Food costing

©Lokendra kumar
Food costing

This is a most common and important term used in food

business to know the profitability at the end of the day/month
High food cost = less profit
Less food cost = high profit
In a food business it is very necessary to maintain the quality and quantity of food to justify the value for money paid by guest/customer. And to keep/add long-term relations with them(guest/customer).

Every organizations have their own set standard percentage of food cost & profitability and this must be followed by the chefs or food handlers to maintain the quality of food and to keep organization’s profitability
How to calculate food cost
Cost of food divided by sale of food x 100 = food cost %
It means…
If food cost of 1 dish is 500, and sale is 1500, the food cost% would be 33.3%

Basic Formula is…

Value of opening inventory
+ food purchase
= total cost value
- value of closing inventory
= value of food consumed
-Value of employee meals
= total cost of food sold
Food cost % = (total cost of food sold x 100)/total sales value
Maintaining food cost at 30-33% is ideal condition to keep
balance between quality and profitability

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