What is food cost percentage?

Food cost percentage tells you how much of each dollar of food sales goes to ingredients. For a single dish the formula is plate cost divided by menu price, times 100. A burger that costs $3.90 to make and sells for $13.00 runs a 30% food cost. The rest of the price has to cover labour, rent, utilities and profit.

For a whole period the formula uses inventory: opening food inventory plus food purchases, minus closing food inventory, gives the cost of food used. Divide that by food sales for the same period. This actual figure includes waste, spoilage, over-portioning and theft, so it is almost always higher than the theoretical figure you get by adding up recipe costs.

Targets vary by concept. Many full-service restaurants aim for roughly 28 to 35%, pizza and pasta concepts often run lower, and steak and seafood houses higher. More useful than any industry target is your own trend: if actual food cost climbs two points while menu prices and recipes have not changed, something is going missing between the delivery door and the plate.

SeroPOS helps with both halves. Recipes in the Manufacturing tools (Pro plan) cost each dish from ingredient purchase prices, including a waste percentage, which gives the theoretical plate cost. The back office Profit / Loss report works from opening and closing stock, purchases and sales, and can be split by product or category, which gives the actual picture. Comparing the two shows how much is lost to waste and portioning.