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Basic knowledge and formulas

Learn the fundamental formulas and calculation methods for hospitality.

What's the difference between gross margin and net margin?

Your restaurant could be bleeding money even with perfect ingredient costs. Gross margin shows profit after direct costs like ingredients, while net margin reve...

⏱️ 2 min read 👁️ 286 📅 21 Feb 2026
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How do you choose between a round price and a...

Menu pricing directly impacts both your profit margins and customer perception of your restaurant. Most operators face the same dilemma: round prices (€25.00) v...

⏱️ 3 min read 👁️ 284 📅 22 Feb 2026
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How can I make dishes with low food cost stand out?

Your most profitable dishes are probably hiding in plain sight. Low food cost items generate serious profit margins, yet customers gravitate toward the flashies...

⏱️ 3 min read 👁️ 282 📅 22 Feb 2026
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How can I use these figures in conversations with my bank?

Your bank doesn't care about your passion for cooking - they want cold, hard numbers. Food cost data and margin analyses prove you're running a business, not ju...

⏱️ 3 min read 👁️ 275 📅 22 Feb 2026
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How do I calculate the margin on a package with food and...

67% of restaurants underestimate their true package costs by ignoring VAT differences between food and alcohol. Food carries 9% VAT while drinks get hit with 21...

⏱️ 3 min read 👁️ 275 📅 21 Feb 2026
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How do I account for trim loss in my food cost?

Trim loss can dramatically inflate your food cost without warning. Most restaurant owners calculate based on purchase price per kilo, overlooking that processin...

⏱️ 3 min read 👁️ 275 📅 21 Feb 2026
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How do I calculate my restaurant's break-even point?

Your restaurant's break-even point is the exact number of covers needed to avoid losing money each month. Most owners operate without knowing this crucial figur...

⏱️ 3 min read 👁️ 274 📅 21 Feb 2026
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How do I calculate the cost price when a dish contains...

Picture this: your signature steak dinner includes a carefully selected wine pairing, but your food cost calculations seem off every month. Mixed VAT rates on c...

⏱️ 2 min read 👁️ 273 📅 22 Feb 2026
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How do I calculate the selling price of a lunch dish?

Setting lunch prices is like tuning a guitar - one string off and the whole melody sounds wrong. Too many lunch spots wing their pricing and watch profits disap...

⏱️ 4 min read 👁️ 273 📅 21 Feb 2026
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How do I read a supplier delivery report?

Your supplier's delivery report holds the key to accurate food costing, but most restaurant owners miss critical price changes and discrepancies that eat into p...

⏱️ 4 min read 👁️ 271 📅 22 Feb 2026
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What is a good margin on a wine pairing?

Most restaurants think wine pairing margins are just about the bottle cost - that's completely wrong. Your pairing profitability depends on hidden costs like ex...

⏱️ 2 min read 👁️ 271 📅 21 Feb 2026
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What's the difference between food cost and selling price?

Ever wonder why some dishes seem profitable until you actually crunch the numbers? Food cost is what you pay for ingredients, while selling price is what guests...

⏱️ 2 min read 👁️ 270 📅 21 Feb 2026
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How do I use portion control as a tool to reduce food waste?

Why do restaurants throw away profit with every plate they serve? Most food waste doesn't happen in the bin—it happens on the plate through oversized portions....

⏱️ 4 min read 👁️ 268 📅 27 Feb 2026
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How do I make sure my prices are both attractive and...

Some restaurants price dishes so low they lose money on every sale, while others set prices so high they drive customers away. Most restaurant owners rely on gu...

⏱️ 3 min read 👁️ 265 📅 22 Feb 2026
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How do I handle different VAT rates in my menu?

While most businesses deal with a single VAT rate, restaurants juggle multiple rates that can make or break your profit calculations. Food items get taxed at 9%...

⏱️ 2 min read 👁️ 263 📅 22 Feb 2026
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How do I know if I have too many different products on...

Too many different dishes on your menu can undermine your profit without you realizing it. Each extra dish costs time, inventory and attention - but does it gen...

⏱️ 3 min read 👁️ 259 📅 22 Feb 2026
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How do I determine my minimum selling price based on...

Your minimum selling price determines whether you make or lose money on each dish. Some restaurants nail their pricing and build solid profit margins, while oth...

⏱️ 3 min read 👁️ 257 📅 27 Feb 2026
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How do I set prices when working with market prices?

Most restaurant owners struggle with pricing because they copy competitors without knowing their own costs first. You might think you're being competitive, but...

⏱️ 3 min read 👁️ 256 📅 22 Feb 2026
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How do I calculate the cost price of homemade soft...

Homemade soft drinks seem cheap, but the real cost price often disappoints. While many hospitality entrepreneurs think making their own beverages saves money, t...

⏱️ 3 min read 👁️ 253 📅 22 Feb 2026
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What is waste in a restaurant?

Most restaurant owners don't realize they're throwing away 10-15% of their profits every single day. Waste isn't just the moldy tomatoes you toss in the bin. It...

⏱️ 3 min read 👁️ 251 📅 21 Feb 2026
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🔥 Most read in this category

The most viewed articles in Basic knowledge and formulas

1
What is food cost in a restaurant?
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2
What is the difference between food cost and cost price?
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3
What are typical margins on coffee and tea?
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