How do I work out food cost for a dish in a UK restaurant?
Food cost is a portion's ingredient cost divided by its price excluding VAT. Work it out from the recipe card, then check it against your invoices.
Short answer
- List every ingredient at its net weight, as it lands on the plate.
- Multiply each weight by the purchase price per unit and add up the lines.
- Add the technical loss from cleaning, trimming and cooking.
- Take VAT off the menu price: at the standard 20% rate, divide by 1.20.
- Food cost % = production cost ÷ net price × 100. Set your target with your accountant.
A complete example: one portion of carbonara
Recipe card with net weights, purchase prices and plated cost
| Ingredient | Net weight | Purchase price | Plated cost |
|---|---|---|---|
| Spaghetti | 120 g | £2.40/kg | £0.29 |
| Guanciale | 60 g | £16.00/kg | £0.96 |
| Egg yolks (2) | 40 g | £0.30 each | £0.60 |
| Pecorino | 30 g | £22.00/kg | £0.66 |
| Pepper, salt, oil | — | — | £0.12 |
| Final cost (incl. 5% technical loss) | 250 g | — | £2.76 |
The calculation, step by step
The raw materials total £2.63; with 5% technical loss, the plate costs £2.76. The prices are illustrative.
The menu price is £14.50 including VAT. At 20%, the net price is £14.50 ÷ 1.20 = £12.08.
Food cost = £2.76 ÷ £12.08 × 100 = 22.8%, so £2.76 of every £12.08 of net sales goes on ingredients.
Watch the yield
Example: beef fillet at £32.00 per kilo, with only 780 g per kilo usable after trimming. The real cost is £32.00 ÷ 0.78 = £41.03 per kilo.
Costing from the invoice price, not the usable cost, understates the meat by almost 22%.
What UK rules say
- Restaurant food and drink carries the standard 20% VAT rate, so food cost is measured net of VAT.
- The recipe card underpins the 14 major allergen declaration (retained EU Regulation 1169/2011).
- Show prices clearly, and check with your accountant how VAT and service charges appear.
Common mistakes
- Dividing by the VAT-inclusive price, which makes the result about 17% too low.
- Using the gross invoice weight instead of the net weight on the plate.
- Forgetting the garnish, sauce and packaging, which add up quickly.
- Looking only at the percentage, not the pounds each portion leaves.
How 4restaurants.net helps
- Production cost is calculated from the recipe card, using your own weights.
- Net weights let trimming enter the cost correctly.
- Food cost is visible for each dish, alongside the reports by dish.