How can you best cost a menu?

Costing a menu is one of the toughest parts of being a chef or running a restaurant. Cooking amazing food or knowing wine combinations might come naturally to you, but costing a menu properly takes a good understanding of the formulas you need to make money. Costing a menu takes compromise, as well as careful planning. Read on for some top tips to cost a menu effectively.


Profit margin and volume

Some food, such as fish, has a small profit margin and medium sales volumes. Other items such as beef also have a small profit margin, but a larger sales volume, making them more profitable. Vegetarian pasta or risotto dishes have a much higher profit margin, but a far lower sales volume. Ideally, your menu should cover both high volume and low profit margin food, as well as low sales volume but high profit food.

Waste

Waste adds up quickly and can see you make losses that could be avoided. When you cost a menu, imagine how to make the most of a certain ingredient.


Accounting for restaurant costs

When you start to formulate your projected profit and loss in terms of menu costing, you are initially looking at the gross profit percentages from each dish. However, you must already be thinking about what needs to be deducted to formulate your net profit. This will include rent, cleaning, staff, outlay for appliances such as fridges or commercial glass washers from retailers such as
https://www.247cateringsupplies.co.uk/bar-supplies/commercial-warewashers/commercial-glass-washers. Work these out for a weekly basis, so you can cost your menu to account for how much you need to make each week to cover all these costs.

The winning formula

Ideally, you want to make a gross profit percentage of around 60-75% on food. This golden amount should cover costs and provide an overall profit, but prevent you from skimping on ingredients. Try to negotiate better deals on quality ingredients, rather than going for lower grade but cheaper ingredients. In fact, good relations with suppliers is key to
business success.
.
Menu costing is about understanding how to calculate gross/net profit and understanding the margin/sales volumes of different dishes. It’s also about reducing waste and building good relationships with suppliers, to ensure your profits remain high without compromising on quality.
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