Guides / Restaurants

Food cost percentage, explained in five minutes

What the number means, what a healthy range looks like, and why one point is worth more than you think.

5 minute readUpdated September 21, 2026

Skip the reading. The tool does this maths for you, free, as you type.

Food cost percentage is the share of a plate's selling price that goes to the ingredients on it. A burger that costs you $5.25 to make and sells for $17.50 has a food cost of 30%. The other 70% has to cover labour, rent, power, and whatever is left is profit.

The formula

Food cost % = ingredient cost ÷ menu price × 100. That is it. The hard part is not the maths, it is knowing the ingredient cost, which means knowing what you pay per pack, how much is in the pack, and how much of it you actually use after trim and waste.

What is a good number

Under 28%

Excellent. Common for pasta, pizza, soups, anything built on cheap starch.

28% to 32%

Healthy for a full-service restaurant. Most menus should average here.

33% to 35%

Watch it. Fine for a steak or seafood item that sells at a high price, dangerous as a menu average.

Over 35%

Something is wrong: the price is too low, the portion is too big, or a supplier moved and nobody noticed.

Why one point matters

A restaurant doing $60,000 a month in food sales loses $600 a month for every point its food cost drifts over target. Four points over, which is easy to do in a year of quiet supplier increases, is $28,800 a year that never becomes profit.

Worked example

The sample cheeseburger at $17.50, before and after a beef increase

Beef at $4.60/lb: $4.10 plate cost, 23% food cost
Beef at $5.80/lb: $4.58 plate cost, 26% food cost
Same menu price: $0.48 less per plate, every plate

Verdict Still priced right, but $0.48 × 530 plates a month is $254 gone. Log the price so you see it.

What to do about it

Cost every plate once, properly, with waste included.
Set a target per item, not just per menu. A salad and a ribeye should not share a target.
Log supplier prices when the invoice arrives. Re-costing by hand is where most kitchens give up.
Look at the menu as a whole. One high-cost item that sells a lot can be fine if the rest carries it.

Now do it with your numbers.

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