How to cost a menu of the day

You had product and it looked good on the board.

You put them as a starter, next to the mixed salad, thinking the two would balance each other.

That lunchtime eighty people came in and forty ordered cannelloni. Nobody did anything wrong. The guest simply chose, which is what they always do.

At month end you look at the numbers and they do not add up. And they do not add up because of that.

There is no single model. This is the one we use, in five steps.

The difference from à la carte costing is in steps 1 and 4. The rest is the usual work.

Yes. And this is the step people skip most often.

A €16 menu is not €16 of yours: it is €14.55. The other €1.45 is 10% VAT, and that money belongs to the tax office from minute one.

If you cost on the VAT-inclusive price, you think you can spend €4.79 on the three courses. The real figure is €4.30.

That is 48 cents per menu. At 1,000 menus a month, about €480 you thought you had and did not.

Bread, drink and coffee. In some places the aperitif too.

They sit inside the price. The guest does not choose whether to take them and you do not choose whether to serve them.

Our rule: add-ons do not earn margin; you only recover their cost. That is why add-on cost is subtracted from the taxable base before you calculate anything else.

With €1.50 of add-on cost on that €14.55, you have €13.05 left before applying target food cost.

A mixed salad starter is not the same as seafood cannelloni. Splitting cost equally across three courses is the fastest way for the main to eat the whole menu.

We start from this split. It is our starting point, not an industry standard: every kitchen has to tune it to its menu.

That is the filter. A dish that goes over does not go on, or it goes on knowing what it costs to include it.

If you apply a 33% target food cost to the €13.05 left after add-ons, the three courses cost €4.30.

But for the full menu you have to add the add-ons back in.

Total menu cost: €5.80 on a €14.55 base. 39.9%.

That is not a maths error. It is the consequence of the earlier decision: add-ons go in at cost and contribute no margin. If you thought your menu ran at 33%, it runs at 40%.

Four starters, four mains and three desserts are 48 possible combinations.

The guest picks one. You do not.

Here is a case with real costing numbers: starter €1.48, main €3.38, dessert €1.07. Total, €5.93 across the three courses.

On a €23 menu that combination fits easily: the budget is €6.40 and you have 47 cents to spare.

On a €16 menu the budget is €4.30 and you are €1.62 over. That guest’s real food cost jumps to 51%.

At 1,000 menus a month, if that were the dominant combination, €1,620 of margin disappears.

In that combination the real cost split was 25% starter, 57% main, 18% dessert, when the plan was 35 / 50 / 15. The main took seven points that were not its own.

That is why your menu average can look perfect and you can still lose money every day.

The menu of the day runs on volume. Volume means tighter margins, and tighter margins mean waste weighs twice as much as on the à la carte menu.

No spreadsheet will save you here. The secret is selling it all through, and that is demand control plus the head chef’s craft.

Costing tells you what you can put on. Waste decides how much you take home.

33% food cost is not a law. It is a comfortable starting point, and some menu-of-the-day houses work fine at 38% because volume holds it up.

The 35 / 50 / 15 split is our criterion, not a published standard. If your menu is stew-heavy, the starter may weigh more.

And the hardest bit remains: step 6, which does not exist yet — knowing in advance which concrete combinations break the margin and how to fix them without touching the price. At Tipi we are working on exactly that. If you want to try it early and tell us what you are missing, write to us.

If you want to know whether your menu actually makes money, stop wasting time: write to us and we will see how we can help.

Until the next piece that might help the trade.