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Costs of a Food service Operation

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Costs of a Food service Operation. Expenses. Labor Total cost of labor employed in the establishment. Expenses. Overhead Controllable Expenses Food, Labor, Supplies Non Controllable Expenses Rent, Utilities, Advertising, Insurance. Expenses. Food Cost - PowerPoint PPT Presentation

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  • Costs of a Food service Operation

  • ExpensesLabor Total cost of labor employed in the establishment.

  • ExpensesOverheadControllable ExpensesFood, Labor, SuppliesNon Controllable ExpensesRent, Utilities, Advertising, Insurance

  • ExpensesFood CostTo control Food cost, standards must be implementedQualityQuantityPortion sizeYield

    The most important standards are the recipes

  • Standardizing RecipesRecipe NameID numberPortion SizeYieldIngredientsWaste %Edible ProductAs PurchasedConversion MeasureIngredient costSubtotal costQ FactorTotal CostAdditional CostFood cost %

  • YieldThe number of servings that one preparation of the recipe produces. Yield determines portion costFor ExampleRecipe Cost = 12.90Yield = 1012.90 / 10 = $1.29 portion cost

  • Sample SOUPRecipe Yield 2 gallonsServing size 8 oz

    What is the yield?

  • Food Cost Expressed as a percentageCost of food divided by sales priceCost of food = $2.00Sales Price = $6.00Food cost = 33%

  • ExampleChicken Parm$9.998 oz chicken breast1.502 oz sauce.251 slice cheese.4012 oz pasta.55Fresh basil (garnish).05What is the food cost???

  • Determining Sales PriceDesired food cost %Direct competitionLabor intensityDemand (popularity)

  • Formulas to knowEP/AP = YIELDEP = Starting weight wasteFood cost % = cost of product / sales price

  • Portion Cost ExampleClam Chowder costs $22.00 per gallon to make. There are 16 servings at 8 oz per serving.What is the cost of 1 serving?

  • Determining Food Cost by Desired food cost %Chicken Parm costs $2.00 to make. Your desired food cost % is 30%. How much should you sell this for?

  • Waste exampleYou have a 50 lb bag of carrots. After peeling and trimming you have 5 lbs of waste. What is the Formula for finding waste percentage?


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