The cost of ingredients as a share of food sales — a core profitability metric most restaurants manage to the 28-35% range.
Food Cost Percentage
The cost of ingredients as a share of food sales — a core profitability metric most restaurants manage to the 28-35% range.
Food cost percentage is the cost of the ingredients used divided by the food sales they generated, expressed as a percent. Sell $10,000 of food that cost $3,000 to produce and your food cost is 30%. Most restaurants run food cost in the 28-35% range — roughly 28-32% for quick-service and 32-35% for fine dining.
It is calculated either on a plate ("theoretical" food cost from the recipe) or across a period ("actual" from beginning inventory + purchases − ending inventory, over sales). The gap between the two is waste, theft, over-portioning, or spoilage.
- Why 1-2 points matter: restaurant net margins are commonly only 2-6%, so a small move in food cost swings profit directly.
- How software helps: inventory and COGS tools like MarketMan and MarginEdge compute actual food cost from invoices and counts.
Food cost is half of prime cost, the number operators manage to most closely.