How to Calculate Food Cost Percentage for Your Restaurant Menu
Published on June 30, 2026 | Food Costing | By Abdul Aziz
Food cost percentage is the single most useful number in restaurant management. Get it wrong and you either overprice your menu into a competitor's arms, or underprice it and quietly bleed margin every single day. Here is how to calculate it properly for chicken-based dishes, which usually dominate Karachi menus.
1. The Basic Formula
Food cost percentage equals (cost of ingredients for one plate divided by menu selling price) multiplied by 100. If a plate of chicken karahi costs PKR 280 in ingredients and sells for PKR 800, the food cost percentage is 35 percent. This single number tells you what portion of every rupee a customer pays goes to raw ingredients, versus labor, rent, and profit.
2. Cost the Recipe at As-Served Weight, Not Raw Weight
A common mistake is costing a dish using the raw purchase weight of chicken without accounting for trim and cooking loss. Boneless chicken breast or leg typically loses 20-25 percent of its raw weight through trimming, fat removal, and cooking shrinkage. If your recipe calls for 250g of cooked chicken per plate, you likely need to purchase around 320-330g raw to end up with that yield. Cost the recipe using this real, as-served weight.
3. Build a Recipe Card for Every Dish
Write down every ingredient with exact gram or ml quantities: chicken, oil, spices, yogurt, garnish. Multiply each by its current per-unit cost and sum the total. This recipe card becomes your reference every time your chicken wholesale rate shifts, so you can recalculate cost in minutes rather than guessing at margin.
4. Set Your Target Food Cost Percentage
Most full-service restaurants target 28-35 percent food cost, while fast food and high-volume QSR concepts aim for 25-30 percent because their labor and overhead ratios differ. Once you know your target percentage and your recipe cost, back-calculate the menu price: menu price equals ingredient cost divided by target food cost percentage. A dish costing PKR 280 with a 30 percent target should be priced at roughly PKR 933.
5. Track Food Cost Percentage Monthly
Calculate your actual overall food cost percentage monthly by dividing total food purchases for the month by total food sales revenue. If your actual percentage runs consistently higher than your recipe-card targets, the gap usually points to portion drift, waste, or theft — not supplier pricing.
6. Use a Rate-Stable Supplier to Simplify Costing
Since chicken is usually the largest single cost line on a Karachi menu, working with a supplier that publishes clear, market-linked daily rates makes recosting fast and predictable rather than a monthly surprise. See our daily wholesale chicken rate page to check current pricing when you update your recipe cards.
Need Consistent Rates to Cost Your Menu?
Fresh Poultry publishes daily market-linked wholesale rates, so you can recalculate food cost percentage accurately every time prices move.
Check Today's RateFrequently Asked Questions
Common questions about our wholesale chicken supply services in Karachi.
Food cost percentage equals the cost of ingredients for a dish divided by the menu price of that dish, multiplied by 100. For example, if a chicken karahi costs PKR 280 to make and sells for PKR 800, the food cost percentage is 35 percent.
Most full-service restaurants target a food cost percentage between 28 and 35 percent, while fast food and QSR operations often aim lower, around 25 to 30 percent, because of higher volume and lower average ticket sizes.
Use the as-served yield weight, not the raw purchase weight, by factoring in trim loss and cooking shrinkage; boneless chicken typically loses 20-25 percent of its raw weight through trimming and cooking, so that loss must be built into the per-portion cost.
Recalculate monthly at minimum, and immediately whenever your chicken wholesale rate changes significantly, since poultry is usually the single largest and most rate-volatile ingredient line on a Karachi restaurant menu.