Most restaurant owners underestimate their true ingredient costs by 20-40%. They calculate using purchase prices but ignore the reality of cutting losses, trimming, and waste. Here's how to find what you're really paying per usable gram.
Why net gram cost price matters
You buy a whole salmon for €18 per kilo. After filleting, you have 1.2 kg of fillet left from the 2 kg salmon. So you're actually paying €30 per kilo of fillet, not €18. This difference can make or break your profit margin.
⚠️ Note:
Many entrepreneurs calculate with the purchase price per kilo, but forget the cutting loss. This makes your food cost appear lower than it actually is.
The formula for net cost price
The calculation consists of two steps:
- Calculate yield: How much is left after processing?
- Calculate net cost price: Divide purchase price by yield
Yield formula:
Yield % = (Net weight / Gross purchase weight) × 100
Net cost price formula:
Net cost price per gram = Purchase price per gram / (Yield % / 100)
💡 Example: Filleting a whole salmon
You buy 2 kg whole salmon for €36 (€18/kg):
- Purchase weight: 2,000 grams
- After filleting: 1,200 grams fillet
- Cutting loss: 800 grams (head, bones, skin)
Yield: (1,200 / 2,000) × 100 = 60%
Net cost price: €0.018 / 0.60 = €0.030 per gram
Common cutting losses
Each ingredient has a different yield. From tracking this across dozens of restaurants, these percentages hold true:
- Fish (whole to fillet): 40-60% yield
- Beef (whole to portions): 75-85% yield
- Vegetables (peeling): 80-90% yield
- Shrimp (unpeeled): 50-65% yield
- Fruit (peeling, pits): 60-80% yield
💡 Example: Peeling potatoes
You buy 10 kg potatoes for €8 (€0.80/kg):
- Purchase weight: 10,000 grams
- After peeling: 8,500 grams
- Peeling loss: 1,500 grams (15%)
Yield: 85%
Net cost price: €0.0008 / 0.85 = €0.00094 per gram
Practical application in recipes
Always use the net cost price in your recipe calculations. If your recipe calls for 200 grams of salmon fillet, calculate with €0.030 per gram, not the purchase price of €0.018.
💡 Example: Calculating recipe costs
Salmon dish with 180 grams fillet per portion:
- Wrong: 180g × €0.018 = €3.24
- Correct: 180g × €0.030 = €5.40
Difference: €2.16 per portion!
Recording and monitoring
Keep track of the following with each delivery:
- Purchase weight and price per kilo
- Net weight after processing
- Actual yield (may differ from averages)
- Net cost price per gram
Check your yields regularly. A different supplier or season can affect the yield. In food cost management tools, you can record the yield per ingredient, so the net cost price is calculated automatically.
How do you calculate the net cost price per gram?
Measure the purchase weight and note the price
Weigh the product as you receive it and note the total purchase price. Calculate the price per gram by dividing the total price by the number of grams.
Process the product and weigh the net result
Process the ingredient as you would use it in the kitchen (filleting, peeling, boning) and weigh what remains. This is your net weight.
Calculate the yield percentage
Divide the net weight by the gross purchase weight and multiply by 100. This gives you the yield percentage.
Calculate the net cost price per gram
Divide the purchase price per gram by the yield (as a decimal). This is your actual cost price per gram of usable product.
✨ Pro tip
Track your actual yields for 3 weeks on your top 12 most expensive ingredients. Most restaurants discover their real costs are 15-25% higher than calculated.
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
Do I need to measure the yield for each ingredient?
For expensive ingredients yes, for cheap ones like onions you can work with averages. Always measure fish, meat and other costly products.
Can the yield differ per delivery?
Yes, especially with fish and seasonal vegetables. A different supplier or season can affect the yield. Check this regularly.
How often should I update the net cost price?
With each price change from your supplier and if you notice that the yield consistently differs from your calculation.
Should I also count small losses like trim?
Yes, trimming off bad parts or trimming meat also counts as cutting loss. Every gram you throw away increases your net cost price.
What if I use pre-packaged products?
Then there's usually no cutting loss and the purchase price per gram equals the net cost price. Do check that there are no damaged products included.
How do I handle bones and scraps that I use for stock?
If you use bones for stock, assign a value to them based on what commercial stock would cost. This reduces your effective cutting loss percentage.
Should I factor in staff time for processing ingredients?
While labor isn't part of ingredient cost per gram, you should track processing time separately. Some "cheap" whole ingredients become expensive once you add labor costs.
📚 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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