How to cost a recipe
A plain guide for New Zealand cafés, restaurants and food trucks · Updated October 2026
Knowing what each plate costs you is the difference between a busy kitchen and a profitable one. Supplier prices move every week, so a dish that made money in summer can quietly lose it by winter. Here's how to cost a recipe properly, step by step.
1. Work out the cost per gram (or ml, or each)
Start from the pack you actually buy. Divide the pack price by the pack size:
- Butter, 500 g for $6.50 → $6.50 ÷ 500 = 1.3 cents per gram
- Stock, 1 L for $3.50 → $3.50 ÷ 1,000 = 0.35 cents per ml
- Eggs, a tray of 30 for $15.00 → 50 cents each
Weigh ingredients in the recipe rather than using cups or spoons. Grams are the only way to get a reliable number.
2. Allow for trim and waste (yield)
Some of what you buy goes in the bin: onion skins, carrot tops, fish frames, fat trimmed off meat. The yield is the share you can actually use. If a 1 kg bag of onions gives you 900 g once peeled, the yield is 90%, so the real cost per usable gram is higher:
$3.00 ÷ 900 g = 0.33 cents per usable gram (not 0.30).
Weigh it once before and after prepping, write the yield down, and use it every time you cost that ingredient.
3. Add up the batch, then divide by portions
Multiply each ingredient's cost per gram by the grams in the recipe, add them up, and divide by the number of portions the batch makes. Here's a mushroom risotto that makes 4 portions (prices excluding GST):
| Ingredient | Pack price | Used | Cost |
|---|---|---|---|
| Arborio rice | $6.00 / 1 kg | 480 g | $2.88 |
| Mushrooms | $6.00 / 400 g | 400 g | $6.00 |
| Chicken stock | $3.50 / 1 L | 1,200 ml | $4.20 |
| Parmesan | $9.00 / 250 g | 80 g | $2.88 |
| Butter | $6.50 / 500 g | 60 g | $0.78 |
| Onion (90% yield) | $3.00 / 1 kg | 150 g | $0.50 |
| Batch cost | $17.24 | ||
| Cost per portion (÷ 4) | $4.31 |
Don't forget the small things: oil for cooking, garnish, sauces and sides all belong in the recipe.
4. Work out the food cost %
Food cost % is the portion cost as a share of what you charge:
Food cost % = cost per portion ÷ menu price × 100
If the risotto sells for $24 on the menu, take the GST off first if you're GST registered ($24 ÷ 1.15 = $20.87). Then $4.31 ÷ $20.87 = about 21%.
What's a good number? There's no single right answer. It depends on your style of food, your wage bill and your rent. A common rule of thumb in hospitality is to aim somewhere around 25–35%. Pick a target that suits your business and check every dish against it.
5. Set a menu price from your target
Flip the formula round to find the price that hits your target:
Menu price (ex GST) = cost per portion ÷ target %
At a 30% target the risotto would need $4.31 ÷ 0.30 = $14.37 ex GST, or about $16.50 including GST. At $24 it's comfortably under target. A dish that costs more to make, like a steak, might not be.
6. GST: compare like with like
If you're GST registered, you claim back the GST on what you buy and pay GST on what you sell. Compare ingredient costs excluding GST with your menu price excluding GST. Wholesaler price lists are usually quoted ex GST already. Supermarket shelf prices include it, so divide them by 1.15.
If you're not registered, there's no GST to claim back or charge, so use the prices you actually pay against the menu price your customers actually pay.
7. Keep it up to date
Costing a menu once isn't enough. Butter, eggs, produce and protein prices can move a lot in a few weeks. Re-cost your menu whenever a big supplier price changes, and at least every season. The dishes that use the ingredient that went up are the ones to check first.
Let PantrySum do the maths
PantrySum costs every recipe from your suppliers' prices, uses the cheapest supplier for each ingredient, handles yield and GST, and flags dishes when a price change pushes them over your target. You can import your supplier's price list from a spreadsheet, so there's no retyping.
See PantrySum, free for 14 daysThis guide is general information to help you cost recipes. It isn't accounting or tax advice. Talk to your accountant about your own business.