Every business must be able to keep a record of how much comes in and how much goes out. To be able to use the food cost formula excel spreadsheet, read through this article carefully.
Unsure of how to set the prices on your menu? Determine exactly how much you are spending on the ingredients to prepare each menu item as a first step.
If you don’t go through this crucial procedure, you can be losing money on each sale. And losing money is never long-term beneficial for a corporation.
Your business’s success is based on how much food you can afford. If you overcharge, customers will leave.
If you undercharge, you won’t be able to cover your expenses and keep the business running. Setting the proper food cost formula excel spreadsheet will enable you to balance the two objectives.
Not to worry. With a meal and food cost calculator that you can download and use in an Excel spreadsheet, we’re here to help you with this difficulty.
Furthermore, you won’t be performing any challenging mathematical computations. This is handled for you by the food cost calculator tool.
Use this simple recipe cost template to make sure every dish you serve is profitable. Let’s get started.
Food Cost Formula Template
You can choose from this recipe cost template in Excel or Google Docs because it is available on both online and offline platforms:
- Menu and food cost formula excel Spreadsheet (.xlsx file)
- Google Docs Spreadsheet
These spreadsheets include a template with all the information required to compute your food cost.
Simply enter the required information, including the specifics of the original recipe, the desired number of servings, the ingredients, and the meal’s original cost.
The template will determine how much it will cost to make the recipe and how much you must charge to earn a profit.
In order to calculate the suggested menu price that can be paid to guests, the program will multiply your food cost by three.
More information on setting your menu price is provided below, however, the industry accepts a 3x markup as the norm for menu items. However, there are some subtleties to this, as we’ll describe below.
You may calculate the overall cost of the recipe, the cost per serving, and the suggested retail price for the recipe by filling out each field in the spreadsheet.
How to Use the Food Cost Formula Template
Below are some steps on how to use the recipe cost template:
Step 1: Input the Original Recipe Data
In the top right corner of the template, write the name of your recipe. Start by entering the necessary information in the section labeled “original recipe.”
Enter the number of servings the original recipe may make as well as the overall yield (in ounces).
Enter the desired serving size in the box to the right. The “scale factor” will then be calculated automatically.
Step 2: List Down the Ingredients
Make a list of all the components your dish requires. Don’t overlook even the smallest aspect, like seasonings.
In our template, you may enter a total of 27 ingredients. Simply add rows to the spreadsheet if you want to add more.
Step 3: Input Bulk Size and Bulk Cost
Enter the ingredient’s bulk weight in ounces, followed by the ingredient’s price. The template will automatically calculate the “Cost per Ounce” once you provide the information for these two.
Step 4: Enter the Data for Recipe Amount
For each ingredient, enter the “Recipe Amount” field. The amount called for in your original, unscaled recipe is this.
Both the scaled amount and the ingredient’s cost are determined automatically, as you’ll discover.
This will show you your Total Recipe Cost and the Total Cost per Serving once you have entered the information for each component.
Additionally, the template displays a suggested retail price, which is calculated by multiplying your cost per serving by 3.
This is due to the fact that the cost of your raw ingredients is roughly 1/3 or 33% of your selling price.
The number of servings you get when you follow a recipe can occasionally be different. For instance, you can only get 20 portions of clam chowder if you produce enough for 24.
No need to worry though, as our template can change the pricing of the food for you.
Enter the information you have in the field at the top of the template that says “Number of servings obtained.”
Enter 20 in this example. Once you’ve done so, you’ll see the updated suggested retail price as well as the revised cost per serving.
Money Savings Recipe Collections and Tips
There are numerous strategies to reduce the price of your food. You can use the advice that follows:
Make it a habit to occasionally visit various marketplaces and food stores. On your first grocery run, if you only visit one store, you might not find any other places with lower costs.
Do your homework and compare pricing at several retailers. You can choose where to get your goods if you are aware of which products are more affordable in a particular retailer.
Buy in Season
Fruits and vegetables will cost less and be more readily available if you purchase them while they are in season.
But be mindful of how ripe you choose your fresh fruit to be. Select produce that will also ripen in a few days if you plan to use it in a few more days.
Check Out What’s on Sale
Always keep an eye out for the vegetable sales lanes. You can save money thanks to the discounted prices.
Choosing things that are on sale, nevertheless, requires caution. However, use caution because certain items that are on sale may be approaching their expiration dates.
However, it’s acceptable if you intend to use the products before they go bad. You’ll have to worry less about rotting if you can stock up on supplies like canned food or seasoning.
Buying From Direct Suppliers or Sellers
You might pay a different price if you purchase from direct vendors versus supermarket retailers. They’re also reduced, which can enable you to save money.
Additionally, you can develop a partnership with them and take advantage of exceptional prices and potential bonuses.
Buy in Bulk
You can save money by purchasing materials in bulk, especially quickly moving products. Sellers typically charge a separate and lower price for them.
You might say, “Oh, it’s only a few cents off,” but when you add up your annual savings, there is a significant difference.
For instance, depending on your scale, saving ten cents on an ingredient you use every day could result in annual savings of thousands of dollars.
How Much Should you Charge for Food?
How much you should charge for meals is a complex question with no single right solution. According to conventional opinion, your food expenses shouldn’t be higher than 33%.
It is assumed that this still leaves enough room with the 66% to pay for additional costs like labor and a lease.
But in the actual world, this 33% food expense rule is frequently broken. Consider a shaved ice shop that spends 25 cents on food costs but charges customers $3 or more for the cup.
In this straightforward scenario, the cost of food would only be 8.33%. Using the food cost formula excel spreadsheet has always been a way out.
It’s absolutely OK because the market will accept this price, which exceeds the cost of food by more than 33%.
The vendor of shaved ice would need to sell a lot of shaved ice in order to make a profit if the menu price was reduced to $1 per cup.
From a business standpoint, you will be more profitable with a higher profit margin. But you also need to think about how much the market will pay for a certain food item.
A $25 gourmet hotdog made with top-quality ingredients will appeal to some customers. But at that price, you wouldn’t be able to sell a product to the general public.
Most consumers would deem this to be too expensive. When choosing the price for your menu, keep the following factors in mind:
Gross Profit Margin
Knowing your gross profit margin enables you to determine how to achieve a desired net profit. Food prices are insufficient.
You must consider your labor costs as well. Therefore, be aware of your gross profit margin and then contrast it with your food expenses.
Check with your competitors sometimes to see if your pricing range can compete with them. It’s not a good idea to set your prices significantly below or above theirs.
However, it also depends on whether you run a formal or informal restaurant. In order to better comprehend your price structure, be aware of your rivals.
Are you eager to launch your own company? This article on food cost formula excel is intended to assist you in launching a restaurant, catering service, or food truck.
By the way, don’t forget to join a free community with reasonable subscribers if you’re beginning a food business.
Each week, you will be given new food business case studies with revenue figures.