How to Calculate Food Cost Percentage (and Fix It When It Slips)

Food cost percentage is what you consumed divided by what you sold:

(Opening stock + Purchases − Closing stock) ÷ Food sales × 100

So if you opened the week with ₹80,000 of stock, bought ₹2,20,000, closed with ₹70,000, and sold ₹7,50,000 of food:

(80,000 + 2,20,000 − 70,000) ÷ 7,50,000 × 100 = 30.7%

Two rules make this number honest. Use food sales only, not total sales with liquor in it. And take stock at the same time on the same day each week, or you are comparing different things.

It varies by format, and anyone quoting you a single universal figure has not run a kitchen:

• QSR and fast food: roughly 25% to 30%
• Casual dine-in: roughly 28% to 35%
• Fine dining: often 32% to 38%, carried by higher prices elsewhere
• Cloud kitchen: aim lower, near 25% to 30%, because aggregator commission eats the rest
• Bars: food can run high when liquor margin covers it

The absolute number matters less than the direction. A steady 33% is a healthier business than a 28% that was 24% three months ago.

This is the comparison that actually finds the problem. Theoretical food cost is what your recipes say you should have used for the dishes you sold. Actual is what left the store.

The gap between them is your loss, and it comes from exactly four places:

• Over-portioning. The recipe says 180g, the cook serves 210g.
• Wastage and spoilage. Stock that expired or got burnt.
• Theft. Nobody wants to say it, but it happens.
• Unbilled food. Staff meals, comps and friendly discounts that never hit the till.

You cannot run this comparison without recipes attached to menu items. That is the whole argument for recipe-level inventory tracking — it turns a vague 4% gap into a named ingredient on a named dish.

• Supplier prices moved and nobody noticed. Fix: track purchase rates per item per supplier and review monthly. Onion and tomato alone can swing your whole number.
• Portions have drifted. Fix: recipes in grams, a scale on the line, and a spot check every week.
• Your menu mix shifted. Fix: if guests moved toward your low-margin dishes, that is a menu design problem, not a kitchen one. Re-read your menu engineering before blaming the chef.
• Prices have not moved in two years. Fix: a 5% price rise on your top ten sellers usually goes unnoticed and does more for margin than any cost cutting.

A monthly food cost tells you about a problem thirty days after it started. By then you have lost a month of margin and the trail has gone cold.

Weekly, you catch it while you can still name the shift it happened on. It only takes a proper stock count once a week, and if your billing and inventory are in the same system, most of it is already counted for you.

Billing Rasoi runs theoretical against actual on its own, because every bill already knows its recipe. You get the gap per item, per outlet, per week. See how the inventory module works, or start a free trial and run it on your own numbers first.