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Food costing and menu pricing for restaurants

The price on your menu should start from the real cost of the dish. Here is how to work it out and keep it right.

5 min read

Start with the recipe

Write each dish’s ingredients in real quantities: 180 g of meat, 1 bun, 30 g of sauce. Estimates hide waste; precise recipes reveal it.

The cost of each ingredient

Use the average cost from your purchase bills, not just the last price. A weighted average reflects what you actually paid for what is in stock.

  • Ingredient cost = quantity × average unit cost
  • Dish cost = sum of ingredient costs + add-ons
  • Food-cost % = dish cost ÷ selling price before VAT

Price with a clear margin

Set a target cost percentage per category (drinks usually lower than mains), then price each dish to stay within it; remember Saudi menu prices include 15% VAT.

Watch for change

Ingredient prices move, so review dish costs regularly and compare the usage your recipes expect with the actual count; the gap is waste or prep mistakes.

How Banan Soft helps

Recipes in Banan Soft deduct ingredients with every sale, average cost updates with every purchase received, and cost reports show each item’s cost, stock variance and waste.

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