Poor alignment between purchasing and menu costs you money directly. You buy ingredients you don't sell, or you sell dishes whose ingredients have become too expensive. Here's how to calculate exactly what this misalignment costs you each month.
Where does it go wrong between purchasing and menu?
The problem often lies in three areas: you buy too much of ingredients that don't sell well, your menu is full of dishes with expensive ingredients that perform poorly, or your supplier raises prices but you don't adjust your menu.
💡 Example: Restaurant De Keuken
Menu has 25 dishes, but 5 dishes account for 70% of sales:
- Steak: 30% of all orders
- Salmon: 20% of all orders
- Pasta carbonara: 20% of all orders
- The other 22 dishes: 30% combined
For those 22 dishes you still need to buy ingredients, but they sell poorly. That costs money.
Calculate your current mismatch
To calculate the financial impact, you need three numbers: your purchase price per ingredient, how much you actually sell, and what gets thrown away.
⚠️ Note:
Don't just count what literally goes in the trash. Ingredients you have to throw away because they're past their date also count as loss.
The formula for your mismatch loss is:
Loss = (Purchased - Sold) × Purchase price per unit
You do this per ingredient, then add them up for a total picture. It's the kind of thing you only learn after closing your first month at a loss - every ingredient matters.
💡 Example: Fresh basil
Last month:
- Purchased: 20 bunches at €2.50 = €50
- Used in sold dishes: 12 bunches
- Thrown away (past date): 8 bunches
Loss: 8 × €2.50 = €20 (40% of your purchase!)
Calculate impact per dish
Now you look at which dishes cost the most due to poor alignment. For this you use the actual food cost instead of the theoretical food cost.
- Theoretical food cost: what the dish costs if you only count the ingredients that go on the plate
- Actual food cost: theoretical food cost + share of waste and excess purchasing
The formula: Actual food cost = Theoretical food cost + (Loss per ingredient ÷ Number of sold portions with that ingredient)
💡 Example: Pasta with basil
Last month sold: 60 portions
- Theoretical ingredient costs: €4.20 per portion
- Basil loss: €20 ÷ 60 portions = €0.33 extra per portion
- Actual ingredient costs: €4.20 + €0.33 = €4.53
At selling price €16.50 excl. VAT: food cost rises from 25.5% to 27.5%
Prioritize your actions based on impact
Not all mismatches cost the same. Focus first on the biggest leaks: dishes with expensive ingredients that sell poorly, or popular dishes where the actual food cost is too high.
Make a list of all your dishes with:
- Number sold per month
- Theoretical food cost
- Actual food cost (including waste)
- Difference in euros per portion
Multiply the difference per portion by the number sold. That gives you the total impact per dish.
💡 Example: Impact ranking
- Steak: €0.15 difference × 150 portions = €22.50 impact
- Fish dish with expensive garnish: €1.20 difference × 25 portions = €30 impact
- Pasta basil: €0.33 difference × 60 portions = €19.80 impact
The fish dish has the highest impact despite low sales.
Calculate your savings potential
For each problem you can calculate the potential savings. There are three solution directions: replace ingredients with cheaper alternatives, remove dishes from the menu, or raise menu prices.
⚠️ Note:
Always account for possible volume loss when calculating price increases. A 10% price increase with 5% fewer sales nets 4.5% more revenue, not 10%.
The formula for savings by removing a dish: Monthly savings = (Actual food cost - Theoretical food cost) × Number of sold portions
For price increase: Extra margin = New margin per portion × Expected number of portions after price increase
How do you calculate the financial impact? (step by step)
Gather purchasing data from last month
Note per ingredient: how much you purchased, what it cost, and how much you threw away. Also include what went past its date. This is your base data for all further calculations.
Calculate loss per ingredient
Subtract the amount used from the amount purchased. Multiply the difference by the purchase price. This gives you the loss in euros per ingredient.
Distribute loss over sold dishes
Divide the loss per ingredient by the number of portions in which you used that ingredient. Add this to the theoretical cost price for the actual food cost per dish.
Calculate total impact per dish
Multiply the difference between actual and theoretical food cost by the number of sold portions. This gives you the financial impact per dish per month.
Prioritize based on greatest impact
Rank your dishes by financial impact. Focus first on dishes where you lose the most money, not necessarily on the highest loss percentage.
✨ Pro tip
Track your top 3 profit-margin dishes over the next 30 days to spot hidden waste patterns. Even a €0.20 hidden cost on a dish you sell 100 times monthly adds up to €240 in lost profit.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
Was this article helpful?
Frequently asked questions
Do I need to do this for all ingredients?
Start with your 10 most expensive ingredients and ingredients that spoil quickly. That already gives you 80% of the insight. Later you can expand to all ingredients.
How often should I calculate this?
Do this monthly for a good picture. Weekly is too much work, quarterly you see trends too late. A month gives enough data without it becoming outdated.
What if I don't have exact purchasing data?
Start by estimating based on receipts from your supplier. Not perfect, but better than nothing. From next month onwards you'll track it exactly.
Should I include staff costs in this calculation?
No, this is only about the mismatch between purchasing and menu. Personnel costs are a separate cost item that you need to analyze separately.
What is an acceptable loss percentage?
Between 5% and 12% of your total purchasing is normal for fresh products. Above 15% you probably have a system problem you need to address.
How do I handle ingredients used across multiple dishes?
Allocate the waste proportionally based on usage per dish. If pasta uses 60% of your basil and risotto uses 40%, split the basil waste accordingly across those dishes.
📚 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.
Manage inventory without spreadsheets
Always know what you have in stock and what it's worth. KitchenNmbrs connects inventory to recipes and purchasing for complete oversight. Start your free trial.
Start free trial →