Food cost
Food cost per dish: what each portion costs you.
Food cost is the share of a dish's selling price that goes on ingredients. The formula: food cost % = ingredient cost per portion / selling price excl. VAT x 100. A portion that costs you 3.17 EUR and sells for 12.50 EUR excl. VAT has a food cost of 25.4%.
How to calculate the food cost of a dish
You need the dish's recipe and the ingredient purchase prices excluding VAT. Then it takes four steps:
- For each ingredient in the recipe, multiply the gross quantity by the purchase price. Gross is what leaves the storeroom, including the waste from cleaning and cooking.
- Add up the cost of all ingredients. That is the ingredient cost per portion.
- Divide the menu price by 1.13 for food and desserts or by 1.25 for drinks. That is the selling price excluding VAT (VAT Act, Zakon o PDV-u, Article 38).
- Divide the ingredient cost per portion by the selling price excluding VAT and multiply by 100. That is the dish's food cost.
Why the price excluding VAT
VAT is not the venue's revenue. Divide the cost by the price including VAT and the food cost comes out lower and the dish looks more profitable than it really is. For a single dish the quickest way is the food cost calculator.
Food cost and margin
Margin is what is left of the price excluding VAT once you subtract the ingredient cost per portion. Food cost and margin as percentages always add up to 100%. The dish above has a food cost of 25.4% and a margin of 74.6% of the price excluding VAT, or 9.33 EUR per portion.
The margin pays for labour, rent and utilities, and what remains is profit. So a dish with a low food cost that rarely sells can bring in less than a dish with a higher food cost that sells every day.
No accurate recipe, no accurate food cost
Food cost is only as accurate as the recipe behind it. If the recipe says 180 grams of pasta and the kitchen serves 220, the portion costs you more than the calculation shows.
You need the recipe anyway: the Croatian Hospitality Act (Zakon o ugostiteljskoj djelatnosti) requires one for every dish, drink and beverage, kept in the venue during opening hours (Article 10(1)(4)).
Work it out yourself
For a single dish, these tools are enough:
- Food cost calculator: enter the ingredients and the menu price, get the food cost and margin.
- Menu price calculator: enter the portion cost and the food cost you want, get the price excluding and including VAT.
- Recipe costing template: Excel and PDF with formulas for gross quantity, cost and food cost, sent to your inbox.
Up to 3 percentage points
lower food cost in the first three months
A new ingredient price shows in every dish's margin right away
90%
less time recalculating food cost
How Patrono does it
See how much you earn on each dish.
Patrono shows the real cost and margin of every dish and keeps that number current as prices change. So you decide on the menu by the numbers, not by feel: what to push, what to reprice, what to cut.
Real cost, not an estimate
Every dish has a recipe with gram weights. The portion cost is calculated from those weights and the ingredient purchase prices, so it is a calculation, not an estimate.
Margin follows prices
When purchase prices rise or fall, the margin of every dish updates on its own, without waiting for month end.
Which dish carries, which drags
Margin by category and per dish. You see at once which dishes hold your profit and which are time to rework or cut.
Dishes above target
Every week the Overview shows how many dishes run a food cost above the 30% target. For each dish the suggested price shows in green or red, so you see at once which dish needs a new price or a word with the kitchen.
Typical scenarios
Brunch venue
Avocado, salmon and berries change price often. Patrono tracks cost per portion, so each week you know which dishes still earn.
Restaurant with catering
Events have different recipes than the regular menu. Patrono runs both separately and measures event profit on its own.
Multi-venue network
Two venues with the same menu can run a few percentage points apart in food cost. Patrono shows where: sourcing or control during shifts.
Food cost questions
Is food cost calculated on the price with or without VAT?
Without VAT. VAT is not the venue's revenue, so divide the menu price by 1.13 for food and desserts or by 1.25 for drinks (VAT Act, Article 38). Take ingredient purchase prices excluding VAT as well.
What is the difference between food cost and margin?
Food cost is the ingredients' share of the price excluding VAT, and margin is what is left. Together they make 100%: at a food cost of 25.4% the margin is 74.6% of the price excluding VAT.
Do I need a recipe for food cost?
Yes. Without a recipe you do not know how much of each ingredient goes into a portion, so you do not know what the portion costs. The Croatian Hospitality Act also requires a recipe for every dish, drink and beverage (Article 10(1)(4)).
How does Patrono calculate food cost?
Food cost is calculated from the recipes you defined, not from estimates: the gram weight of each ingredient and its purchase price give the portion cost. When you enter a new purchase price, the cost and margin of every dish that uses that ingredient are recalculated at once.
Do I have to sign a yearly contract?
No. The monthly option has no commitment. You cancel any time with full data export in machine-readable format. The annual option is a choice if you want a fixed cost, one month free versus paying monthly, not a forced condition.
Related guides
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