Most restaurants guess at their dish profitability, but smart operators know the exact margin on every plate. Once you've established portion standards, calculating precise margins becomes straightforward. You'll finally know which dishes deserve prime menu placement and which ones drain your profits.
From portion standard to exact margin
Your portion standard shows exactly how much of each ingredient goes into one serving. From years of working in professional kitchens, I've seen how this data transforms guesswork into precise cost control and reliable margin calculations.
💡 Example:
Pasta Carbonara - portion standards:
- Pasta: 120g at €3.20/kg = €0.38
- Bacon: 80g at €12.50/kg = €1.00
- Cream: 100ml at €2.80/liter = €0.28
- Egg: 2 pieces at €0.25 = €0.50
- Cheese: 30g at €18.00/kg = €0.54
Total cost price: €2.70
Calculate your food cost percentage
With your cost price from portion standards, you'll calculate the food cost percentage. This percentage shows how much of your selling price goes toward ingredients.
Formula: Food cost % = (Cost price / Selling price excl. VAT) × 100
💡 Example:
Pasta Carbonara selling price: €18.50 incl. VAT
- Selling price excl. VAT: €18.50 / 1.09 = €16.97
- Cost price: €2.70
- Food cost: (€2.70 / €16.97) × 100 = 15.9%
Excellent margin - plenty of room for other costs
Calculate your gross margin in euros
The gross margin represents what remains after deducting ingredient costs. This amount must cover all other expenses: staff wages, rent, utilities, and your profit.
Formula: Gross margin = Selling price excl. VAT - Cost price
💡 Example:
Pasta Carbonara:
- Selling price excl. VAT: €16.97
- Cost price: €2.70
- Gross margin: €16.97 - €2.70 = €14.27
From each pasta sold, €14.27 remains for all other costs.
Compare your margins per dish
With exact portion standards, you can compare all dishes side by side. This reveals which dishes generate the most profit and where you're missing opportunities.
- Sort by highest gross margin in euros
- Check which popular dishes have low margins
- Identify dishes with food cost above 35%
- Look for opportunities to replace expensive ingredients
⚠️ Note:
Always calculate with the selling price excl. VAT. The menu price includes 9% VAT for food. If you calculate with the VAT-inclusive price, your food cost will appear lower than reality.
Optimize based on margin data
With exact margin calculations, you can make targeted decisions about your menu and pricing strategy.
- Promote high-margin dishes: Place them prominently on the menu
- Adjust low-margin dishes: Raise price or lower cost price
- Replace losing items: Dishes with food cost > 40%
- Train staff: Let them know which dishes to recommend
💡 Example margin comparison:
Top 3 dishes by gross margin:
- Pasta Carbonara: €14.27 margin (15.9% food cost)
- Risotto: €12.80 margin (22.1% food cost)
- Steak: €11.50 margin (38.2% food cost)
Focus on selling pasta and risotto for maximum profit.
How do you calculate margin per dish? (step by step)
Gather all portion standards
List the exact quantities of all ingredients for each dish. Don't forget garnishes, sauces or oil. Work with weights and volumes, not with 'a bit' or 'to taste'.
Calculate cost price per serving
Multiply each quantity by the purchase price per unit. Add up all ingredient costs for the total cost price per serving. Check that you've included all costs.
Calculate food cost percentage
Divide the cost price by your selling price excl. VAT and multiply by 100. For food, calculate: menu price / 1.09 for the price excl. VAT. Aim for food cost below 35%.
Determine gross margin in euros
Subtract the cost price from your selling price excl. VAT. This amount remains for staff, rent, energy and profit. Compare all dishes on this gross margin.
Analyze and optimize
Sort your dishes by gross margin and food cost percentage. Promote high-margin items, adjust low-margin items or replace losing dishes. Update regularly when prices change.
✨ Pro tip
Calculate margins for your 8 most popular dishes within the next 2 weeks. If these core items maintain healthy margins above 25%, you've secured 75% of your profit foundation.
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 include VAT in my margin calculation?
No, always calculate with prices excl. VAT. You'll pay the VAT to the tax authority, so it doesn't belong in your margin. For food, divide the menu price by 1.09 to get the price excl. VAT.
What if a popular dish has a low margin?
You have three options: raise the selling price, lower the cost price by using cheaper ingredients, or accept the low margin as a 'loss leader' and compensate with high-margin side dishes and drinks.
How often should I update my margin calculations?
Check your top 10 best-selling dishes monthly. Suppliers regularly raise prices, especially for seasonal products. For large price increases (>10%) adjust immediately, otherwise you'll lose money without noticing.
📚 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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