The food cost percentage formula is the most important ratio in food service: (Ingredient Cost ÷ Selling Price) × 100. Alternatively, use the reverse to find your minimum menu price from ingredient cost and a target food cost %. This tool handles both directions instantly.
Calculate Food Cost %
Find Minimum Selling Price
Rounded up to nearest $0.25 increment
Recommended Food Cost Ranges
Items above 40% food cost are difficult to sustain profitably. Consider reducing ingredient cost or raising the menu price.
How to Calculate Food Cost Percentage
Food cost percentage is the core metric that determines whether your menu is priced for profit. It answers: "For every dollar I take in, what share went to ingredients?" A 30% food cost means $0.30 of every revenue dollar paid for food — the remaining $0.70 must cover labor, rent, and profit.
Forward Calculation: Cost to Percentage
Use this when you want to check if an existing menu price is hitting your target: Food Cost % = (Ingredient Cost ÷ Selling Price) × 100. A burger with $3.50 in ingredients selling at $12: ($3.50 ÷ $12) × 100 = 29.2% food cost. Since this is within the 28-35% target range, the item is priced correctly.
Reverse Calculation: Cost to Minimum Price
Use this when pricing new menu items: Minimum Price = Ingredient Cost ÷ Target Food Cost %. If your burger costs $4.20 in ingredients and you want 30% food cost: $4.20 ÷ 0.30 = $14.00 minimum. If market prices for comparable items are $13, you have two options: reduce ingredient cost to $3.90 (90% of $4.20 × 30/100 = $3.90) or accept 32.3% food cost at $13 and compensate elsewhere.
What to Include in Ingredient Cost
Include everything that goes into one serving: main protein, all vegetables and garnishes, sauces and condiments, starches and grains, dairy, any beverages included with the dish, and packaging/containers. The mistake most operators make is costing only the main protein — a burger that's $2.00 in beef but $3.50 all-in (including bun, produce, sauce, container) dramatically changes the food cost calculation.
FAQ
How do you calculate food cost percentage?
Food cost percentage = (Ingredient Cost ÷ Selling Price) × 100. Example: if a dish costs $3.50 in ingredients and sells for $12, food cost % = ($3.50 ÷ $12) × 100 = 29.2%. This tells you what share of every dollar of revenue goes to food.
What is a good food cost percentage for a restaurant?
Most restaurants and food trucks target 28-35% food cost. Fast casual: 28-32%. Full-service restaurants: 28-35%. Food trucks: 29-35%. Fine dining: 28-35% (but at much higher selling prices). Above 38% makes it very hard to cover labor and overhead profitably.
What is the formula for minimum selling price from food cost?
Minimum selling price = Ingredient cost ÷ Target food cost percentage. Example: $3.50 ingredient cost at 30% target = $3.50 ÷ 0.30 = $11.67 minimum selling price. Round up to the nearest clean price point.
What counts as ingredient cost (food cost)?
Include all ingredients consumed per serving: protein, produce, dairy, starches, sauces/condiments, garnishes, and packaging/containers. Do not include labor, overhead, or marketing — those are separate cost categories. Be precise — even small packaging costs add up at high volume.
Is this food cost percentage calculator free?
Yes, completely free with no signup required. Use the forward calculation (cost → food cost %) or reverse calculation (cost + target % → minimum price) instantly.
How often should I recalculate food cost percentages?
Recalculate whenever ingredient prices change significantly. For high-volume items (your top 5 sellers), check monthly. For seasonal menu items, recalculate at each menu change. Quarterly reviews are a minimum — annual recalculations are how restaurants end up selling popular items at a loss.