Menu Pricing Calculator

Industry average: 25% – 35%

Pricing Breakdown

Suggested Menu Price:

Gross Profit per Dish:

Markup Percentage:

Total Prime Cost:

function calculateMenuPrice() { var foodCost = parseFloat(document.getElementById('rawFoodCost').value); var targetPct = parseFloat(document.getElementById('targetPercentage').value); var labor = parseFloat(document.getElementById('addLaborCost').value) || 0; var overhead = parseFloat(document.getElementById('overheadCost').value) || 0; var resultDiv = document.getElementById('pricingResult'); if (isNaN(foodCost) || isNaN(targetPct) || foodCost <= 0 || targetPct <= 0) { alert("Please enter valid positive numbers for Food Cost and Target Percentage."); return; } // Formula: Menu Price = Food Cost / (Target Percentage / 100) var suggestedMenuPrice = foodCost / (targetPct / 100); // Adding other costs to the price is a choice, but usually, target food cost % // covers the food cost, and we want to see if that price covers labor/overhead. var totalVariableCosts = foodCost + labor + overhead; var grossProfitVal = suggestedMenuPrice – totalVariableCosts; var markupVal = ((suggestedMenuPrice – foodCost) / foodCost) * 100; document.getElementById('suggestedPrice').innerHTML = "$" + suggestedMenuPrice.toFixed(2); document.getElementById('grossProfit').innerHTML = "$" + grossProfitVal.toFixed(2); document.getElementById('markupResult').innerHTML = markupVal.toFixed(1) + "%"; document.getElementById('primeCostResult').innerHTML = "$" + totalVariableCosts.toFixed(2); resultDiv.style.display = 'block'; }

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How to Use the Menu Pricing Calculator

Setting the right price for your restaurant menu items is a balancing act between profitability and customer value. This calculator helps you determine the ideal selling price based on your raw ingredient costs and target margins.

The Importance of Food Cost Percentage

Food cost percentage represents the portion of your sales that goes toward purchasing ingredients. In the restaurant industry, most profitable establishments aim for a food cost percentage between 28% and 35%. If your percentage is too high, you won't cover your labor and rent. If it's too low, customers might feel they aren't getting value for their money.

Understanding the Formula

The standard formula used in this calculator is:

Menu Price = Raw Food Cost / Desired Food Cost %

For example, if a burger costs you $3.00 in ingredients and you want a 30% food cost, the calculation would be: 3.00 / 0.30 = $10.00.

Key Terms Explained

• Raw Food Cost: The total cost of every ingredient used to make one single portion of the dish, including garnish and oil.
• Prime Cost: The combination of your food costs and the direct labor required to prepare the item.
• Markup: The difference between the food cost and the selling price, expressed as a percentage of the cost.
• Gross Profit: The actual dollar amount left over after the cost of ingredients and direct expenses are subtracted from the selling price.

Realistic Pricing Example

Let's look at a "Classic Pasta Carbonara":

Component	Cost
Pasta & Eggs	$1.20
Guanciale/Pancetta	$2.50
Cheese & Seasoning	$0.80
Total Raw Cost	$4.50

Using a 25% target food cost, the suggested price would be $18.00. This leaves $13.50 in gross profit per plate to cover the chef's wages, the electricity for the stove, and the restaurant's lease.

Tips for Maximizing Profit

1. Monitor Waste: If your actual food cost at the end of the month is higher than your calculated cost, check for kitchen waste or over-portioning.
2. Psychological Pricing: Instead of $18.00, consider $17.95 or $17.99 to make the price point feel more accessible to customers.
3. Menu Engineering: High-profit items (low food cost, high popularity) should be highlighted on your menu using boxes or bold text.
4. Bulk Buying: Reduce your raw food cost by negotiating with suppliers for bulk discounts on non-perishables.