A restaurant owner recently discovered their signature pasta dish was costing 42% instead of the assumed 28% - a difference that cost them €3,200 in lost profits over six months. Most establishments still operate on outdated recipe calculations from years past. Ingredient prices surge upward while menu prices remain static, silently eroding your margins.
Why old recipes are often unprofitable
Recipes developed years back relied on historical purchase prices. Post-2020, countless ingredients jumped 20-40% higher, yet most establishments failed to adjust menu pricing accordingly.
⚠️ Watch out:
A dish that had a food cost of 28% in 2019 could now cost 35-40% without you realizing it. Per dish you're losing €2-4 in margin.
Inventory your hidden costs
Before adjusting prices, you must understand your current position. This requires recalculating all ingredients for your top-performing dishes using today's purchase prices.
💡 Example: Classic steak
Recipe from 2019, recalculated now:
- Steak 250g: €8.50 (was €6.00)
- Potatoes: €0.80 (was €0.60)
- Vegetables: €1.20 (was €0.90)
- Sauce and butter: €1.00 (was €0.70)
Total now: €11.50 (was €8.20)
At selling price €32.00: food cost now 39% (was 28%)
Prioritize: start with your bestsellers
You don't need to tackle all 50 dishes simultaneously. Focus on your 5-8 highest-volume dishes first. These drive 70-80% of revenue, delivering maximum impact.
- Review your POS data: which dishes sell most frequently?
- Recalculate these using current supplier prices
- Dishes exceeding 35% food cost need immediate attention
Three scenarios per dish
Each dish with excessive food costs presents three solutions:
💡 Example: Pasta carbonara
Current situation:
- Ingredient costs: €6.80
- Selling price: €18.50 (€16.97 excl. VAT)
- Food cost: 40% - too high!
Options:
- Raise price to €21.50 → food cost 34%
- Reduce portion (200g pasta → 180g) → €6.20 costs, 37% food cost
- Use cheaper ingredient (different bacon) → €5.80 costs, 34% food cost
Communicate price increases
Many operators fear raising prices, but it's essential for maintaining profitability. I've seen this mistake cost the average restaurant EUR 200-400 per month in lost margins. Customers expect price adjustments during inflationary periods.
- Don't increase everything simultaneously - phase changes over 2-3 months
- Begin with your biggest loss-makers
- Be transparent: "Due to rising ingredient costs..."
⚠️ Watch out:
Better to raise 3 dishes by €2-3 than 10 dishes by €0.50. Large increases on popular dishes have more impact than small increases everywhere.
Document new recipes correctly from day one
After addressing legacy recipes, ensure new dishes get properly costed immediately. This prevents repeating the same issues years later.
Food cost calculators help by automatically computing margins for each new recipe, eliminating surprises from unprofitable dishes.
How do you tackle old recipes? (step by step)
Select your 5 best-selling dishes
Check your POS system or notes from the last 3 months. Which dishes do you sell most often? These have the biggest impact on your profit and deserve priority.
Calculate the actual costs
Go through each ingredient with your current purchase prices. Don't forget anything: oil, butter, spices, and garnish too. Add up everything that goes on the plate.
Calculate the new food cost percentage
Divide total ingredient costs by your selling price excl. VAT and multiply by 100. Anything above 35% needs action: raise the price, adjust the portion, or find a cheaper ingredient.
✨ Pro tip
Audit your 3 highest-volume dishes within the next 48 hours. If these maintain healthy margins, you've addressed 50-60% of potential profit leakage immediately.
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
How many dishes do I need to recalculate at once?
Focus on your 5-8 top sellers first. These drive 70-80% of revenue, delivering maximum impact. Tackle remaining dishes gradually.
What if my food cost exceeds 40%?
You're likely losing money on that item. Three options exist: increase price, reduce portions, or substitute cheaper ingredients. Usually combining approaches works optimal.
How frequently should I update recipe costs?
Minimum twice yearly, or immediately after supplier price hikes. Many operators review bestsellers quarterly to avoid nasty surprises.
Should I adjust portions instead of raising prices?
Depends on your concept and positioning. Fine dining requires consistent portions; casual concepts offer more flexibility. Test customer acceptance carefully.
What if old recipes weren't documented properly?
Observe your kitchen team preparing the dish currently. Measure exact quantities and document everything as your new standard recipe.
Can I raise prices on seasonal specials differently?
Absolutely. Seasonal items allow more pricing flexibility since customers expect variation. Use these to test higher margins before adjusting core menu items.
How do I handle dishes with multiple protein options?
Calculate each protein variant separately - chicken, beef, and fish have vastly different cost structures. Price each option to maintain target food cost percentages.
📚 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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