator Results
  5. Conlusion

     




1. Why Knowing Your Food Cost Percentage Matters

The price of every item that you sell should cover the cost of the different operations that have allowed this item to exist : the ingredients to make, the labor to prepare it, the packaging to deliver it, the operating expenses to serve it… And with food businesses operating on thin profit margins – usually between 3 to 5% – keeping each of those expenses as low as possible is key to maximizing profitability. 

 

Your Food Cost Percentage is an important metric to look at when analyzing the profitability of a menu item, or of your business in general. The food cost of any item sold usually varies between 20% to 35%, but it is a common misconception to think that you should thrive for a specific number. Everything depends on the type of establishment you are, and the kind of food you serve.

With such an insight, you can better tune the ingredients expense such as : 

  • Better understand your supply chain : monitoring your food cost means you’re regularly aware of how ingredient prices fluctuate, and what world events affect it and therefore your restaurant’s profitability. This means you can better prepare for price changes and negotiate better deals with your suppliers. 
  • Better control over your menu : Adjust prices based on the performance of your dishes, and based on the wiggle room you have with your costing strategy. 

 

Overall, knowing your food cost percentage gives you more control over the profitability of your business. 




2. What You Can Do With Our Food Cost Calculator

Our Food Cost Calculator allows you to list the ingredients of a dish, their quantity, and their price, in order to come up with the food cost of this dish. You’ll visualize the broken down of the dish for you to understand which item is costing you the most. You’ll also see your actual food cost percentage, as well as your expected profits. You’ll then be able to extract a PDF version and keep a copy with you.




3. How To Use Our Food Cost Calculator

A. Input the item details: Name of the recipe, its price and your target food cost :

Food Cost Calculator

B. Put in the pricing details of each ingredient which include: the ingredients name, the purchase price, the quantity purchased, quantity used and the units of measurement. You will then get your ingredient cost :

Food Cost Calculator

C. When all your inputs are in, click on the calculate button.

Food Cost Calculator

D. Then based on the choice between calculating selling price or food cost we will determine which fields are shown and which results are calculated.

Food Cost Calculator

E. See the breakdown of your cost by ingredients represented in the pie chart.

F. Finally, you will have the option to have your results in a pdf format.

Food Cost Calculator




4. How To Interpret Your Food Cost Calculator Results

As previously mentioned there is no right or wrong in food cost percentage targets, as every result depends on the type of restaurant you run and the type of dish you sell. For expensive items, you may add a hefty price tag with considerable profit margins. For regular items, that may not be the case. 
There is, however, a healthy range that dishes usually average within : from 20 to 35%. 

If your food cost percentage is high, meaning above 35% : 

  • Evaluate Ingredient Costs: Review the costs of individual ingredients. Are there any particularly expensive items driving up the overall cost? Consider alternative suppliers or ingredients that maintain quality while reducing costs.
  • Portion Control: Check if portion sizes are consistent. Larger portions can significantly increase food costs. Try to see if you could reduce the portion of a costly ingredient. This helps you get better control over your costs without compromising on quality.
  • Menu Analysis: Assess high-cost menu items. Are they priced appropriately? Consider adjusting prices to maintain profit margins while remaining competitive.

If your food cost percentage is low, meaning below 20% : 

 

  • Quality Check: Ensure that the quality of ingredients and dishes is not compromised. Sometimes a significantly low food cost percentage might indicate compromises in quality that could affect customer satisfaction.
  • Pricing Strategy: Consider whether your menu prices are too high relative to ingredient costs. While a low food cost percentage may seem positive, it might mean you’re not maximizing profits on each dish.
  • Supplier Relations: While low costs are good, ensure that you’re not compromising on quality or service by choosing very cheap suppliers. Sometimes a slightly higher cost for better quality can maintain customer satisfaction and loyalty.




5. Conclusion

Knowing your Food Cost is an important step is taking control over your restaurant’s profitability. Calculating it can be done at the scale of a single dish, but can also be done at the scale of your inventory (See how to calculate it in our article How To Calculate The Food Cost Percentage).

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