Restaurant food cost control: the formula, the leaks and the fixes
Restaurant food cost is the share of your food sales spent on the food itself. Controlling it means knowing the number every week, finding where it leaks, and fixing the leak, not just raising prices.
The food cost formula
Food cost % = cost of food used ÷ food sales × 100.
Cost of food used = opening stock + purchases − closing stock. So if you started the week with ₹60,000 of food, bought ₹1,40,000, and ended with ₹50,000, you used ₹1,50,000. On food sales of ₹4,50,000 that is a food cost of 33%.
Work it out the same way every week, from a real count, not an estimate. A monthly number tells you there was a problem; a weekly one tells you in time to fix it.
What a healthy food cost looks like
Many restaurants aim for a food cost of about 28 to 35%, but the right number depends on your menu and prices. A tandoor-heavy menu, a seafood menu and a café each sit differently. More useful than an industry average is your theoretical food cost: what the food should have cost if every plate followed its recipe. The gap between actual and theoretical is your leak.
Where food cost leaks
- Waste: prep made too far ahead, food past its use-by date, plates sent back
- Portions: a heavier hand than the recipe, garnish creep, free extras
- Theft and loss: stock leaving the store without a record
- Prices: suppliers raising prices quietly; deliveries short or over the order
- Recording: sales not entered, staff meals and comps not recorded
How to bring it down
- Cost every recipe from what you actually paid, and recost when prices change
- Count the main stores weekly against par; count expensive items more often
- Record waste the day it happens, with the reason
- Check every delivery against the order and the bill before signing
- Make prep to the day's bookings, and use what expires first
- Compare stock used with POS sales every day, not every month
Look at the menu, not just the kitchen
Menu engineering sorts dishes by how much they earn and how well they sell. Keep the popular, high-margin dishes; rework or reprice the popular, low-margin ones; and drop what neither sells nor earns. A small change in what guests order can move food cost more than a month of tighter portions.
How Senior does it
Hey Senior costs every recipe from the prices on your bills, counts each store against par, records waste and breakage the day they happen, and sets your POS sales against the stock used so the gap shows the next morning. Menu engineering shows which dishes earn most. See recipe costing and inventory management.
Put this list on every phone.
Senior gives each person their part of it, with photos and sign-offs.