Accurate pricing is crucial for restaurant success. Setting prices too high risks losing customers to competitors, while pricing too low reduces profits. This article explores recipe and menu costing, including how to cost individual items, conduct yield testing, and perform cooking loss tests to ensure profitability.
Understanding these processes helps restaurant owners make informed pricing decisions. By mastering costing techniques, businesses can balance customer satisfaction with financial success, ensuring menus are both appealing and profitable.
Read Also : Guide to Proper Fish Pond Construction
Understanding Recipe and Menu Costing
A recipe provides instructions for preparing a dish, while menu costs arise when businesses adjust prices, such as printing new menus. Some prices are sticky, meaning they resist change due to these costs. This article delves into calculating standard portion costs and analyzing yields to set accurate menu prices.
Effective costing ensures restaurants remain competitive and profitable. By standardizing recipes and portions, businesses can streamline pricing processes, especially during inflation when food costs fluctuate.
A. Standard Portion Cost
1. Definition: A standard portion cost is the cost of ingredients, and sometimes labor, in a standardized recipe divided by the number of portions it yields.
2. Importance of Updates: Standard portion costs change with food cost fluctuations, requiring regular updates, especially during high inflation, to maintain accurate pricing.
3. Calculation Method: Determine the cost of each ingredient and accompaniment in the recipe. Divide the total cost by the number of portions to find the standard portion cost.
B. Costing Individual Items on a Plate
1. Plate Components: For dishes with multiple components, like bacon and eggs with toast and hash browns, calculate the cost of each item separately using the standard portion cost formula.
2. Formula Application: The formula is standard portion cost = unit cost / portions in the unit. For example, a ₦200 dozen eggs with two-egg portions yields six portions, costing ₦34 per portion.
3. Simplifying with Plate Cost: Restaurants may use a “plate cost” for standard accompaniments, simplifying pricing for daily specials or frequently changing menu items by adding main dish costs.
C. Example Calculation
1. Egg Costing: A carton of eggs costs ₦200 for a dozen. With two eggs per portion, the cost per egg is ₦17 (₦200 ÷ 12), so a two-egg portion costs ₦34 (₦17 × 2).
2. Bacon Costing: A 500g bacon package costs ₦375 and contains 20 rashers. A four-rasher portion yields five portions, costing ₦75 per portion (₦375 ÷ 5).
3. Total Plate Cost: Combining eggs (₦34) and bacon (₦75), the standard portion cost for bacon and eggs is ₦109, with additional items like toast calculated similarly.
Yield Testing for Accurate Costing
Yield testing determines the usable amount of a product after processing, such as peeling or trimming. This process is essential for accurate costing, as waste and losses increase the true cost of ingredients. By conducting yield tests, restaurants can set menu prices that reflect actual costs.
This section covers how to calculate yields, translate them into monetary units, and apply yield percentages to determine edible portion (EP) costs for precise pricing.
A. Understanding Yield
1. Definition: Yield refers to the amount of usable product after processing, like 800g of carrots from 1kg after peeling, or the number of portions from a recipe, like 24 muffins.
2. Importance of Waste: Waste, such as vegetable peels or meat trims, has a monetary value that must be included in costing to ensure accurate menu pricing.
3. Yield Testing Necessity: Regular yield testing on all ingredients and recipes ensures costing reflects actual usable amounts, accounting for losses during preparation and cooking.
B. Calculating Food Costs with Yield
1. Edible Portion Cost (EP): Divide the purchased cost per unit (APC) by the yield percentage to find the EP cost. For example, a ₦990 per pound turkey with 36% yield costs ₦275 per pound (₦990 ÷ 0.36).
2. Portion Cost Example: For a 5 oz. turkey portion, divide ₦275 by 16 to get ₦17.2 per oz., then multiply by 5 to get ₦86 per portion.
3. Cauliflower Example: A ₦129 per pound cauliflower with 60% yield costs ₦215 per pound (₦129 ÷ 0.60). A 4 oz. portion costs ₦53.75 (₦215 ÷ 16 × 4).
C. Meat Cutting Yield Test
1. Process Overview: Conduct a meat cutting yield test by trimming a wholesale cut, tracking the weight of parts like fat, gristle, and usable meat, as shown in a sample pork loin test.
2. Cost Factor Calculation: The cost factor per kg is the cost per usable kg (e.g., ₦2178) divided by the original cost per kg (₦1214), yielding 1.79 for adjustments to price changes.
3. Benefits of Testing: Yield tests ensure accurate pricing, verify wholesaler quality, compare supplier efficiency, and account for slight variations in meat cuts for reliable costing.
Read Also : Methods of Fish Fecundity Determination
Cooking Loss Test for Precise Pricing
Cooking loss tests measure shrinkage in meats, like roasts, during cooking, ensuring accurate portion costing. This process is similar to yield testing but focuses on losses post-cooking, helping restaurants set prices that reflect the true cost of cooked portions.
By understanding cooking loss, restaurants can minimize waste and ensure pricing reflects the saleable weight of dishes, maintaining profitability.
A. Cooking Loss Test Process
1. Test Parameters: Record cooking time (e.g., 2 hours 30 minutes) and temperature (e.g., 175°C) for consistency, as shown in a leg of lamb test with a 125g portion size.
2. Weight Tracking: Measure original weight, trimmed weight, cooked weight, and saleable weight after deboning, noting losses from trimming and cooking to calculate costs accurately.
3. Cost Calculations: Divide the total value (e.g., ₦2438) by the saleable weight (e.g., 1600g) to find the EP cost per kg (₦1524), then calculate portion cost (₦191 for 125g).
B. Comparing Yield and Cooking Loss Tests
1. Similarities: Both tests track weight, percentage of total weight, and cost per usable kg to ensure accurate portion costing, using similar column headings in result tables.
2. Differences: Cooking loss tests focus on post-cooking shrinkage, while yield tests account for pre-cooking trimming losses, addressing different stages of food preparation.
3. Importance of Both: Combining both tests provides a comprehensive understanding of losses, ensuring menu prices reflect the true cost of ingredients and cooking processes.
Frequently Asked Questions
1. What is recipe and menu costing?
Recipe and menu costing involves calculating the cost of ingredients and sometimes labor for a dish, divided by the number of portions, to set accurate menu prices.
2. Why is standard portion cost important?
Standard portion cost ensures pricing reflects ingredient costs, helping restaurants stay profitable and competitive, especially when food costs change due to inflation or other factors.
3. How do you calculate standard portion cost?
Divide the total cost of ingredients in a recipe by the number of portions it yields. Include costs of accompaniments and garnishes for accuracy.
4. What is yield testing?
Yield testing measures the usable amount of a product after processing, like peeling or trimming, to determine the true cost of ingredients for menu pricing.
5. How does a cooking loss test differ from a yield test?
A cooking loss test measures shrinkage during cooking, while a yield test focuses on losses from trimming or processing before cooking, addressing different preparation stages.
6. Why is a cost factor useful in meat costing?
The cost factor adjusts portion costs when wholesale prices change, ensuring accurate pricing without redoing full yield tests, saving time and maintaining profitability.
7. How can restaurants simplify costing for daily specials?
Restaurants can use a “plate cost” for standard accompaniments, adding only the main dish and specific garnish costs to streamline pricing for frequently changing items.
Do you have any questions, suggestions, or contributions? If so, please feel free to use the comment box below to share your thoughts. We also encourage you to kindly share this information with others who might benefit from it. Since we can’t reach everyone at once, we truly appreciate your help in spreading the word. Thank you so much for your support and for sharing!