How to reduce restaurant food cost — a working playbook

Food cost rarely blows up in one bad week. It creeps: a supplier nudges the paneer rate, a new cook pours heavier, a fridge fails quietly over a weekend. Each is a percent or less; together they take a restaurant from a healthy 30% to a painful 38% without anyone deciding anything. The fix is not heroics — it's a loop you run weekly.

First, know your real number

Food cost % = cost of what the kitchen consumed ÷ net sales, for the same period. Not purchases ÷ sales — a big stock-up week would look like a disaster and a run-down week like genius. You need consumption, which means you need recipes: what each dish actually uses. Once recipes exist, every bill deducts stock and the consumption number computes itself.

• Healthy band for most Indian full-service formats: 28–35% of net sales
• QSR and beverage-led cafés often run lower; buffet and seafood higher
• Track the trend weekly — the direction matters more than the decimal

The four leaks, in order of size

• Portioning — the biggest and most invisible. A ladle that's 10% generous is a 10% cost rise on that dish. Fix: recipe cards with weights, spot-check the top five sellers monthly.
• Receiving — you pay for 10 kg, the crate holds 9.4. Fix: weigh at the door for your five costliest items; log rate jumps against the last purchase.
• Wastage — spoilage, over-prep, cooking errors. Fix: write off with a reason every time; review the wastage report by reason weekly. What gets named gets fixed.
• Theft and untracked use — the leak everyone suspects and nobody measures. Fix: a movement ledger where every stock change has a type and a person, so the honest answer is visible either way.

The weekly ten-minute review

One fixed slot, three screens: consumption per ₹1,000 of sales (is the trend up?), wastage by reason (what's the top reason this week?), and rate jumps by vendor (who raised prices on you?). Decide one action — retrain one portion, requote one item, fix one storage habit — and check it moved the number next week.

Price the dish, not the month

When cost does rise, the answer is rarely a blanket menu hike. Dish-level margin shows exactly which items turned thin — usually two or three — and a ₹10–20 correction on those, rounded to a clean number, recovers the margin without customers feeling a reprice.

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