How to Calculate Restaurant Food Cost

Determining how much your restaurant spends on food can be challenging and tedious. When tomatoes are in season, they’re dirt cheap...and yet, your customers still want tomatoes in the middle of winter. You can’t increase menu prices to accommodate the fluctuation of ingredient availability, so it’s imperative that you learn how to calculate restaurant food costs to keep them from eating up too much of your overall budget. Without knowing labor and food cost, it can be difficult to appropriately price a new menu item. Charging too little will cause the restaurant to lose money on every order, while charging too much may result in no one ordering that dish. There’s a delicate balance between providing value to your customers while still eking out a profit.