Count the same way every period
The formula is simple and the count is where it breaks. Inventory has to be taken on the same day of the week, at the same point in the delivery cycle, by the same method, or the trend line means nothing.
Sales and COGS must cover the identical period. A 4 week purchase window compared against a calendar month is the single most common reason a food cost number looks wrong.
- /Count walk-in, dry storage, freezer, and bar separately, then total
- /Value at last invoice price, not at the price you remember paying
- /Exclude paper, chemicals, and small wares. Those are supplies, not COGS
- /Post credits and returns to the same period as the invoice
Price the plate, not the category
A target food cost is a portfolio number, not a rule for every item. High volume anchors can run heavier than target because they drive traffic, and beverage and sides carry the mix back down.
Cost the plate to the gram, including oil, garnish, and the bread nobody logs. Then set the price against the target and round up to your price ladder.
When a food cost problem is a capital problem
Product spend climbs for reasons money can fix and reasons it cannot. Portioning and waste are management. A failing walk-in that swings 10 degrees overnight, a freezer that frost-burns 800 dollars of protein a month, or a prep line that forces overbuying are equipment problems wearing a food cost costume.
Run the number for 3 consecutive periods before deciding which one you have. If the leak tracks a specific piece of equipment, an equipment finance agreement usually costs less per month than the spoilage it stops.
Calculator
Restaurant food cost calculator
Two numbers decide whether the kitchen is profitable: what you actually spent on product, and what you charge for it. Enter one period of inventory and sales, then price a single plate against the target you want to hold.
Every ingredient on the plate, including garnish and oil.
28 to 32 percent is the common target for full service.
A food cost problem is usually 3 problems: portioning, waste, and a price list that moved while your menu did not. Run this monthly, on the same close date, so the trend means something.
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Tell us about the operation and the results open up.
The math above runs on your inputs. Send the request and the figures unlock on this page, a specialist reviews what you entered, and you get written options to compare. No credit application, no hard pull.
We email you a copy of these figures. They are estimates for planning, not an offer, a quote, or a preapproval of any kind.
The arithmetic
COGS = beginning inventory + purchases - ending inventory. Food cost % = COGS / food sales x 100. Menu price = plate cost / target food cost %.
Sources
- 1Food cost percentage = cost of goods sold / food sales x 100Standard cost accounting identity. Cost of goods sold is beginning inventory plus purchases minus ending inventory for the same period the sales figure covers.
- 2Prime cost target: food plus labor at 55 to 65 percent of salesFoody Finance modeled assumption (modeled assumption, not a published figure). A planning band drawn from full service and limited service operating norms. Quick service and bar-forward concepts sit at the low end, full service at the high end. It is a benchmark, not a published statistic.
Estimates, not offers: Amounts, terms, and funding times are estimates based on programs commonly available in food service. Actual terms vary by program, lender underwriting, time in business, revenue, and credit profile. Nothing here is an offer of credit or a guarantee of approval.