Plate costing: work it out from the recipe, not from a hunch

Most restaurant owners know their total revenue to the pound. Far fewer know what they make on a single dish. The result is familiar: a room full every night, and a bank balance that never moves.

The cause is usually not weak sales. It is that pricing was set by feel — a glance at the competitor, a rough margin on top, and on with the day. And when supplier prices rise, which they always do, nothing in the system tells you that one particular dish has quietly started losing money.

Here is how to cost a plate properly.

Step 1: the real unit price

Start from the invoice, not from memory. Every ingredient needs three numbers:

It looks obvious, but the common mistake here is mixing units of measure. You buy oil by the litre and use it by the millilitre; you buy spice by the kilo and use it by the gram. A recipe that mixes the two can be wrong by a factor of a thousand.

Pick one base unit per ingredient — grams for dry goods, millilitres for liquids, pieces for counted items — and make every recipe speak it.

Step 2: yield

This is where most of the margin disappears.

The kilo that enters your kitchen is not the kilo that reaches the plate. A whole chicken loses weight in cleaning and boning, tomatoes lose weight in dicing, beef loses weight in cooking.

Yield = usable weight ÷ as-purchased weight.

Rough figures seen in most kitchens:

The working formula:

effective unit cost = purchase unit price ÷ yield

Buy whole chicken at EGP 75/kg with a 42% yield on boneless breast, and the kilo you actually put on the plate costs you:

75 ÷ 0.42 = EGP 178.6 per kg

Anyone costing at 75 thinks the margin is excellent. Sometimes they are selling at a loss.

Step 3: write the recipe in quantities

For every menu item, record the quantities the kitchen actually uses — not the idealised ones in your head.

A chicken shawarma sandwich:

Note the packaging line. Paper, bags and plastic cutlery are not “general overhead” — they belong to the plate, and in a delivery-heavy restaurant they are a material number.

Step 4: from cost to price

Once you know the cost, the price becomes arithmetic rather than instinct:

sell price = plate cost ÷ target food cost percentage

At EGP 32.18 with a 30% target:

32.18 ÷ 0.30 = EGP 107.3

Then round to something the market reads as sensible — 109 or 110.

If the market will not carry that price, you have exactly three moves: cut the gram weight, renegotiate the ingredient, or redesign the dish. Selling below cost and hoping to “make it up on volume” is the fastest way to close a busy restaurant.

Step 5: keep the numbers alive

A recipe costed once in a spreadsheet is wrong within weeks, because supplier prices do not hold still.

The fix is to stop costing by hand. In GoSufra a recipe is linked to the real inventory items, so three things happen automatically on every sale:

1. Ingredient quantities come off the branch’s stock.
2. The plate cost is recalculated from the latest purchase prices.
3. Margin per item shows up in menu performance reporting.

And because a recipe is written per size, you avoid the classic error of assuming a large is “double” a small — it is usually less than double on the main ingredient and more than double on packaging.

Mistakes that keep recurring

• Ignoring operational waste. Burned plates, cancelled orders and staff tasting are real costs. Log them instead of letting them vanish into stocktake variance.
• Forgetting free extras. Every “on the house” sauce has a cost, and the monthly total surprises people.
• Pricing by imitation. Your competitor’s cost is not your cost: different supplier, different contract, different volume, different yield.
• Reviewing once a year. Review your ten best sellers monthly and everything else quarterly.

A short execution list

1. List your ingredients and take unit prices off the latest invoice.
2. Set a realistic yield for anything trimmed or cooked.
3. Write a recipe for every item — and every size.
4. Put packaging inside the recipe.
5. Price from your target cost percentage, then sanity-check against the market.
6. Review the top ten sellers every month.

Start with ten items — your best sellers. You will probably find that two of them lose money, and that one of them could have been priced higher without a single complaint.