Author: Christine Dantz

Certified food protection managers know that keeping an eye on food costs allows for better profit margins, waste reduction and inventory control. However, many food businesses calculate their food costs by using a simple formula involving the cost of goods versus sales hoping to hit a food cost percentage somewhere in the low thirties. While this simplified system gives a good overview, many certified food protection managers benefit from delving deeper into their food cost picture. Let’s take a look at a couple of ways to get more detail into whether your food costs are hurting or helping your bottom line.

A Certified Food Managers Guide to Food Cost Control and Better Profits

Meeting food cost goals is a must for survival in the food industry. With prices rising and product shortages becoming an issue it’s more important than ever to track food costs. Rather than simply calculating expenses versus profits, there are other steps that can help certified food protection managers see where the worst offenders are for causing costs to rise. Certified food managers should:

• Evaluate the cost of each menu item
• Look for substitutes for high-priced ingredients
• Consider trimming expansive menus

It definitely will be a tedious process, but calculating the cost and profit margin on every item on your menu gives you a great picture of how you’re investing in your ingredients. You may find that you have certain items that cost way too much to produce that are throwing off your food costs. These expensive items can drain your income, so you may wish to consider raising prices or adjusting recipes to keep your menu sustainable. On the other hand, you may find that there are some items you’re practically giving away. Some certified food protection managers use these dishes to offset costs of dishes that detract from food cost goals or increase sales prices; achieving a balance between the two will help manage food costs more effectively.

When evaluating your menu, you may find some ingredients are just not sustainable when it comes to food costs and waste. There are many talented food business managers that would see more affordable, yet quality, substitutes.

You may also find that waste is high on low-volume menu items. If you’re throwing away large volumes of product, that’s going to kill food costs, so menu adjustments may be necessary.

If you don’t know how to begin calculating individual menu item food costs, we suggest you talk to your product supplier. Many significant suppliers offer software that eases the process, and many of these programs even have live cost updates so you can check week to week to see where your bottom line sits.

Have you taken the time to evaluate how you calculate food costs?