Food cost percentage is calculated as (plate cost ÷ menu price) × 100. Industry benchmarks typically range from 28–35% for casual dining, 25–30% for QSR, and 22–28% for fine dining. A food cost percentage that is too high indicates pricing pressure; one that is too low may signal underpriced items or inconsistent portioning. MenuMargin tracks this KPI per item and flags when it drifts above target, enabling operators to make evidence-based repricing decisions rather than guessing.
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Food Cost Percentage
The ratio of ingredient cost to menu price, expressed as a percentage. A key profitability benchmark.
Related terms
- Plate Cost — The total ingredient cost for a single prepared menu item, calculated from the cost per ingredient portion.
- Menu Engineering — A framework for categorizing menu items by profitability and popularity to optimize item mix and pricing.
- Prime Cost — The combined total of food and labor costs, a primary driver of restaurant profitability and operational health.