Food cost percentage is the ratio of ingredient and raw-material costs to the revenue those ingredients generated, expressed as a percentage — (cost of food sold ÷ food revenue) × 100. It is the single number restaurant operators, food manufacturers, and caterers use to assess whether procurement discipline and recipe costing are keeping the business profitable, and it is set not by tracking alone but by the buying loop that sits upstream of every plate.
A connected purchasing record helps trace supplier cost changes, accepted quantities and credits. Recipe costing estimates consumption at specified inputs; accounting still reconciles actual period food cost using receipts, inventory and adjustments. A supplier reply does not by itself establish the final invoice amount or actual food consumed.
Quick answers
What is food cost percentage? Food cost percentage is total ingredient cost divided by total food revenue, multiplied by 100. If your kitchen consumed $2,800 of ingredients and generated $9,000 in food revenue in a week, food cost % is 31.1%.
What is the food cost percentage formula? Food Cost % = (Food Cost Sold ÷ Food Revenue) × 100, where food cost sold = beginning inventory + purchases − ending inventory.
What is a good food cost percentage? Set a target alongside menu mix, selling prices, labor and occupancy costs. Compare actual consumption cost with a recipe-based expectation using the same sales period and definitions.
What is the difference between theoretical and actual food cost percentage? Theoretical food cost % is what food cost should be based on recipes and standard portion sizes, with no waste, no over-portioning, and no supplier price surprises. Actual food cost % is what the accounting system reports after real purchases, real receiving, and a real inventory count. The gap between them reveals where procurement and kitchen discipline are leaking money.