How to price your menu: from dish cost to price
Pricing by gut leaves profit on the table or drives customers away. Here is a one-number method to start from, then adjust.
Step 1: work out the dish cost
List every ingredient in the dish, its quantity, and its purchase price per unit. Add the line costs (quantity × unit price) to get the recipe cost, then divide by the number of portions for the cost per portion.
Step 2: set a target food-cost percentage
Most restaurants target 28–35%. Items with cheap ingredients (drinks, sides) can carry a lower percentage; meat and seafood are often higher. Pick a number per category.
Step 3: calculate the price
Price = cost per portion ÷ target food-cost percentage. Example: portion cost 0.95 and a 30% target ⇒ price ≈ 3.17. Round it to a comfortable menu price (e.g. 3.25).
Step 4: review with the engineer's and the customer's eye
Compare the calculated price with competitors and with what your customer expects. Adjust presentation, portion or ingredients rather than cutting the price directly. Your best-sellers deserve the closest review.
Do it with a free calculator
RAWA's free dish-cost calculator does steps 1–3 instantly with no sign-up: add ingredients, quantities and prices and get the portion cost, the food-cost percentage and a suggested price.
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A 100% Arabic-first cloud restaurant system — an offline-capable POS, kitchen display, QR menu, inventory & recipes, and accounting with e-invoicing (JoFotara) on both plans.
Start a free 7-day trial — no cardCommon questions
Do I add tax before or after?
Calculate the price ex-tax first, then add tax per your system — the POS computes it automatically on the invoice.
What about labour and rent?
They don't go into a single dish price directly; they are covered by total margin. Watch prime cost and break-even at the restaurant level.