Why your food cost is higher than your recipe costing says

A menu can look profitable on paper while the kitchen uses more food than the costing allows. Before raising prices or asking the chef to cut portions, check whether the recipe calculation and the actual food-cost report are measuring the same thing.

A supplier price increase is one possible cause. So is a recipe that assumes a better yield than the kitchen achieves, a case entered as a single pack, or a closing stock count that misses food in a second store. Each needs a different correction.

Start with a fair comparison

Theoretical food cost is the cost of the recipes required for the dishes actually sold. Use current recipe costs and the quantities sold for the period. Averaging the food-cost percentages printed on your recipe sheets will not give you a reliable figure for the whole menu: guests do not buy every dish in equal quantities.

A basic calculation of actual food usage is opening stock plus net purchases and transfers in, less transfers out and closing stock. Use consistent units and valuation, and account for returns and credits. Match those records to the same reporting period as sales.

To compare percentages, divide each cost total by food sales for that period. Use the same agreed treatment of discounts and taxes in both calculations.

Actual usage can include food that never appears in a customer sale. Keep waste, staff meals, complimentary dishes and other authorised consumption visible when explaining the difference. Do not deduct the same item twice or quietly adjust the stock figure to make the reports agree.

1. Check what the ingredient really yields

A recipe may price a portion of trimmed fish against the purchase price of a whole fish. The calculation needs to allow for the usable quantity after preparation. Cooking loss also matters if the portion is specified by cooked weight.

Follow one ingredient from receipt to finished portion. Weigh it at the relevant stages and record the specification, preparation method and batch. Repeat when the product or method changes. Keep raw and cooked weights clearly identified so a yield allowance is not applied twice.

The resulting figure should describe the food your team actually prepares. A yield copied from a different cut, supplier specification or preparation method can give a misleading portion cost.

For example, an ingredient purchased at AED 60 per kilogram with a usable yield of 55% costs about AED 109 per usable kilogram, before allowing for any separately valued by-products. Divide the purchase cost by the usable yield expressed as a decimal. Apply the result to the quantity the recipe actually uses.

2. Read the pack size as carefully as the price

Check the supplier's selling unit against the unit in the ingredient record. A case containing several packs needs the right total quantity; a smaller replacement pack needs a new conversion even if its name is unchanged.

For drained products, establish whether the recipe uses net or drained weight. Keep weight and volume separate unless you have a suitable conversion for that ingredient. A price update is incomplete if the pack description and usable quantity remain wrong.

3. Test the stock count before judging the kitchen

Use a count sheet that follows the physical stores, including prep fridges, pastry, satellite stations and goods awaiting an agreed disposition. Define how opened packs and prepared batches are counted and valued.

An understated closing stock figure makes calculated usage look higher. Double-counted stock has the opposite effect. Check deliveries and transfers around the cut-off, and make sure ingredients already included in prepared batches are not counted again as raw stock.

4. Give waste a useful description

“Kitchen waste” is too broad to guide a decision. Separate spoiled stock, preparation loss, overproduction, mistakes and returned dishes. Record the item, quantity, reason and stage where the loss occurred.

Normal preparation loss may already be allowed for in a recipe yield. Distinguish that allowance from additional loss when reconciling the figures. Otherwise, the same trim can appear both in the expected recipe cost and as an unexplained variance.

5. Include staff meals and other food without a sale

Staff meals use purchased food even when they are planned and authorised. Record what was prepared, in usable quantities, and apply the agreed costing method. Treat tastings, complimentary dishes and transfers consistently too.

The purpose is to explain consumption. A meal that management has approved should not disappear into a figure later described as missing stock.

Fix the largest supported cause first

Begin with high-use or high-value ingredients and dishes where the records disagree. Compare the documented recipe with portions served, sauces, garnish and substitutions. Then correct the price, yield, count routine or operating practice that the evidence points to.

Cost sauces, dressings and other prepared components as batches, using their usable output, then include the quantity used in each dish. Check that sales records capture relevant extras and modifications too. Missing a component from either the recipe or the sales record distorts the comparison.

Portion differences need the same care. Serving 200 g of an ingredient instead of the costed 180 g increases that ingredient's cost by about 11.1%. The increase in the whole dish's cost depends on the other components. Weigh portions during service before drawing a conclusion.

Review a comparable period after the change. Keep an eye on sales mix as well as cost: a different mix of dishes can change the overall percentage. Recipe costing helps you make menu decisions, but labour, overheads and service capacity still matter to the business's profitability.