Food Cost Per Portion & Gross Profit Calculator

Food Cost Guide

What should I know about Food Cost Percentage?

Food cost % = (ingredient cost / selling price) × 100. The restaurant industry standard: food cost % of 28-35% is typical for most restaurants. Fast food: 25-30%. Fine dining: 30-38%. Cafes and coffee shops: 20-30% (high margin drinks offset food). Gross profit per dish = selling price − food cost. GP% = (selling price − food cost) / selling price × 100. Example: salmon dish. Food cost £6.50. Selling price £19.00. Food cost % = 6.50/19.00 × 100 = 34.2%. GP = £12.50. GP% = 65.8%. Remember: food cost percentage alone doesn't tell you profitability — a dish with a high food cost % but also a high price point can still contribute more actual profit per cover than a low-cost dish sold cheaply.

What should I know about Calculating True Ingredient Cost?

Waste and yield affect true food cost significantly. A whole salmon fillet bought at £12/kg may yield only 70% usable flesh — true cost = £12/0.70 = £17.14/kg. Common yield percentages: chicken breast (boneless skinless): 95%. Whole chicken: 60-65% usable. Beef tenderloin: 75-80%. Onions: 85% (after peeling). Leafy greens: 75-80%. Always calculate food cost on the as-purchased price AND the yield loss. A recipe that appears profitable based on purchase price may be loss-making once prep waste is properly accounted for, which is why yield-adjusted costing matters more than the sticker price of ingredients.

What's the key thing to understand about Pricing Strategies?

Cost-plus pricing: calculate food cost, divide by target food cost % to get minimum selling price. £6.50 food cost / 0.30 = £21.67 minimum selling price. Competitive pricing: research competitor prices — your cost-plus price may be uncompetitively high or suspiciously low. Psychological pricing: £18.95 rather than £19.00. Value perception: premium presentation, service, and atmosphere justify higher prices independent of food cost. Menu engineering: deliberately design menus to draw attention to higher-margin dishes through placement, description, and visual emphasis, rather than relying on price alone to drive what customers order.

What should I know about Home Cooking Economics?

Home cooking is dramatically cheaper than eating out or ordering takeaway. A home-cooked chicken stir-fry for 4 people might cost £6-8 total versus £12-16 per person at a restaurant. Meal planning and batch cooking amplify savings: cooking 5 meals at once while ingredients are already prepared reduces per-meal time and often reduces waste (a bag of spinach used across 3 meals vs going off after one). Cost per gram of protein: chicken breast approximately 1p/g. Eggs approximately 1.5p/g. Lentils approximately 0.5p/g. Tinned beans and pulses are often the cheapest protein source of all, at a fraction of the cost per gram compared to meat.

What should I know about Yield Percentage and Trim Loss in Costing?

The price paid for an ingredient and its actual usable cost per portion can differ substantially once trim loss, peeling, and cooking shrinkage are accounted for, which is why professional costing always works from 'yield percentage' rather than raw purchase price alone. Yield percentage is the proportion of a purchased ingredient that ends up usable after preparation — for example, a whole fish might yield only 40-50% of its purchased weight as boneless, skinless fillet after heads, bones, and skin are removed, meaning the real cost per usable kilogram of fillet is roughly double the purchase price per kilogram of whole fish. Vegetables like onions or butternut squash similarly lose a meaningful percentage to peel and trim, while meat loses weight both to trimming fat/sinew and to moisture loss during cooking, commonly 15-25% depending on the cut and cooking method. Calculating true ingredient cost means dividing the purchase price by the yield percentage (expressed as a decimal) rather than using the purchase price directly, since using raw purchase price alone systematically understates true cost and leads to underpriced menu items or an inaccurate sense of how much a home-cooked meal actually costs once realistic losses are factored in.

What do I need to know about Menu Engineering and Contribution Margin?

Menu engineering is the practice of analysing which dishes are genuinely profitable versus merely popular, using contribution margin (selling price minus the raw food cost of that dish) rather than food cost percentage alone to decide pricing and menu placement. A dish with a low food cost percentage isn't automatically more profitable in absolute terms than one with a higher percentage — a £3 side dish costing 20% to make contributes only 60p of margin, while a £15 main costing 35% to make contributes £9.75, far more cash profit per sale despite the 'worse' percentage. Dishes are often categorised into a simple matrix based on popularity and contribution margin: high-margin, high-popularity items ('stars') should be promoted and protected from cost creep; high-margin, low-popularity items ('puzzles') may need better menu positioning or renaming to sell more; low-margin, high-popularity items ('workhorses') may need a small price increase or cheaper ingredient substitution; and low-margin, low-popularity items ('dogs') are usually candidates for removal. This approach matters more for anyone running a small food business or supper club than for simple home cooking, but understanding contribution margin rather than fixating purely on cost percentage leads to materially better pricing decisions.

Worked Example: Food Cost Percentage for a Dish

A restaurant dish sells for £14.00 and the raw ingredient cost, including garnish and any accompaniments, comes to £3.92. Food cost percentage is calculated as ingredient cost ÷ selling price × 100, which gives 3.92 ÷ 14.00 × 100 = 28%. Most full-service restaurants target an overall food cost percentage somewhere in the region of 28–35%, so this dish sits at the efficient end of that typical range; a dish costing 45% would usually be considered too expensive to produce at that price point unless it's a deliberate loss-leader designed to draw customers in for other higher-margin items. Labour and overheads are not included in the food cost percentage figure at all — it measures only the raw ingredient cost against the selling price, so a dish with an excellent (low) food cost percentage can still be unprofitable overall if it's unusually labour-intensive to prepare, which is why food cost percentage is one input into pricing decisions rather than the only one.

What should I know about Typical Food Cost Percentage Targets by Category?

These figures are common industry rules of thumb rather than fixed rules, and a well-run business usually manages food cost percentage across the whole menu rather than dish by dish — some items (like a signature steak) are deliberately allowed a higher food cost percentage because of their draw, while cheap-to-produce items like chips, bread, or soft drinks are priced to run a much lower percentage and help subsidise the overall average. For home cooks comparing cooking from scratch against takeaway or ready-made alternatives, the same logic can be flipped around: calculating the ingredient cost of a homemade version of a dish against what the equivalent takeaway or supermarket ready-meal costs is a quick way to see where the real savings — or lack of them — actually lie.

What should I know about Seasonal Price Fluctuation?

Ingredient prices, especially for fresh produce, fish and some meats, can vary significantly across the year due to seasonality, weather affecting harvests, and supply chain factors, which means a food cost percentage calculated at one point in the year may drift meaningfully by another. Menus that rely heavily on seasonal ingredients are often re-costed periodically throughout the year rather than once, and some kitchens deliberately design seasonal menu changes partly around ingredient cost and availability, using cheaper, abundant seasonal produce to protect margins during months when other core ingredients become more expensive. This is also why a single 'target' food cost percentage figure is best treated as an average to aim for across the year, rather than a number every single dish must hit individually every month, since some ingredients will run temporarily above target cost in their off-season while others compensate by running comfortably below it. Tracking food cost percentage by dish over time, rather than just overall, makes it easier to spot which specific menu items are being squeezed by a seasonal price rise and may need a temporary price adjustment or ingredient substitution.