The cost price per dish determines whether you make a profit or loss. Many restaurant owners estimate this, causing them to unknowingly lose money on popular...
The cost price per dish determines whether you make a profit or loss. Many restaurant owners estimate this, causing them to unknowingly lose money on popular dishes. In this article you'll learn to calculate exactly what each dish costs and how to use this to determine profitable prices.
What is cost price per dish?
The cost price per dish is the total value of all ingredients that go on one plate. This means literally everything:
- Main ingredients (meat, fish, vegetables)
- Garnishes and side dishes
- Sauces and dressings
- Oil, butter, herbs
- Bread, decoration, everything that leaves the plate
Many entrepreneurs forget the small things. A pat of butter here, some parsley there. That seems like little, but adds up quickly.
💡 Example:
Steak with fries and vegetables:
- Steak 200g: €4.80
- Fries 150g: €0.45
- Vegetables: €1.20
- Butter, herbs, oil: €0.35
- Sauce: €0.40
Total cost price: €7.20
The formula for cost price calculation
The basic formula is simple, but you must count all ingredients:
Cost price = Σ (Quantity per portion × Purchase price per unit)
Where Σ (sigma) means: add everything together. For each ingredient you calculate how much you use times the price, and then you add everything up.
💡 Example calculation:
Pasta carbonara:
- Pasta 100g × €0.024/g = €2.40
- Bacon 40g × €0.035/g = €1.40
- Egg 1 piece × €0.25 = €0.25
- Parmesan 15g × €0.045/g = €0.68
- Cream 50ml × €0.008/ml = €0.40
- Parsley, pepper, oil = €0.12
Total cost price: €5.25
Including cutting loss and waste
A crucial point that's often forgotten: not everything you buy ends up on the plate. With fish you have heads and bones, with meat fat and tendons, with vegetables peels.
Actual cost price = Purchase price / (Yield % / 100)
⚠️ Watch out:
With cutting loss your product becomes more expensive, not cheaper! You have less usable weight, so the price per kilo increases.
💡 Example cutting loss:
Whole salmon purchase:
- Purchase price: €18.00/kg
- Cutting loss: 45% (head, bones, skin)
- Yield: 55%
Actual fillet price: €18.00 / 0.55 = €32.73/kg
From cost price to selling price
Once you know the cost price, you can determine what you must charge at minimum to be profitable. Most restaurants maintain a food cost between 28% and 35%.
Minimum selling price excl. VAT = Cost price / (Desired food cost % / 100)
Then you multiply by 1.09 for the price including 9% VAT on your menu.
💡 Example pricing:
Cost price pasta carbonara: €5.25
Desired food cost: 30%
- Minimum excl. VAT: €5.25 / 0.30 = €17.50
- Menu price: €17.50 × 1.09 = €19.08
Round to: €19.50
Tracking cost price in practice
The theory is clear, but in practice prices change constantly. Suppliers raise rates, you switch suppliers, seasonal products become more expensive or cheaper.
That's why it's important to update your cost prices regularly:
- Check your 5 best-selling dishes monthly
- Update immediately when suppliers raise prices
- Watch for seasonal influences on fresh products
- Check if your portion sizes are still accurate
A system like KitchenNmbrs helps with this by automatically calculating when you adjust ingredient prices. Then you immediately see the impact on all your dishes.
⚠️ Watch out:
Calculating cost price is not one-time work. Prices change constantly, so you need to update your calculation regularly to stay accurate.
How do you calculate cost price per dish? (step by step)
Collect all ingredients and quantities
Make a list of literally everything that goes on the plate. Don't forget the garnishes, sauces, herbs and oil. Weigh or measure the exact quantity per portion.
Look up all purchase prices
Check your invoices for current purchase prices per kilo, liter or piece. Convert to the unit you use (for example from €18/kg to €0.018/gram).
Calculate costs per ingredient
Multiply the quantity per portion by the purchase price per unit. Do this for each ingredient separately.
Add everything together
Sum all individual ingredient costs into one total amount. This is your cost price per dish, excluding cutting loss.
Correct for cutting loss and waste
If you have cutting loss (with fish, meat, vegetables), divide your cost price by the yield percentage. With 20% loss you divide by 0.80.
✨ Pro tip
Check your cost price on your 5 best-selling dishes. If those are right, you have 80% of your profitability under control.
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
Should I include VAT in my cost price calculation?
No, you always calculate cost price excluding VAT. You pass VAT through to the tax authorities, it's not a real cost item for your business.
How often should I update my cost prices?
Check your best-selling dishes monthly and update immediately when suppliers raise their prices. With seasonal products this may be needed more often.
What if I have different suppliers for the same product?
Then use an average purchase price based on your actual purchase ratio. If you buy 70% from supplier A and 30% from B, weigh the prices accordingly.
Should I include labor costs in the cost price?
No, cost price only concerns ingredients. Labor costs, rent and other business costs you include in your total calculation, but not in the cost price per dish.
How accurately should I measure?
For main ingredients very precisely, for herbs and small additions you may estimate. You don't need to weigh a pinch of salt, but you should weigh the amount of meat.
What if my chef uses different portion sizes than I calculate?
Then your cost price doesn't match reality. Check regularly if actual portions match your calculation, and train your kitchen team on consistency.
📚 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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