Restaurant ManagementProfitabilityPricing Strategy
The 30% Rule: Why Most Restaurants Underprice Their Menu
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The "Phantom" Cost
A new cafe owner buys a chicken for ₹200. They cook it and sell the dish for ₹300. They think they made ₹100 profit.
They actually lost money.
Why? They forgot the "Phantom Costs":
- Wastage: Bones, skin, and trimmings (Yield Loss).
- Hidden Ingredients: Oil, spices, gas, packaging.
- Overheads: Rent, labor, electricity.
The Golden Ratio: 30% Food Cost
Successful global chains operate on a strict rule: The cost of raw ingredients should never exceed 30-35% of the selling price.
If your dish costs ₹100 to make (Ingredients only), you must sell it for ₹300 to ₹330.
- 30% = Food Cost
- 30% = Labor & Rent
- 20% = Overheads
- 20% = Your Actual Profit
Stop Guessing. Start Calculating.
Calculating yield and percentages for every dish is tedious math. That's why most owners skip it (and fail).
We built a dedicated calculator for Indian restaurateurs.
👉 Open the Menu Pricing Calculator
- List Ingredients: Add Chicken, Masala, Cream.
- Enter Cost: Input purchase price.
- Set Target: Slide to "30%".
- Get Price: The tool instantly tells you: "Sell at ₹350 to stay safe."
It also shows you a visual "Profit Pie Chart" so you can see exactly where your money goes.