How to calculate food cost percentage for a restaurant

Food cost percentage is what the food you used cost, divided by what you sold it for. The formula: (opening inventory + purchases − closing inventory) ÷ food sales × 100 [1] [2]. If you started the month with $6,200 of food, bought $14,800, ended with $5,700 and sold $46,000 of food, your food cost was $15,300, or 33.3% of sales.

Most restaurants aim for 28% to 35% [3] [4]. Below: the formula step by step, a worked month with the adjustments most guides skip, how to count stock so the number means something, a spreadsheet layout to copy, food cost per menu item, the gap between your actual and your ideal food cost, and ten ways to bring it down.

The food cost percentage formula

There are two versions. Use both; they answer different questions.

The first part of the kitchen formula, opening + purchases − closing, is your cost of goods sold (COGS) for food: what actually left the shelves [1] [2]. All four numbers must cover the same period [2].

Step by step: a worked month

1. Opening inventory: the value of all food on hand at the start, from last period's closing count. Example: $6,200.
2. Purchases: every food invoice dated inside the period, after credits for returns and shorts. Example: $14,800.
3. Closing inventory: count everything at the end, at what you paid for it. Example: $5,700.
4. Food used: $6,200 + $14,800 − $5,700 = $15,300.
5. Adjust (next section). Example: $300 of staff meals taken out: $15,000.
6. Food sales: from your POS, food only, before tax and tips. Example: $46,000.
7. Divide and multiply by 100: $15,000 ÷ $46,000 × 100 = 32.6%.

These are example numbers, not a benchmark. Your own first result is the baseline that every later week is compared with.

What to leave in and what to take out

The formula is simple; the arguments are about what goes into it. Pick your rules once, write them down, and use them every time, or the trend means nothing.

How to count inventory so the number is right

• Same day, same time, every period. Sunday night after close, say. A count before a big delivery and the next after it makes a week look wildly off.
• Count in the order the shelves are laid out, with a sheet that follows them: walk-in, freezer, dry store, line.
• Count in purchase units (cases, pounds, each) and price at the latest invoice price.
• Count what's open. A half bag of flour or a part tub of sauce counts as a part unit.
• Prepped food counts too. A batch of soup is its ingredients' value; estimate it the same way every time.
• Two people, one counting and one writing, is faster and catches errors.
• Weekly beats monthly. A monthly number tells you there was a problem four weeks ago. A weekly one lets you fix it while it's small. If a full weekly count is too much, count your 20 most expensive items weekly and everything monthly.

A spreadsheet to copy

One row per week. In Excel or Google Sheets, with the week in column A:

Watch column I more than H. One week's number swings with when deliveries land; the four-week figure shows the real direction.

Food cost percentage for one menu item

For a dish, add up what each ingredient on the plate costs, including the share you trim or cook away, and divide by its price. A burger with a plate cost of $3.90 sold at $13 runs 30%. The full method for costing a plate, with yield and a worked recipe, is in how to price a menu item.

Per-item percentages don't all need to hit your target. Fries may run 15% and a steak 40%. What matters is the blend across what you actually sell.

Actual vs ideal food cost: finding where the money goes

Your ideal (or theoretical) food cost is what you should have spent if every plate went out exactly to recipe and nothing was wasted: for each item, plate cost × number sold, added up, divided by food sales. Your POS's product mix report gives the numbers sold.

On $46,000 of food sales, ideal is $14,100 ÷ $46,000 = 30.7%. Actual was 32.6%. The gap, 1.9 points or about $900 that month, is food that went somewhere other than a sold plate: waste, over-portioning, mistakes, unrecorded comps, or theft. That gap is the number to chase. A gap that keeps growing is a kitchen problem; a high ideal number is a pricing problem.

What should food cost percentage be?

A target only makes sense next to your rent and labor. That's why many owners watch prime cost: food cost plus labor cost, as a share of sales. A common benchmark is 60% to 65% [7]. A place with a tiny team can carry a higher food cost; a place with high wages has to run food leaner.

Delivery apps and your real food cost

Food cost percentage is calculated on the menu price. On a delivery app you don't keep the menu price. On a $25 order through DoorDash Plus at 25%, you keep $18.75. A 30% food cost ($7.50) is then 40% of what you actually received. That's why so many owners raise app prices, and why orders on your own site are worth more. The app rates are set out in DoorDash's commission fee for restaurants.

When you work out a dish's food cost for the apps, divide by what you keep, not the menu price. If a dish is only profitable in the dining room, either price it up on the apps or leave it off the app menu.

Why food cost goes up

• Supplier prices rose and menu prices didn't. Check your top 20 items' invoice prices monthly; the USDA tracks food price changes if you want the wider picture [8].
• Portions drifted. A heavier hand on cheese or protein across a busy service adds up fast.
• Waste: over-prepping, spoilage, dropped plates, returns.
• Sales mix moved toward your higher-cost dishes. Food cost rose, but dollars earned may be fine.
• Counting errors: a missed shelf, a wrong unit, a price from last year.
• Invoice errors: short deliveries you paid for in full.
• Comps and staff food that never get written down.
• Theft. Uncomfortable, but a growing actual-vs-ideal gap with no other cause points there.

10 ways to lower food cost percentage

1. Cost every dish, and re-cost your top sellers whenever a main ingredient's price moves.
2. Raise the price of dishes running far above target, or change the recipe.
3. Write portion sizes on the line and use scoops, scales and ladles.
4. Keep a waste sheet by the bin: item, amount, why. Read it weekly.
5. Check every delivery against the invoice: weights, counts, temperatures.
6. Store first in, first out, with dates on everything.
7. Prep to a par sheet based on what you actually sell, not on habit.
8. Use trim in specials, staff meals or stocks.
9. Put high-margin dishes where diners look first; see menu pricing psychology for what's proven and what isn't.
10. Get quotes from a second supplier for your ten biggest items once a year.

Common mistakes

• Using purchases as food cost. Without opening and closing stock, a big stock-up week looks like a disaster and the next like a triumph.
• Mixing drinks into food, so a cheap soda trade hides an expensive kitchen.
• Dividing by total sales including tax.
• Counting on different days each period.
• Chasing a lower percentage over more dollars. A $30 steak at 40% leaves $18; a $12 pasta at 20% leaves $9.60. Sell the steak.

Questions

What is the formula for food cost percentage?

(Opening inventory + purchases − closing inventory) ÷ food sales × 100, all for the same period [1] [2]. For one dish: plate cost ÷ menu price × 100.

What is a good food cost percentage for a restaurant?

Commonly 28% to 35% [3] [4], lower for quick service. Judge it together with labor (prime cost, often 60% to 65% [7]).

How often should food cost percentage be calculated?

At least monthly, for your books; weekly if you want to fix problems while they're small.

Is food cost percentage the same as COGS?

No. COGS is the dollar amount of food used. Food cost percentage is COGS divided by food sales.

Do I include drinks in food cost?

Usually not. Track beverage cost on its own, because drinks run at different margins.

How do I calculate food cost percentage in Excel?

Put opening, purchases and closing in cells B2, C2 and D2 and food sales in E2, then =(B2+C2-D2)/E2 and format it as a percentage. The fuller layout is in the spreadsheet section above.

Once your prices are set, diners need to see them. You can build a free menu site from a photo of your menu, with prices you can change any time, and see more in how to put a restaurant menu online for free or all our guides.

Sources

1. How to calculate food costs, Restroworks, read Nov 3, 2026.
2. Food cost calculator, Petpooja, read Nov 3, 2026 (same period for all four values).
3. How to price a menu, Restaurant365, read Nov 2, 2026.
4. Restaurant menu pricing, Lightspeed, read Nov 2, 2026.
5. Restaurant menu pricing, Cuboh, read Nov 2, 2026.
6. Food and beverage industry financial benchmarks, Foodservice Financial Systems, Johnson & Wales University, read Nov 3, 2026.
7. Restaurant prime cost formula, Lightspeed, read Nov 3, 2026 (as listed in search).
8. Food price outlook, USDA Economic Research Service, read Nov 2, 2026.