how do restaurants calculate the prices of each dish? Do they accurately do it or just a rough estimate?
In: Economics
I scrolled the top replies and most people in here are full of shit and conjecture. I’ve run restaurant kitchens and it is a cost pricing. You calculate the ingredients in your dish based on an average 30% food cost goal. You account for the proper yield of your ingredients and get the most accurate number per portion possible. Labor is not typically factored into each dish, but you try to keep that at 30% of total sales, so you use sales projections to inform staffing levels. Then 30% goes to overhead costs, rent, utilities, keeping the business running. If you hit these numbers you can make a 10% profit. There are some adjustments like raising the chicken price to make the steak more reasonable, and booze have a much higher profit margin with a 300% markup and next to no waste/little labor.
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