Recipes & costing
Recipe costing basics: from invoice price to plate cost
How to keep recipe costs current by connecting them to the invoices you already receive.
By 86operations · Published · 7 min read
A recipe cost is only as good as the prices behind it. If those prices were typed in once and never updated, the cost % on your menu is a guess.
The arithmetic
- Ingredient cost = quantity used × current price per unit (after converting units, such as cases to ounces).
- Recipe cost = sum of ingredient costs ÷ number of portions the recipe yields.
- Cost % = recipe cost ÷ menu price × 100.
Hypothetical example
A cocktail uses 2 oz of tequila at $0.95/oz, 1 oz of lime at $0.20/oz and 0.75 oz of syrup at $0.10/oz. Cost = $1.90 + $0.20 + $0.075 = $2.18 (rounded). At a $14 menu price, cost % = 15.5%.
Illustrative only—not a customer result.
Keep it current
- Capture every invoice (photo or PDF) in Inventory → Invoices.
- Review each line and approve it. Approved prices update the product.
- Open Recipes. Anything affected by a recent ingredient cost increase is listed at the top.
- Review those recipes: portion, price or supplier.
Recipe cost % is theoretical—what the recipe should cost. Compare it with counts, variance and waste to understand actual usage.
Common gaps
- Unit mismatches (a case vs. a bottle).
- Garnishes and oils left out.
- Yield not accounted for (trim, cooking loss).
- Waste not logged, so actual cost runs above theoretical.