How to calculate a restaurant dish price
The complete formula: food cost, waste, target margin and local market adjustment.
Calculate the real food cost
Food cost is the total ingredient cost of a dish, including waste (losses during preparation).
Formula:
Food cost = Σ (gross quantity × price/kg)
gross quantity = net quantity × (1 + waste % / 100)
📌 Example — Paella Valenciana (1 portion):
| Ingredient | Net | waste | Price | Cost |
|---|---|---|---|---|
| Bomba rice | 100 g | 0% | €1.80/kg | €0.18 |
| Chicken | 150 g | 15% | €5.20/kg | €0.90 |
| Prawns | 80 g | 20% | €16/kg | €1.54 |
| Olive oil | 20 ml | 0% | €6.50/l | €0.13 |
| Saffron | 0.3 g | 0% | €8000/kg | €2.40 |
| Total food cost | €5.15 | |||
Apply the target margin
The target margin varies by dish type. For rice dishes and mains: 30–35% food cost (65–70% margin).
Formula:
Price excl. VAT = food cost ÷ target food cost
Price incl. VAT = price excl. VAT × 1.10
📌 Example — Paella (food cost 35%):
€5.15 ÷ 0.35 = €14.71 → €14.50 (rounded)
€14.50 × 1.10 = €15.95 (VAT included)
Spanish hospitality applies 10% VAT. Replace the factor with the rate that applies in your country.
Adjust to the local market
The calculated price is the minimum viable one. Compare it with the median price of similar restaurants in your area.
Torrevieja coast
€16–22
High season
Alicante
€14–20
Year round
Central Madrid
€15–22
No seasonality
If your price sits more than 15% below the local median you are giving away margin; if it sits well above, make sure your offer justifies it.
Reference margins by category
| Category | Food cost % | Margin |
|---|---|---|
| Tapas / small plates | 25–30% | 70–75% |
| Rice / paella | 30–35% | 65–70% |
| Meat | 35–40% | 60–65% |
| Fish | 35–45% | 55–65% |
| Drinks | 15–25% | 75–85% |
| Desserts | 20–28% | 72–80% |
VAT: the figures in the table are shown before tax.
Calculate your dish's optimal price in 30s
Pricora does it automatically: food cost with waste, local market benchmark and season and area adjustment.
Analyze my dish free