What "food cost" actually means
Food cost is the value of the ingredients that go into the food you sell. There are two ways to look at it, and you need both:
Plate cost is what a single dish costs to make — the sum of its ingredients at today's prices. Food cost percentage is your total ingredient spend as a share of your sales over a period (we cover that in detail in a separate guide). To control either, you have to start at the plate.
Step 1: Cost every dish from its recipe
Take one menu item — say a beef burger. List everything in it: the bun, the patty, cheese, sauce, lettuce, the oil it's fried in. Now put a shilling value on each portion. A 1kg pack of mince at KES 650 making 8 patties means KES 81 of mince per burger. Do this for every ingredient and you have your plate cost.
Do it once for each menu item and you suddenly know your margins. The chips that feel cheap might cost you more than you think once oil and gas are counted. The drink that costs KES 20 and sells for KES 150 is carrying the dishes that don't.
Step 2: Track ingredients in real time, not by memory
Costing a recipe once on paper is a start, but prices in Kenya move constantly. The price of cooking oil, flour, tomatoes and meat can swing week to week. If your recipe still uses last quarter's prices, your "food cost" is fiction.
The fix is to track ingredient stock and cost as it flows through the kitchen. When you receive a delivery, record the quantity and what you paid. When a dish sells, the system deducts the exact ingredients used. Now your plate cost updates automatically the moment a supplier price changes — and you can see your real-time stock balance for every item at the same time.
Step 3: Compare what you used vs what you should have used
This is where tracking pays for itself. If your POS says you sold 40 burgers, it should have used 40 patties. If your physical stock shows 55 patties gone, 15 disappeared into waste, over-portioning, staff meals or theft. That variance is money, and you can only see it when sales and stock are linked.
Reviewing this variance daily or weekly turns vague worry ("food cost feels high") into a specific, fixable number you can act on.
Step 4: Set a target and watch for drift
Decide what food cost percentage you want each dish — and your menu overall — to run at. A common target in Kenya is 28–35% depending on the concept. Once you have a target, you can flag any dish drifting above it and fix it: adjust the portion, renegotiate the supplier, or reprice the item.
Common food-cost mistakes to avoid
Even careful owners lose money to these:
- Pricing dishes on "feel" instead of actual plate cost.
- Never updating recipe costs when supplier prices rise.
- Ignoring oil, gas, packaging and garnishes — small per-plate costs that add up fast.
- Counting stock monthly instead of tying it to daily sales, so variance hides for weeks.
- Treating staff meals and waste as free — they come straight out of margin.
Key takeaways
- Start at the plate: cost every menu item from its recipe in shillings.
- Track ingredients in real time so plate costs update automatically when supplier prices move.
- Compare ingredients used vs ingredients sold — the variance is waste, over-portioning or theft.
- Set a target food cost % per dish and flag anything that drifts above it.
How DineHQ tracks food cost automatically
- Build each dish from its recipe once — DineHQ costs every plate from live ingredient prices.
- Receiving a delivery updates ingredient cost, and every recipe using it recalculates instantly.
- Each sale deducts exact ingredients, so you see real-time stock and used-vs-sold variance.
- Set a target food cost % and DineHQ flags the dishes eating your margin — all on any phone.
30-day free trial · No contract · Setup in under 5 minutes