High menu prices don't guarantee better profits. Smart restaurants focus on food cost percentages, not absolute prices. Learn how to build margins that actually work.
Your €45 steak might be losing you money while your €18 pasta makes you rich. Most restaurant owners obsess over raising prices but ignore the math that actually matters. Food cost percentage determines your real profit, not the numbers on your menu.
The difference between expensive and profitable
An expensive menu has high prices. A profitable menu has smart margins on each dish. Those are completely different strategies.
💡 Example:
Restaurant A sells steak for €45. Ingredients cost €18. Food cost: 40%
Restaurant B sells steak for €32. Ingredients cost €9. Food cost: 28%
Restaurant B makes more per dish, despite the lower price.
Why expensive dishes often generate less profit
Higher prices usually mean pricier ingredients. Wagyu beef, lobster, truffles - they eat into your margins fast. Once your food cost hits 40%, you're earning less than a simpler dish at 28%.
- Premium ingredients = higher purchase costs
- Customers expect bigger portions at higher prices
- More garnish and sides with expensive mains
- Waste hurts more with costly products
⚠️ Watch out:
A €50 dish with 40% food cost yields €30. A €25 dish with 25% food cost yields €18.75. But sell the second dish twice as often? You win.
How to recognize a profitable menu
Profitable menus keep food costs between 25% and 35%. Not necessarily the flashiest prices, but the smartest margins. From years of working in professional kitchens, I've seen too many chefs chase expensive ingredients while their profits disappeared.
- Food cost under 35% across all dishes
- Mix of price points (not just premium)
- Popular items with low food costs
- Seasonal menu using affordable ingredients
💡 Example profitable menu:
- Pasta carbonara: €18.50 - food cost 28%
- Chicken satay: €22.00 - food cost 30%
- Salmon fillet: €26.50 - food cost 32%
- Ribeye steak: €34.00 - food cost 35%
Every dish stays under 35% food cost, regardless of price.
The food cost formula
To check if your menu actually makes money, calculate food cost per dish:
Food cost % = (Ingredient costs / Selling price excl. VAT) × 100
Always calculate with the price excluding VAT. Your menu price includes 9% VAT.
💡 Calculation:
Pasta carbonara: €18.50 incl. VAT
- Selling price excl. VAT: €18.50 / 1.09 = €16.97
- Ingredient costs: €4.75
- Food cost: (€4.75 / €16.97) × 100 = 28%
Solid margin for pasta.
From expensive to profitable
If your menu looks impressive but doesn't deliver profits, adjust your dishes, not your prices. Find smarter ingredient choices or tweak portions.
- Swap wagyu for quality entrecote
- Use seasonal vegetables instead of exotic imports
- Right-size your portions
- Double down on dishes that sell well AND earn well
Check your own menu
Grab your 5 top-selling dishes. Calculate their food costs. If more than half exceed 35%, you're not earning enough. You've got an expensive menu, not a profitable one.
How do you turn an expensive menu into a profitable menu?
Calculate the food cost of your top sellers
Take your 5 best-selling dishes. Add up all ingredient costs and divide by the selling price excl. VAT. Multiply by 100 for the percentage.
Identify the losers
Dishes with a food cost above 35% are losers. Note which ones they are and why they're so expensive to purchase.
Optimize without losing quality
Replace expensive ingredients with cheaper alternatives, slightly reduce portions, or raise the price until the food cost comes under 35%.
✨ Pro tip
Track the profit per guest table turn, not just per dish. A €15 pasta with 28% food cost that turns tables every 45 minutes often outearns a €35 steak with 38% food cost and 90-minute table times.
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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 a good food cost percentage for restaurants?
For most restaurants, aim for 25% to 35% food cost. Fine dining can stretch slightly higher, while fast-casual should stay on the lower end.
Should I calculate food cost on gross or net menu prices?
Always use net prices (excluding VAT) for accurate calculations. Your €20 menu item is actually €18.35 net with 9% VAT. This affects your real margins significantly.
Can some dishes have higher food costs if they drive traffic?
Yes, but be strategic about it. A signature dish at 38% food cost might attract customers who order profitable sides and drinks. Just ensure your overall average stays under 35%.
📚 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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