Turn a plate cost into a menu price at your target food cost, with the margin on every plate and a price ladder.
Cost every ingredient on the recipe card at this month's invoice prices.
Get the Operator's Edge. Free weekly tools and cost control tips for restaurant, bar and club operators.
It turns a plate cost into a menu price: it adds a Q factor for the small costs a recipe card misses, divides by your target food cost, rounds to a clean menu price and shows the contribution margin you earn on every plate. Add today's price and weekly sales to see what the gap is worth over a year.
Cost the plate from the recipe card at this month's invoice prices, using yields for anything trimmed or cooked. The recipe costing guide and the recipe yield guide cover both.
Add a Q factor and set the target for this item. Price proteins to a higher percent and a strong dollar margin; price starters, pasta and sides to a lower percent.
Compare against today's price and the weekly count. The price ladder shows the margin at five targets so you can choose where this dish sits on the menu.
Loaded plate cost equals plate cost plus the Q factor. Menu price equals loaded plate cost divided by target food cost percentage. Contribution margin equals menu price minus loaded plate cost.
Example: a chicken entree with a $6.80 plate cost and a 5 percent Q factor has a loaded cost of $7.14. At a 30 percent target the price is $23.80, so $24 on the menu, with a $16.86 contribution margin. At today's $22 price the item runs at 32.5 percent; at 120 plates a week the $2 difference is worth about $12,480 a year.
| Method | How it works | Best for |
|---|---|---|
| Food cost percentage | Plate cost divided by the target percent | Most items; keeps the blended food cost on target |
| Markup multiplier | Plate cost times a factor (3.3 times is about 30 percent) | Quick checks on the line or at the pass |
| Contribution margin | Plate cost plus the dollars the dish must earn | High-cost proteins and premium items |
Price is only half of it. How a dish sells against the rest of the menu decides whether to promote it, reprice it or drop it. That is menu engineering.
Recost the top sellers first. Twenty items usually make most of the sales, and a price creep on any of them moves the whole food cost.
Check the competition and the guest, not just the math. A price that hits the target but breaks a price point the guest notices can cost covers.
Change prices at a menu print, with the analysis done first. The menu change example walks through a full recost before the new menu goes out.
Start from the plate cost (every ingredient at today's prices), add a small allowance for things you cannot portion exactly, then divide by your target food cost percentage. A $7.14 plate at a 30 percent target is $23.80, which most menus would round to $24.
Most full service restaurants target 28 to 32 percent across the menu, but individual items vary. Proteins like steak and seafood often run 35 to 40 percent and earn their keep in dollars; pasta, salads and appetizers often run 20 to 26 percent. Manage the mix, not every item to the same number.
The Q factor is an allowance for the small costs that are hard to portion on a recipe card: oil, salt, butter for the table, condiments, garnish and the odd extra. Operators usually add 2 to 5 percent of the plate cost, or a flat amount per plate.
Use both. The percent keeps cost in check; the contribution margin (price minus plate cost) is what pays the bills. A $34 steak at 38 percent earns $21.08 a plate, more than a $16 pasta at 22 percent earns. Menu engineering uses both numbers to decide what to promote.
Recost the plate, then divide by your target. If a plate's cost rises from $7 to $7.70 and you target 30 percent, the price that holds your target moves from $23.33 to $25.67. Many operators raise in steps at each menu print rather than every time an invoice changes.
Keep every plate costed with the Recipe Cost Card System, and classify the whole menu with the Menu Engineering Matrix.
Check your food cost Read the menu engineering guideRules of thumb only. Results are estimates and not financial advice.
