Food Cost Calculator
A food cost calculator is generally a spreadsheet or a dynamic web page that allows you to add up the cost of a dish based on the quantity of each ingredient used and the price paid for those ingredients. The purpose of using a food cost calculator is to remove the guesswork of pricing a dish and help establish a baseline food cost to then add a profit margin. In other words, to make a profit of 15% on a dish, you have to know the true cost of the dish to calculate a 15% profit. If you've been guessing the cost of a dish, your profit margin may not actually be 15%, and your financial forecasts for your business would be off.
Just to repeat the point because it's that important: you need to know the true cost of a dish before you can determine a profit margin.
For food service professionals, a food cost calculator provides another important benefit: the ability to scale. For example, if a menu consists of 20 items, then changes in the cost of ingredients used by any of those 20 menu items would require a reevaluation of the cost of those dishes. Trying to mentally tally up the cost of the 20 dishes based on updated costs of ingredients can take minutes or hours to accomplish, is error prone, and completely unnecessary. A food cost calculator can do it in a few seconds.
Get started with Cocina Digital, the only food cost calculator you need!A Food Cost Calculator Should Grow With Your Business
As previously mentioned, a food cost calculator should allow you to scale with as many menu items as you sell, and it should maintain a high level of performance in those calculations. What exactly do we mean by that? Whether you sell one menu item or 100,000 menu items, the performance and reliability of the food cost calculator should not go down as the number of dishes goes up. This is an area where an online-based food cost calculator will outperform a standalone spreadsheet: as you add more and more line items to a spreadsheet and expect it to calculate food costs using various formulas designed in the spreadsheet, the performance of the spreadsheet will eventually go down. An online-based food cost calculator, due to its distributed design in the cloud, is already built to scale as your quantity of ingredients, vendors, and menu items scale.
Get started with Cocina Digital, the only food cost calculator you need!Who Should Use a Food Cost Calculator?
Food service professionals must know how much each dish costs to price correctly for desired profit percentage. If you're in the business of selling one or more dishes, you should use a food cost calculator. This applies to professionals ranging from the part-time home cook selling cupcakes on the side, to a full scale Michelin-starred restaurant. This is critical and cannot be overstated.
If you fall into any of the following categories, you should use a food cost calculator:
caterers
chefs
food truck operators
restaurant owners
home cooks selling dishes part time or full time
school bake sales
church events involving meals
cooks preparing meals for the elderly or infirmed
families on a budget trying to keep track of how much they spend on food
cooks attempting to feed multiple guests at a family or company sponsored event and needing to plan a budget around the cost of ingredients and number of guests to be served
Conclusion
A food cost calculator is one of the most valuable tools that a food service professional or a home cook can use to keep track of the costs of the ingredients in their dishes. A food cost calculator should be intuitive to use, support a wide variety of ingredients, accommodate multiple vendors, allow quick updates to the cost of a dish based on fluctuating ingredient costs, and scale with the number of dishes offered on a menu.
Without a food cost calculator, determining the cost of a dish is just guesswork and likely to be wrong. Although this might seem more streamlined, this quickly becomes unmanageable as the number of dishes on the menu changes based on consumer dining preferences and as the cost of ingredients go up or down due to inflation, seasonality of fruits and vegetables, buying from different suppliers who have their own markups, or political events that affect regional or global supply chains.
Even if you're convinced that you don't need to use a food cost calculator because you possibly consider it overkill, simply consider the fact that if you spend some time upfront implementing a food cost calculator, you save time on the other side, you know the true cost of your dishes, you have a more reliable way to forecast your expenditures versus income, and you have the ability to replicate the process for as many dishes as you have. Time is money as they say, so why waste yours?
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