Moving on to food costs

So you have a tree but your costs don’t stop at the price of raw ingredients. Because they have to get to you somehow and be stored somewhere. In short, you need to factor in delivery and storage costs, as well as those unavoidable costs that nobody wants, like waste from unused ingredients or expired goods. 

Getting to the bottom line.

All your work is ultimately centered on one number — the price. How much do you want to make from the dish? What’s a reasonable price to charge for it? Is there a dish you can afford to lose money on? Every restaurant has its own considerations, and each dish has the profit you set for it. But it’s important to do this with data, control, and a full picture of the entire restaurant.

This is where the food cost calculation comes in, or in simple terms—the ratio between the cost of the food and its sale price. 

Most of the market prices food costs at around 30% of the dish’s price. 

It’s an important rule of thumb, but of course, there are exceptions. Handmade pastas are very cheap in terms of ingredients, but the process of making them is long and involves many steps, which also need to be factored into the price. 

And now to the bottom line 

Accurate pricing = calculating food costs + desired profit. You factor in the food cost, mix it all together, and get the price that works best for you.