Food cost percentage
By Marji · Updated · Sources and editorial policy
Also called: food cost % · food cost percent
Food cost percentage is the plate cost of a dish divided by its menu price, expressed as a percent. A burger that costs $4.20 to make and sells for $15.00 runs a 28% food cost. The right target depends on your format, prices, labor and rent more than on any national figure.
Formula
Food cost % = Plate cost ÷ Menu price × 100
Use the cost of everything that leaves the kitchen on the plate — protein, sides, garnish, sauce, and the bread nobody counts.
Worked example · House burger
- Beef patty, 6 oz
- $2.35
- Bun
- $0.48
- Cheese, lettuce, tomato, onion
- $0.61
- Sauce + pickle
- $0.19
- Fries, 5 oz portion
- $0.57
- Plate cost
- $4.20
- Menu price
- $15.00
- Food cost percentage
- 28.0%
The same burger at $13.50 runs 31.1%. On this dish, a $1.50 price move is worth about three points of food cost.
Why it matters
Food cost percentage is the fastest read on whether a dish is priced against its cost. It travels well: you can compare a $9 sandwich to a $34 steak on the same scale.
It is also the number that moves without anyone touching the menu. When beef goes up 18% and your price stays put, the percentage climbs on its own. Tracking it monthly against your actual invoices is the difference between noticing in week two and noticing at year-end.
Where the percentage misleads
A percentage has no units. It cannot tell you how many dollars a dish puts in the till — and dollars are what pays rent.
| Dish | Price | Plate cost | Food cost % | Gross profit |
|---|---|---|---|---|
| Side salad | $7.00 | $1.96 | 28% | $5.04 |
| Ribeye | $42.00 | $11.76 | 28% | $30.24 |
Both dishes hit the same target. One of them earns six times as much per cover. This is why contribution margin belongs next to food cost percentage on every menu review, never instead of it.
Plate-level vs. period food cost
There are two food cost percentages and they answer different questions. Plate-level (above) is theoretical: what the recipe should cost. Period food cost is what actually happened across a week or month, computed from inventory:
Period food cost
(Opening inventory + Purchases − Closing inventory) ÷ Food sales × 100
The gap between the two is your variance — waste, over-portioning, comps, theft and errors in the recipes or counts all live in it. See theoretical vs. actual food cost.
What is a good food cost percentage?
It depends on your format more than on a national figure. In the National Restaurant Association's 2024 data, the median full-service restaurant spent 32.0% of sales on food and non-alcohol beverages and the median limited-service restaurant 32.4% — medians, not goals. A pizzeria and a steakhouse can both be healthy at very different percentages because their prices, labor and rent differ, so judge the percentage with prime cost and the dollars each dish contributes. The good food cost guide has the data and its limits.
Should food cost percentage include waste?
Plate-level food cost should include predictable trim and yield loss, because that cost is real on every plate — use edible portion cost, not the invoice price. Unpredictable waste (a dropped tray, a spoiled case) belongs in variance, not in the recipe.
How often should I recalculate it?
Whenever an ingredient price changes enough to move the dish, and on a fixed schedule besides. Recipes costed once at menu launch drift further from what the plate really costs with every price change, and nothing on the menu shows it.
Your food cost percentage, recalculated the day the invoice lands.
Marji reads your supplier invoices, recosts every dish that uses the ingredient, and names the ones that crossed your target. Photograph your menu to start.
Start free →Run the numbers
Food cost percentage calculator
The guide that works it through
How to Calculate Food Cost Percentage: The Formula, a Worked Month and a Worked Dish
The food cost formula — beginning inventory plus purchases minus ending inventory, divided by food sales — worked for a month and for one dish, with what counts as food and the mistakes that skew it.
Related terms
Plate cost
The total ingredient cost of one served portion, garnish and sides included.
Contribution margin
The dollars a dish contributes to overhead and profit after its ingredient cost — menu price minus plate cost.
Prime cost
Total cost of goods sold plus total labor cost — the two numbers that decide whether a restaurant survives.
Ideal food cost
The food cost percentage your menu would produce if every plate were made exactly to spec and nothing was wasted.
Gross margin vs. markup
Margin is profit as a share of price; markup is profit as a share of cost. Confusing them underprices a menu by several points.