What is a good food cost percentage?
Most restaurants target roughly 28–35%, varying by concept. Track the trend rather than a single number, and react when it climbs.
Restaurant Finance
How to Calculate Food Cost Percentage (With Example)
6 min read
Food cost percentage is the cost of ingredients divided by the revenue they generate. Multiply by 100 to get a percentage; most restaurants target roughly 28–35%. Recipe costing in a POS calculates it automatically by deducting ingredients on every sale. Here's the formula and an example.
The formula
Food cost percentage = (cost of ingredients ÷ revenue from those items) × 100. You can calculate it per dish or across the whole menu for a period.
A worked example
Say a dish uses EGP 30 of ingredients and sells for EGP 100. Its food cost percentage is (30 ÷ 100) × 100 = 30%. Across a week, if ingredients used cost EGP 60,000 and food revenue was EGP 200,000, your food cost is 30%.
What's a good target?
Most restaurants aim for roughly 28–35%, but it depends on concept — a steakhouse runs higher, a café lower. The number matters less than the trend: watch it move and react before it eats your margin.
Let the POS do it for you
Calculating this by hand is tedious and quickly out of date as prices move. A recipe (bill of materials) in your POS links each product to its ingredients and deducts them on every sale, so food cost is tracked continuously. WDPW does this and surfaces menu-engineering and stock-valuation views in analytics.
FAQ
Frequently asked questions
How does a POS calculate food cost automatically?
By costing recipes: each product's bill of materials links it to its ingredients, so selling it deducts stock and updates food cost continuously. WDPW does this and shows it in analytics.
Next step
Book a demo