The formula is the easy part
Ingredient cost divided by net selling price, multiplied by 100. A dish at £18 on the menu is £15 once VAT is removed. If the plate costs £4.50 to build, it runs at 30 per cent.
That is the arithmetic. The discipline is everything around it: what you count, how often you count it, and what you do when the answer moves.
Cost the plate, not the invoice
A recipe specification lists every ingredient as it lands on the plate, not as it arrives at the back door. Trim, bones, peel and evaporation all count against you. So do the oil in the pan, the butter on the bread and the micro herbs nobody remembers ordering.
If a dish has no written specification, it has no food cost. It has a guess.
If a dish has no written specification, it has no food cost. It has a guess.
Theoretical against actual
Your theoretical food cost comes from specifications multiplied by what you sold. Your actual food cost comes from purchases, adjusted for opening and closing stock, divided by net food sales.
Those two numbers will never match. The space between them holds over portioning, waste, unrecorded staff food, theft and supplier price creep. Reduce the gap and you have found margin without touching a single menu price.
Make it a weekly habit
Monthly food cost tells you what went wrong a month ago. A weekly count of your highest value lines tells you what is going wrong now. Pair it with a review of any supplier price changes, and your specifications stay honest.
- Pick your five best selling dishes and check each has a current, written specification.
- Re-cost them against this week’s invoices.
- Count your ten most expensive stock lines on the same day each week.
In Eight Rabbits, every dish lives as a costed specification connected to purchasing, so the theoretical figure updates as prices move and the gap is reviewed weekly rather than discovered at quarter end.
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