Most restaurant owners drastically underestimate their true dish costs by ignoring mise-en-place labor. Prime cost combines ingredient expenses with all labor needed per dish, including prep work. Here's how to calculate it accurately.
What exactly is prime cost?
Prime cost has two main parts:
- Food cost: every ingredient that ends up on the plate
- Labor cost: complete preparation time, including mise-en-place work
The math is straightforward:
Prime cost = Food cost + Labor cost per portion
💡 Example:
Beef Wellington for €45.00 (incl. 9% VAT):
- Ingredient costs: €12.00
- Labor costs: €8.50
- Prime cost: €20.50
Prime cost %: €20.50 / €41.28 (excl. VAT) = 49.7%
Calculate labor costs per dish
This part trips up most operators. You'll need the total time each dish requires, including all prep work.
Step 1: Calculate your hourly rate
Combine gross wages, employer taxes, and benefits. Then divide by actual productive hours.
💡 Example hourly rate:
- Gross chef wage: €18/hour
- Employer taxes (30%): €5.40
- Total hourly rate: €23.40
Step 2: Measure preparation time
Track every minute needed for one portion:
- Mise-en-place (knife work, marinating, sauce prep)
- Active cooking during service
- Final plating and garnishes
⚠️ Note:
Split mise-en-place time across portions it produces. Two hours of vegetable prep for 20 portions equals 6 minutes per portion.
Practical calculation with example
From tracking this across dozens of restaurants, I've seen operators consistently miss 15-20% of their true labor costs. Here's a Coq au Vin breakdown:
💡 Complete calculation:
Ingredient costs:
- Chicken thigh: €3.20
- Wine, vegetables, herbs: €2.80
- Total food cost: €6.00
Labor costs:
- Mise-en-place: 8 minutes × €23.40/60 = €3.12
- Service preparation: 12 minutes × €23.40/60 = €4.68
- Total labor cost: €7.80
Prime cost: €6.00 + €7.80 = €13.80
Calculate prime cost percentage
Like food cost calculations, prime cost becomes a percentage of your menu price excluding VAT.
Prime cost % = (Prime cost / Selling price excl. VAT) × 100
Using our example with a €28.00 menu price including VAT:
- Selling price excl. VAT: €28.00 / 1.09 = €25.69
- Prime cost %: (€13.80 / €25.69) × 100 = 53.7%
⚠️ Note:
Prime costs above 60% often signal trouble. You've still got rent, utilities, and indirect labor to cover.
Prime cost benchmarks
Typical prime cost ranges by restaurant style:
- Fine dining: 55-65% (complex preparations, intensive handwork)
- Casual dining: 50-60%
- Fast casual: 45-55% (streamlined processes)
- Pizzeria: 40-50%
These are starting points. Your concept, location, and market positioning matter more than industry averages.
Optimize prime cost
High prime costs? You've got three levers to pull:
- Ingredients: alternative products, smarter purchasing, waste reduction
- Preparation: streamlined mise-en-place, faster techniques
- Price: menu price increases (if your market supports it)
💡 Optimization example:
Batching mise-en-place for 10 portions simultaneously:
- Was: 8 minutes per portion
- Now: 60 minutes / 10 portions = 6 minutes per portion
- Savings: €0.78 per portion
How do you calculate prime cost? (step by step)
Calculate your total hourly rate
Add up gross salary, employer taxes (usually 25-35%) and any additional costs. This is what one hour of kitchen work actually costs.
Measure all preparation time per dish
Note mise-en-place time, active preparation time, and plating. Divide mise-en-place time across the number of portions it makes.
Calculate labor costs per portion
Multiply total preparation time (in hours) by your hourly rate. These are your labor costs per dish.
Add food cost and labor cost
Prime cost = ingredient costs + labor costs per portion. Divide by selling price excl. VAT for your prime cost percentage.
✨ Pro tip
Time your 3 highest-volume dishes during your next prep session, including every step from knife work to final garnish. These dishes drive 70% of your labor costs.
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 also include dishwashing costs in prime cost?
No, dishwashing falls under overhead expenses, not direct production costs. Prime cost strictly covers preparation and ingredients.
How do I measure mise-en-place time if I'm prepping multiple dishes at once?
Estimate time allocation percentages for each dish. If you prep for 2 hours and 60% supports dish A, allocate 1.2 hours to dish A.
Is a prime cost of 60% always too high?
Not always. Fine dining operations can run higher due to complex techniques and extensive handwork. Focus on overall profitability, not just prime cost percentages.
Should I use different hourly rates for chef and commis?
Absolutely. If your chef costs €25/hour and commis €18/hour, use whoever actually prepares that specific dish. This accuracy matters for precise costing.
How often should I recalculate prime cost?
Recalculate when wages change, ingredient prices shift, or you modify cooking methods. Most restaurants benefit from monthly or quarterly reviews.
Can I use food cost calculators for prime cost tracking?
Yes, tools like KitchenNmbrs can help track both ingredient costs and labor time per dish. Manual spreadsheets work too, but require more maintenance.
What if my mise-en-place supports dishes across multiple menu categories?
Break down shared prep work by usage volume. If you brunoise 2kg carrots and 60% goes to soups, 40% to entrees, allocate time proportionally across those categories.
📚 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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