Picture this: you're watching customers scan your menu for thirty seconds before immediately ordering the cheapest main course available. That sinking feeling hits because you know those budget dishes barely turn a profit. Most operators price their menus based on hunches, creating exactly this scenario where diners either run from high prices or cluster around your least profitable offerings.
Check your current price structure
A properly structured menu shows logical pricing flow. Appetizers cost less than mains, and within each category you'll find smooth progression from budget options to premium dishes.
💡 Example of good price structure:
Bistro De Eetkamer:
- Appetizers: €8.50 - €12.50
- Main courses: €18.50 - €28.50
- Desserts: €7.50 - €9.50
Clear ranges, no weird jumps.
Pull out your menu and look for dramatic price gaps. Spot an appetizer at €6 followed by a sudden leap to €15? Or main courses at €19, €21, then €34? These pricing cliffs either frighten customers away or push them toward your cheapest items.
Calculate your food cost per dish
Your menu prices must match real ingredient costs. Aim for food costs between 28% and 35% - this sweet spot maintains profitability without scaring off diners.
💡 Example calculation:
Steak on your menu: €26.50 (incl. 9% VAT)
- Selling price excl. VAT: €26.50 / 1.09 = €24.31
- Ingredient costs: €8.20
- Food cost: (€8.20 / €24.31) × 100 = 33.7%
This is correct. Under 35%.
Run this math for your top sellers. From tracking this across dozens of restaurants, fixing your five most popular dishes resolves roughly 80% of profit problems.
⚠️ Watch out:
Always calculate using prices EXCLUDING VAT. Your menu displays prices with 9% VAT included. Many operators skip this step and assume their margins are healthier than reality.
Analyze your competition
Study 3-5 comparable restaurants in your area. You're not copying them - you're verifying if your pricing makes sense contextually.
- Significantly pricier? Your quality or atmosphere better justify the premium
- Much cheaper? You might be leaving money on the table
- Middle of the pack? You're probably positioned correctly
Pay special attention to main courses. That's where customers form their value opinions.
Check your profitability per category
Not every dish needs identical profit margins. But you must spot your winners and losers.
💡 Example analysis:
Restaurant De Smaak - weekly sales:
- Pasta carbonara: 45× sold, 29% food cost = winner
- Salmon fillet: 30× sold, 31% food cost = winner
- Ribeye steak: 12× sold, 38% food cost = loser
The ribeye needs repricing or removal.
Run this analysis monthly. Dishes that sell poorly AND carry high food costs are silently bleeding your profits.
Test your new prices carefully
Need to adjust prices? Don't shock customers with massive overnight changes. Start with your top performers and move incrementally.
- Cap increases at 10-15% per round
- Begin with dishes showing low food costs
- Monitor customer response for 2-3 weeks
- Then tackle remaining items
⚠️ Watch out:
Avoid blanket 20% increases across your entire menu. Customers notice aggressive price hikes and start shopping elsewhere. Gradual changes work better.
Use the right tools
Excel works initially but gets messy quickly. Especially when supplier costs fluctuate or you're adding seasonal items.
A food cost calculator automatically computes dish profitability and shows which items drive the most revenue. This gives you instant clarity on whether your pricing structure actually functions.
How do you analyze your menu? (step by step)
Gather all ingredient costs
Go through your entire menu and calculate what the ingredients cost for each dish. Add everything up: main ingredient, garnish, sauce, oil, butter. Don't forget anything.
Calculate food cost per dish
Divide the ingredient costs by your selling price (excl. VAT) and multiply by 100. Anything above 35% is too expensive to make for that price.
Check sales figures per dish
Look at how much you sell of each dish per week. Dishes that sell poorly and have high food cost are losers.
Compare with competition
Check 3-5 similar establishments in your area. Are your price levels in the ballpark? Big differences need to be justified.
Adjust prices where needed
Start with your most popular dishes that have too low margins. Increase by maximum 10-15% at a time and watch how guests react.
✨ Pro tip
Track your top 6 revenue-generating dishes against competitors every 8 weeks. These items typically account for 65% of your food sales, so keeping them competitively priced prevents customer defection.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
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Frequently asked questions
What's the ideal food cost percentage for most restaurants?
Target between 28% and 35% for most dishes. Below 25% often signals overpricing, while above 35% typically means you're losing money on that item.
Should I calculate food costs with or without VAT included?
Always exclude VAT from your calculations. Menu prices include 9% VAT, but food cost percentages must use the net selling price. Including VAT makes your margins appear artificially healthy.
How should I handle dishes with seasonal ingredient price swings?
Build a 15-20% cost buffer into seasonal items during menu planning. Track supplier prices weekly during peak seasons and adjust portions slightly rather than changing menu prices constantly.
📚 Sources consulted
- EU Verordening 852/2004 — Levensmiddelenhygiëne (2004) — Official source
- EU Verordening 853/2004 — Hygiënevoorschriften voor levensmiddelen van dierlijke oorsprong (2004) — Official source
- EU Verordening 1169/2011 — Voedselinformatie aan consumenten (2011) — Official source
- NVWA — Hygiënecode voor de horeca (2024) — Official source
- NVWA — Allergenen in voedsel (2024) — Official source
- Codex Alimentarius — International Food Standards (2024) — Official source
- FSA — Safer food, better business (HACCP) (2024) — Official source
- BVL — Lebensmittelhygiene (HACCP) (2024) — Official source
- Warenwetbesluit Bereiding en behandeling van levensmiddelen (2024) — Official source
- WHO — Foodborne diseases estimates (2024) — Official source
Food Standards Agency (FSA) — https://www.food.gov.uk
The HACCP standards shown in this application are for informational purposes only. KitchenNmbrs does not guarantee that displayed values are current or complete. Always consult the FSA or your local authority for the latest regulations.
Written by
Jeffrey Smit
Founder & CEO of KitchenNmbrs
Jeffrey Smit built KitchenNmbrs from 8 years of hands-on experience as kitchen manager at 1NUL8 Group in Rotterdam. His mission: give every restaurant owner control over food cost.
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