How do you determine the selling price of a dish using a recipe cost card? (2024)

A recipe cost card is a standard format for recording the cost of a recipe, typically containing the recipe name and number, portion size and number of portions, ingredients, quantities, and unit costs, total cost of ingredients, food cost percentage, and selling price per portion. This tool helps you track ingredient costs, measure portions accurately, and calculate the food cost percentage and selling price of a dish. You can create and update your recipe cost cards with a spreadsheet or software program.

To determine the selling price of a dish using a recipe cost card, the first step is to calculate the total cost of ingredients. This is done by multiplying the quantity of each ingredient by its unit cost and then adding up the results. For example, when making a chicken curry for four portions, if you need 1 kg of chicken, 200 g of onions, 100 g of tomatoes, 50 g of spices, and 200 ml of coconut milk, and the respective unit costs are $10 per kg, $1 per kg, $2 per kg, $20 per kg, and $3 per liter, then the total cost of ingredients would be $10 for the chicken plus $0.2 for onions plus $0.2 for tomatoes plus $1 for spices plus $0.6 for coconut milk, equaling a total cost of ingredients of $12.

The second step to determine the selling price of a dish using a recipe cost card is to calculate the food cost percentage. The food cost percentage is the ratio of the total cost of ingredients to the selling price of a dish, expressed as a percentage. It indicates how much of your revenue goes to pay for the food. The lower the food cost percentage, the higher the profit margin. To calculate the food cost percentage, you need to divide the total cost of ingredients by the selling price of a dish and multiply by 100. For example, if you sell the chicken curry for $20 per portion, the food cost percentage is:

- Food cost percentage = ($12 / $20) x 100 = 60%

The final step to determine the selling price of a dish using a recipe cost card is to apply a simple formula. This formula involves the total cost of ingredients and the desired food cost percentage. Specifically, you need to divide the total cost of ingredients by the desired food cost percentage. To illustrate, if you want to achieve a food cost percentage of 30% for the chicken curry, then the selling price per portion is $12 divided by 0.3, which equals $40.

Once you have calculated the selling price of a dish using a recipe cost card, you may need to adjust it according to the market conditions, the competition, and the customer demand. Strategies to increase or decrease the selling price could include offering discounts, coupons, or specials; bundling dishes with other items or services; changing the portion size or presentation; adding value or quality to the dish; comparing prices with competitors; and conducting market research and customer feedback. Regularly monitoring sales and profitability of dishes is recommended, so that you can update your recipe cost cards accordingly.

A recipe cost card is a useful tool to determine the selling price of a dish, but it is not enough to guarantee success in your food business. To use a recipe cost card effectively, you should review your ingredient costs and suppliers regularly, measure and weigh ingredients accurately, and train staff to follow recipes and portion sizes consistently. Additionally, you should control your inventory and reduce waste, analyze your menu to identify best and worst sellers, and test and modify recipes and prices as needed.

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Culinary Management

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