ESCOR Industry Report·RECIPE-C
KnowledgeFood Costing

Recipe Costing

Recipe costing is calculating the exact cost of a dish from its ingredients, accounting for yield and waste — the foundation of pricing and food cost.

Target prime cost
55–65%
Full-service benchmark
Typical net margin
3–8%
Independent restaurants
Weekly review cadence
7 days
Recommended frequency
Margin shock
±2 pts
Can erase a month’s profit
01

Executive summary

AI-generated brief · 30-second read

Recipe costing breaks a dish into ingredients at purchase prices, adjusts for yield (usable product after trim and cooking loss), and produces a plate cost. Divide plate cost by menu price for the item's food cost %. Accurate recipe costing is the prerequisite for menu pricing, menu engineering and trustworthy theoretical food cost.

1
Lead insight
Plate cost = sum of ingredient costs, adjusted for yield.
2
Yield accounts for trim, shrinkage and cooking loss.
3
Item food cost % = plate cost ÷ menu price.
4
Re-cost when supplier prices change.
02

Key data & benchmarks

Figure 1 — Typical full-service restaurant cost structure (% of sales)

Prime cost composition

Watch this: Food + labour alone usually clear 60% of sales — miss them and net profit disappears.

32%Food cost
Food cost32%
Labour cost30%
Occupancy10%
Other opex15%
Net profit5%
Who this is for
ChefsKitchen managersCost controllersOwners
What you will learn
  • How to cost a recipe step by step
  • How yield changes true cost
  • How to derive item food cost %
  • When to re-cost
03

Analysis & recommendations

Detailed operational guidance

Cost a recipe step by step

  1. List every ingredient and the quantity used in the recipe.
  2. Convert purchase units to recipe units (e.g. RM/kg to RM/g).
  3. Apply yield to account for trim and cooking loss.
  4. Sum the adjusted ingredient costs to get the plate cost.
  5. Divide plate cost by menu price for the item food cost %.

Why yield matters

If you buy whole fish at RM40/kg but only 60% is usable after filleting, your true cost per usable kg is RM40 ÷ 0.6 = RM66.67. Ignoring yield understates plate cost and quietly inflates food cost.

Yield formula

Yield-adjusted cost = Purchase cost ÷ Yield %

Keep recipes live

Keep costed recipes in one place and re-cost when supplier prices move — otherwise your theoretical food cost drifts from reality.

Figure 2 — Prime cost % ranges by restaurant type

Cost benchmarks by concept

Takeaway: Fine dining runs hotter prime cost — you need tighter controls, not looser ones.

QSR61%
Casual dining63%
Full service65%
Fine dining67%
04

FAQ

How do you cost a recipe?

List ingredients and quantities, convert purchase prices to recipe units, adjust for yield (trim and cooking loss), sum to get plate cost, then divide plate cost by menu price for the item's food cost percentage.

What is yield in recipe costing?

Yield is the percentage of a purchased ingredient that is actually usable after trimming, cleaning and cooking. Costs must be adjusted by yield to reflect true plate cost.

05

Ask AI about this topic

Ask AI · Recipe Costing
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Ask ops questions from this guide — or sourcing questions like where to find used equipment. Answers cite ESCOR and can show supplier cards.

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ESCOR Culinary Knowledge Graph · Food CostingReport RECIPE-C · Published · escor.ai/knowledge/recipe-costing