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Unread 09-06-2013, 02:52 PM   #37
marubozo
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Quote:
Originally Posted by HBMTN View Post
I have read is that the food cost (food ingredients only) should be 25-33% of the cost of the meal and cost x 3 gets you in the ball park. If this is incorrect or an outdated formula, is there another that you all use that is better?
The 3x or 25-33% food cost formula is a baseline number to ensure you're profitable, not how you come up with your maximum sale price. If you can keep food costs at around 30% or lower, you're almost sure to make money at the end of the day. But that in no way should be used as a cap for how much you charge. You should charge what the market will pay.

Now if your market can only sustain a $5 sandwich, then that's what you should charge. But without testing, or knowing the market, who knows, maybe you could sell just as many at 6 or 7?
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