Kitchen & cost
Food cost percentage: formula, examples and a calculator
Food cost percentage is the share of food sales spent on the ingredients that went into them: ingredient cost ÷ food sales × 100. A AED 52 dish whose ingredients cost AED 14.50 has a food cost of 27.9%.
Updated 7 min readBy the Dinivoo team
The formula
There are two versions, and you need both:
- Plate (theoretical) food cost = ingredient cost of one portion ÷ menu price × 100.
- Actual food cost for a period = (opening stock + purchases − closing stock) ÷ food sales × 100.
Always use prices and costs excluding VAT so the tax does not distort the result.
Per dish: plate cost
Cost each ingredient in the portion at what you currently pay. For a smash burger: patty AED 6.20, brioche bun AED 2.10, two cheese slices AED 2.40, sauce and salad AED 1.80, fries AED 2.00 — AED 14.50 in total. At a menu price of AED 52 (excluding VAT), food cost is 14.50 ÷ 52 × 100 = 27.9%.
To price for a target, divide the plate cost by the target percentage: to hit 30% on a AED 14.50 plate, price at 14.50 ÷ 0.30 = AED 48.33 or more.
Food cost calculator
Food cost calculator
Enter one dish. All amounts in AED, excluding VAT.
Food cost percentage
27.88%
Price for your target
AED 48.33
Per period: actual food cost
Suppose a month starts with AED 18,000 of stock, you buy AED 42,000 and close with AED 16,500. Ingredients used: 18,000 + 42,000 − 16,500 = AED 43,500. With food sales of AED 140,000, actual food cost is 43,500 ÷ 140,000 × 100 = 31.1%.
Why plate cost and actual cost differ
If your dishes are costed at 28% but the month comes in at 31%, the gap is usually one of:
- Waste — spoilage, prep errors and overproduction that were never recorded.
- Portioning drift — a heavier hand than the recipe.
- Price increases from suppliers that were not reflected in the plate cost.
- Unrecorded staff meals, comps and returns.
- Counting errors in opening or closing stock.
How to improve it
- Recost your top sellers whenever a supplier price changes.
- Record waste with a reason every day so the gap has causes, not guesses.
- Receive deliveries against purchase orders so the cost you calculate with is the cost you paid.
- Look at menu performance: a popular dish at 40% may need a price change; a slow one at 22% may need promoting.
Dinivoo does this continuously: recipes draw down ingredients as dishes sell, waste is logged with reasons, purchase receiving keeps costs current and reports show estimated food cost by dish and period. See restaurant inventory management in Dinivoo.
Frequently asked questions
- What is the food cost percentage formula?
- Food cost percentage = cost of the ingredients used ÷ food sales × 100. For one dish, divide the ingredient cost of a plate by its menu price (excluding VAT).
- What is a good food cost percentage for a restaurant?
- There is no single correct figure — it depends on the concept, pricing and labour model. Figures around 28–35% are commonly quoted for full-service restaurants, but your own trend over time is more useful than an industry average.
- Should I include VAT when calculating food cost?
- No. Use menu prices excluding VAT and ingredient costs excluding recoverable input VAT, otherwise the tax distorts the percentage.
See how Dinivoo handles this: Inventory, recipes & purchasing
Ingredient stock, recipes, waste, transfers, suppliers and purchase orders with receiving.
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