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Kitchen cost %

post #1 of 5
Thread Starter 

Was just wondering how much percent your restaurant spends weekly on:

 

Food cost:

Kitchen wage cost:

 

And how much money you make on sales of food items weekly?

 

What would your preferred percentages be and how do you keep your numbers tight so the bosses are happy.

 

Discuss

post #2 of 5

The general rule of thumb is:

- 30% food cost

- 30% labor 

- 30% overhead (rent/utilities, etc.)

- 10% profit

 

Of course, in running a kitchen you want to try and minimize these percentages as much as possible.  

post #3 of 5

*except profit :)

post #4 of 5

Remember, cost percentages are a management tool, nothing more, nothing less.

 

In hindsight, a majority of successful restaurants exhibit the 30-30-30-10 guideline, then again, there are not just aq few that deviate, some fairly widely.

 

Is a 45% food cost bad or a 20% food cost good? Not necessarily! It depends upon the specific venue, menu, market, etc.

 

Once management establishes a target percentage, there are numerous ways to meet the target:

  • Cut waste
  • Change buying sources
  • Portion control
  • Menu management
  • and many others

 

Remember, as food cost fluctuates, so does labor. Overhead (rent, utilities, insurance, etc.), on the other hand, varies very little, whether there are sales or not.

 

IMHO, food cost + labor cost = cost of sales. Sales-cost of sales = gross profit. Gross profit - overhead = net profit.

Chef,
Specialties: MasterCook/RecipeFox; Culinary logistics; Personal Chef; Small restaurant owner; Caterer
Reply
Chef,
Specialties: MasterCook/RecipeFox; Culinary logistics; Personal Chef; Small restaurant owner; Caterer
Reply
post #5 of 5

The place I'm currently at is pretty bad, with a food cost around 42%, but the liquor cost is 24% and it's primarily a bar. I keep labor around 28%. I wish I could keep food cost lower, but I'm pinching pennies and keeping the smallest inventory possible. Sometimes you just need to raise prices or change menu items.

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