how do restaurants calculate the prices of each dish? Do they accurately do it or just a rough estimate?
In: Economics
What you want to do is look at the cost for your raw ingredients, then you sort of estimate how much of each ingredient will cost in a particular dish. A rough estimate is fine, but the closer the better. Now do you have the estimate of how much it costs you to make that dish? Great. Multiply it by 3. Thats the rule of thumb.
Some (maybe all) of your dishes will have a smaller profit margin because they’ll be the ones that pull the crowd in in the first place. The idea is that you’ll make your money on volume. Some will have a wider profit margin because they won’t be ordered too much, but you still have to keep them on the menu.
This is all generally speaking. Different restaurants have different pricing strategies or will alter costs depending on popularity. But if you’re planning on opening up like a chili dog stand at your next neighborhood bazaar for shits and giggles, this is how I would determine my prices.
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