Do I have to actually cost my recipes? Is there an easy way around it?
– Abby Singh, Owner, Canteen 900, Forty Fort, PA
Costing is a pain. It is tedious work and as soon as you have finished, your numbers will be outdated due to fluctuating food prices. While the math involved in costing is fairly basic, it can be further complicated due to confusion with measurements (my recipe calls for one quart of chocolate chips but I only know the cost per pound), yields (if I need ten pounds of shredded roast chicken, how many chickens do I need to buy and cook to yield that amount?), and usable trim (how do I account for the cost savings in using those chicken bones for stock?)
Some operators handle this challenge by simply ignoring the complicated part of costing and guessing with two methods:
- Competition pricing. The guy across the street sells a large pizza for $12 and seems to be making money so I’ll sell mine for $11.99.
- Cost of center-of-plate plus. My steaks cost me six dollars each. Add a buck for potatoes and veg and let’s call it a seven dollar food cost per plate.
Both of these methods are problematic. First, you don’t know the other costs that go into your competition’s pricing. Perhaps they get a better deal from their food vendor than you do, are relying heavily on culinary school interns or family members for cheap labor, or own their building so don’t build rent expense into their pricing. In the second method, without knowing the costs of everything on the plate, you have no idea whether you are pricing to cover expenses and make a profit. Restaurant margins are already slim enough—don’t sell yourself short by underestimating your costs.
Yes, your best solution is to cost your recipes, and then, once costed, make sure they are being prepared as indicated and served at the portion size specified. I once worked with a restaurant who had their costing spreadsheets perfectly calculated but didn’t realize they were scooping their crab cakes with a four ounce rather than a three ounce scoop—because the prep cook said the bigger one worked better.
Yes, costing takes work but fortunately there are people who can help you. Restaurant software or even basic spreadsheets can make the calculations easier, and your POS system can do costing functions as well.