What is cost price?
The cost price (known in French as coût de revient) of a dish is the total cost of all ingredients needed to make it. In professional kitchens, it is expressed both in euros per portion and as a percentage of the selling price — the latter is called the food cost ratio.
⚡ A well-managed restaurant keeps its food cost ratio between 25% and 35% of the selling price. Above 40%, margins become critical and threaten the viability of the business.
The key formulas
Two complementary indicators are essential:
The markup coefficient is widely used in professional French kitchens. A coefficient of 3.5 equals a food cost ratio of 28.6%. In practice, chefs often set their selling price by multiplying the ingredient cost directly by the target coefficient.
Worked example: Sirloin steak with shallots
Let's calculate the cost price of a sirloin steak — a classic brasserie dish — for one portion.
| Ingredient | Quantity | Price/kg | Cost |
|---|---|---|---|
| Sirloin steak (raw) | 0.220 kg | € 22.00 | € 4.84 |
| Shallots | 0.080 kg | € 3.50 | € 0.28 |
| Butter | 0.025 kg | € 9.50 | € 0.24 |
| Red wine (for sauce) | 0.080 L | € 4.00 | € 0.32 |
| Veal stock | 0.050 L | € 6.00 | € 0.30 |
| Chips (portion) | 0.180 kg | € 1.20 | € 0.22 |
| Oil, salt, pepper, herbs | to taste | — | € 0.15 |
| Total ingredient cost | € 6.35 | ||
With a selling price of € 22.00 excl. VAT:
✅ A food cost ratio of 28.9% is excellent for a steak. There is enough margin left to cover fixed costs (rent, staff, energy) and generate profit.
How to set the selling price from ingredient cost
The simplest approach is to define your target coefficient based on your cost structure, then apply it:
Or reasoning in terms of a target food cost ratio:
Yield: the mistake you cannot afford to make
One of the most frequent mistakes is calculating ingredient cost without accounting for yield. Every raw product loses a portion of its weight during preparation:
- Meat: 20–30% cooking loss depending on the cut
- Whole fish: 50–60% loss when filleting
- Vegetables: 15–30% depending on trimming
- Whole shellfish: 60–70% waste
📐 Real net cost: if you buy a whole salmon at € 12/kg with a 40% fillet yield, the real cost of the usable fillet is € 12 ÷ 0.40 = € 30/kg.
The 5 classic cost price mistakes
1. Not updating purchase prices
Supplier prices change — sometimes significantly for seasonal products. A cost price calculated in January using October prices may be completely wrong. Update your recipe cards whenever there is a significant price change.
2. Forgetting condiments and garnishes
Salt, pepper, olive oil, fresh herbs, lemon, base sauces — negligible individually, but they represent 3–5% of total ingredient cost across hundreds of covers. Add a flat-rate "seasoning" line to every recipe.
3. Confusing recipe quantity and portion quantity
Always verify that your quantities correspond to one portion, not the whole recipe. A risotto for 4 at € 15.44 ingredient cost is € 3.86 per portion — not € 15.44.
4. Ignoring the gap between theoretical and actual
Theft, incorrect portion sizes, kitchen waste — the gap between theoretical and actual food cost typically represents 2–4% of revenue. Compare the two values regularly to spot inefficiencies.
5. Not embedding recipe cards in training
A recipe card is only useful if the brigade follows it. Uncontrolled portions or improvised recipes during service can cause the actual food cost to far exceed the theoretical figure.
Theoretical vs actual cost price
Comparing these two indicators is essential:
A gap of more than 3–5% between theoretical and actual signals a problem: waste, inconsistent portions, theft or accounting errors.
The essential tool: the recipe card
The recipe card is the reference document for every dish. It contains:
- All ingredients with their exact gramme weights
- The yield of each product
- Unit cost and total portion cost
- Target selling price and corresponding coefficient
- Standardised preparation method
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Summary: the key steps
- List all ingredients with exact gramme weights per portion
- Collect current purchase prices from your suppliers
- Calculate yields (cooking loss / trimming) for each product
- Apply: Ingredient cost = Σ (net quantity × net price)
- Divide by the selling price excl. VAT → food cost ratio
- Compare theoretical and actual ratio every month
✅ Golden rule: your target coefficient must at minimum cover staff costs (≈ 30–35%) + fixed overheads (≈ 15–20%) + desired profit. For most restaurants, a coefficient of 3× to 4× (ratio 25–33%) is the target.