How to cost a recipe (with a free recipe costing template)

Cost cards go stale when ingredients are imported, a supplier changes the price mid-month, and the menu board already includes VAT. A card from January is not the plate you sell in July. This guide is one recipe: edible-portion yield, a Q factor, the price excluding VAT, and a worked chicken shawarma sandwich on national average retail prices. Those prices are a ceiling, not a wholesale invoice. Groups get a short note and a link onward. A weekly stock percentage is a different job from a plate cost.

How to cost a recipe in 6 steps

Do these six steps in order. The template has a column for each of them.

1. 1. Write the standard recipe (every ingredient, batch size, portions, portion weight)

   Write every ingredient, the batch size, the number of portions, and the portion weight. A handful is not a quantity. The card you cost is the card the station is supposed to cook.

2. 2. Convert purchase units to recipe units (for example, a 1.5 L bottle to grams)

   Convert the purchase unit into the unit on the recipe before you multiply. A 1.5 L bottle of oil is not 1.5 grams. If you use a density to turn litres into grams, label it as an assumption.

3. 3. Apply yield to get edible-portion (EP) cost

   Edible-portion cost per kilogram equals the purchase price per kilogram divided by the yield percentage. A 52% roasted yield means you divide by 0.52, not by 1. The invoice weight is what you paid for. The edible weight is what the guest gets.

4. 4. Cost each line and add a Q factor

   Multiply each edible quantity by its edible-portion cost and add the lines. Then add a Q factor for frying oil, salt, and garnish that are not already on a line. Do not hide a sauce inside that factor. Cost the sauce as a sub-recipe and link it in.

5. 5. Divide by portions to get cost per portion

   Divide the batch cost, including the Q factor, by the number of portions. That is the cost per portion. Packaging is a separate line, especially on delivery, and it is not inside this food cost.

6. 6. Compare with the price excluding VAT and set the menu price

   Divide the portion cost by the menu price excluding VAT. In Saudi Arabia the displayed price includes 15% VAT, so divide that price by 1.15 first. Set the menu price from a target percentage on the net price. In another market, divide by 1 plus the VAT rate where you operate.

Where recipe costing usually goes wrong

Costing at invoice weight, not edible weight

The invoice sells you bone, skin, fat, and water you will lose in the pan. If you multiply the cooked grams by the raw price per kilogram, the card looks cheap and the week looks mysterious. Edible-portion cost is the purchase price divided by the yield. The Culinary Institute of America writes the yield percentage as the edible weight divided by the as-purchased weight, and the edible-portion price as the as-purchased price divided by that yield (kitchen calculations).

Leaving out sauces, marinade, garnish and frying oil

A sauce, a marinade, and a dough are recipes. Cost them once and link them into the dish. Frying oil that is absorbed, salt, and a garnish you do not weigh on every plate are what a Q factor is for: a small allowance on top of the lines, not a place to hide the toum (hidden food costs, costing recipes). If the sauce is inside the Q factor, a butter price change never reaches the twelve dishes that use it.

No date costed, and no previous portion cost

A cost sheet that cannot show when it was last priced, or what the portion cost was then, cannot show drift. A standardized recipe cost sheet keeps the date costed and the previous portion cost for that reason (Dopson cost sheet). A former chain CFO, quoted in a trade article, called a sheet that has not been re-costed in six months fiction (Restaurant Bottom Line). The quote is theirs, not a result from this site.

Dividing by the VAT-inclusive menu price

Food cost percentage is portion cost divided by the price the restaurant keeps. In Saudi Arabia the price on the board includes 15% VAT (ZATCA retail guideline). Dividing by the inclusive price makes the percentage look better than the kitchen is running. The worked example below shows how large that gap is.

Worked example: costing a chicken shawarma sandwich

The gram weights are an example built so those retail prices land on a food subtotal of SAR 5.66. They are not a weighed kitchen test, not a wholesale invoice, and not a recommended portion. These inputs are examples, not published tests or invoice prices: vegetable oil density of 0.92 kg per litre, tomato yield of 90%, pickles at SAR 12 per kg, the spice mix at SAR 0.15 per sandwich, the toum sub-recipe at SAR 0.30 for 20 g, the 3% Q factor, and packaging at SAR 0.40.

The toum is one illustrative sub-recipe: 20 g at SAR 0.30 on this sandwich. Cost that sauce once and link it into every dish that uses it. The marinade sits on the sandwich: yoghurt 15 g, garlic 3 g, lemon juice 5 g, and vegetable oil 5 g. Chicken uses the 52% roasted thigh yield, garlic the 87% yield, and lemon the 45% juice yield cited in the yield section. Tomato at 90%, the oil density, the pickles, the spice allowance, the 3% Q factor, and the packaging are examples. Food cost is SAR 5.83. Packaging stays at SAR 0.40 beside it, not inside it.

Pricing it

These menu prices are arithmetic on the example food cost of SAR 5.83. They are not observed shawarma prices and not a recommended selling price. For Saudi Arabia, menu price including VAT = (portion cost ÷ target food cost %) × 1.15.

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  28% target: 5.83 / 0.28 = SAR 20.82 net, × 1.15 = SAR 23.95 including VAT.

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  30% target: 5.83 / 0.30 = SAR 19.43 net, × 1.15 = SAR 22.35 including VAT.

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  32% target: 5.83 / 0.32 = SAR 18.22 net, × 1.15 = SAR 20.95 including VAT.

A reverse check on the same SAR 5.83, still an example and not a market survey: a board price of SAR 15 including VAT is 5.83 / (15 / 1.15) = 44.7%. A board price of SAR 18 including VAT is 37.3%. Both are the food cost on the net price.

The costly mistake

Costing the same 100 g of cooked chicken at the raw retail price (SAR 22.00/kg) gives SAR 2.20. Costing it at the edible-portion price gives SAR 4.23. The card is short by SAR 2.03 on the chicken alone. Illustrative arithmetic, not a customer result and not a forecast: 300 sandwiches a day × SAR 2.03 is about SAR 609 a day. Taken across 30 days that is about SAR 18,000 (300 × 2.03 × 30 = SAR 18,270). The 300 is an example volume, not a sales figure from a branch.

Side note: whole chicken looks cheaper until you cook it

On the same July 2026 retail table, fresh local chicken, 900 g, is SAR 17.60, which is SAR 19.56 per kg. At the 45% roasted yield for a whole bird in the chicken study below, that is about SAR 43.46 per cooked kilogram (17.60 ÷ 0.9 ÷ 0.45). The thigh, at SAR 42.31 per cooked kilogram, is not the expensive choice once both are cooked. This side note is not a line in the sandwich.

Yield: cost the edible portion, not the invoice

The yield formula

AP is the as-purchased price. Yield % is edible weight divided by as-purchased weight. The yield percentage formula is the full version of this step. The CIA sheet states that yield also moves with the skill of the person trimming, the size of the product, and its condition, so a yield copied from a book is a starting point (kitchen calculations). Re-test when the supplier or the cook changes.

Published yields

Chicken yields below are from a Texas A&M study of broiler parts (PDF, record). Figures are proportions of the raw part or of the whole bird.

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  Chicken thigh: 0.79 raw meat and skin, 0.66 meat only, 0.52 roasted.

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  Whole chicken: 0.70 raw meat and skin, 0.58 meat only, 0.45 roasted.

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  Lamb: 43% to 50% boneless closely trimmed retail cuts from live weight, or 65% to 75% bone-in. A carcass can also shrink 2% to 5% in the first 24 hours (Wisconsin extension).

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  Fish, US norms, about plus or minus 3 percentage points: grouper about 42% to 43% skinless fillet, red snapper about 48% skin-off, tilapia 30% to 35% fillet, farmed salmon headed and gutted 68% to 72% (Chefs Resources). These are not a Gulf yield test.

Hamour example

Fresh hamour (grouper) on the July 2026 retail table is SAR 60.50 per kg (GASTAT). Applying the US grouper skinless-fillet yield of about 43% gives SAR 60.50 / 0.43, about SAR 140.70 per kg of skinless fillet. That is an example that borrows a US yield. It is not a local filleting test. Weigh your own fish before you put SAR 140.70 on a card.

What people forget

Trim loss and cooking loss are two hits. The thigh study shows 0.66 as raw meat and 0.52 after roasting. Using only the raw trim understates a grilled plate. Yield changes with skill, piece size, and supplier, so re-test. Bones and trim earn a credit only if you use them in a stock you cost. If they go in the bin, they stay in the edible-portion price.

How to run a yield test in 15 minutes

Use the CIA order of weights. Weigh the ingredient as purchased. Trim it the way the recipe does and weigh what is left. Cook it the way the recipe does and weigh what is left. Yield % = cooked edible weight ÷ as-purchased weight. EP cost = purchase price ÷ that yield. Write the date on the card. A batch kitchen does the same three weighs on the batch, which is the production side of central production. This page does not publish a Gulf yield test.

Keeping costs current when supplier prices move mid-month

Why it matters in 2026

A fixed card cannot keep up with a mid-month invoice. In the UAE, a survey reported by Al-Monitor put supplier costs up 13% on average, one Dubai chef said air freight had added 30% to 35% on some seafood, and the country imports most of its food (Al-Monitor). A USDA attaché report, citing the Ministry of Climate Change and Environment, puts food imports at about 90% (USDA GAIN).

In Saudi Arabia, food and beverage prices were up 1.4% year on year in August 2026 (Enterprise, reporting the official release). That index is not the line. On the July 2026 retail table, local tomatoes were up 39.5% year on year and down 9.8% on the month, and imported chilled sheep meat was up 11.6% year on year and 4.3% on the month (GASTAT). Argaam, reading commodity prices, showed imported frozen chicken about 10% higher year on year in August 2026, and a gap of about 38% to 48% between the cheapest and dearest chilled chicken of the same pack size (Argaam). A calm index can hide a line that moved this week.

What weighted average cost is

Weighted average cost (WAC) blends each new delivery with the stock you already have. The unit cost is the total value divided by the total quantity. You do not keep a separate price for each lot.

Example, not a supplier and not your store: 20 kg already on hand at SAR 20 per kg, then 30 kg received at SAR 23 per kg. Value on hand is 20 × 20 = SAR 400. Value received is 30 × 23 = SAR 690. Combined value SAR 1,090 divided by 50 kg is SAR 21.80 per kg. The next recipe that uses this item uses SAR 21.80, until the next invoice blends in.

Why WAC handles mid-month changes better than a fixed card or FIFO

FIFO (first in, first out) is a valid accounting method, not a mistake. It is harder in a kitchen, because a new delivery usually goes into the same bin as the old one. A fixed card waits for a quarterly tidy-up while the invoices have already moved.

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  The unit cost updates when the invoice is received, so every recipe that uses the item re-costs then, not at quarter end.

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  There are no purchase layers to track per lot. Kitchens rarely can, once both deliveries share a bin.

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  A one-off spike is smoothed into the stock you still hold, instead of the cost jumping from the old price to the new price as each lot runs out.

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  One blended cost per item per branch makes theoretical versus actual variance comparable from week to week.

AKLI costs recipes at weighted average cost. Each new delivery is blended with stock on hand, and the unit cost is total value divided by total quantity. Recipes use that blended cost, not FIFO layers.

Rule of thumb

Update ingredient costs from every invoice, not once a quarter. When the cost is current, buy to the par the branch actually uses, which is par levels and reorder points. How a mid-period price hits purchases and the card is when a supplier price changes mid-period. Receiving the invoice into stock is purchasing and goods received.

After the card is current, the next step is how much of each ingredient to hold from that branch’s usage. The par level calculator turns daily usage, lead time, days between deliveries, and a safety buffer into a par and a reorder point.

VAT: always divide by the price excluding VAT

In Saudi Arabia, displayed prices must include 15% VAT (ZATCA retail guideline). Net price = menu price ÷ 1.15, which is the same as multiplying by 100/115. The VAT inside an inclusive price = price × 15/115. On the example board price of SAR 22.35, the net price is 22.35 / 1.15 = SAR 19.43.

That is why the percentage moves. SAR 5.83 ÷ SAR 22.35 = 26.1% if you use the VAT-inclusive price. SAR 5.83 ÷ SAR 19.43 = 30.0% on the net price. The inclusive figure is about 13% lower relative to the true 30.0% ((30.0 − 26.1) / 30.0). The kitchen did not get more efficient. The denominator got bigger by the tax.

For another GCC market, divide by 1 plus the VAT rate where you operate. This page states only Saudi Arabia at 15%. Add or remove VAT on a menu price in the VAT menu price calculator.

What food cost % should you target?

There is no single good percentage. Published ranges differ by segment, and the sources below are vendor blogs, a trade article, a supplier, a consultancy, and one practitioner opinion. None of them is a census of Gulf restaurants, and none of them is an AKLI customer result. Calculate every one of them on the price excluding VAT.

KitchenPark, a commercial kitchen supplier, says most restaurants in the region aim for 25% to 35%, and that a price can be set as cost divided by the target percentage (KitchenPark). A Dubai consultancy says cloud kitchens are typically 28% to 32% (GGB Consulting). The same consultancy published a case this site has not verified, in which it says a group moved from 44% to 29% in 120 days. Treat that as the consultancy account, not as a promise and not as an AKLI result. A practitioner writing on LinkedIn, as opinion, puts cloud kitchens at 28% to 30% and quick service at 30% to 32% (LinkedIn).

Two warnings from the trade article: delivery food cost often runs above 40% once commission is netted out, and the percentage has to be on the price excluding VAT (Restaurant Bottom Line). The period formula for a whole kitchen, opening plus purchases minus closing, is how to calculate food cost percentage. You can rerun a period in the food cost calculator, turn a target into a menu price in the menu price calculator, and read the operating shape of a delivery kitchen on cloud kitchens. Published medians from other countries, with their sources, are on restaurant food cost statistics.

Recipe costing for multi-branch groups and central kitchens

A group should not rewrite the shawarma card in every branch. Keep one master recipe: the same quantities, the same yield rules, the same sub-recipes. If you have a central kitchen, treat it as an internal supplier. Cost its batch on the yield that batch actually produced, then transfer the yielded item. Whether that transfer is at cost or at a markup is a group decision. This page does not pick one. Use one method on every transfer so the outlet and the kitchen are not telling two stories.

The purchase price is allowed to differ by branch, because the invoices do. Weighted average cost is per branch. In August 2026 the gap between the cheapest and dearest chilled chicken of the same pack size was about 38% to 48% (Argaam). A branch on the dearer bird does not have the same unit cost as a branch on the cheaper one, even when the recipe is identical.

Track variance for each branch, and track the central kitchen on its own. The single-recipe method is this page. The group method, one card and local prices, is recipe costing for restaurant groups. Batch yield and the transfer ledger are central production. Several sites as an operating model are multi-branch groups.

The recipe costing template: 10 fields most free sheets leave out

Most free sheets stop at quantity times price. These ten fields are the ones that keep a card honest after the first week. The download is the same ten fields, with one example row filled from the shawarma above and a blank row for your own dish. Ingredient lines for that example sit under the summary row.

When a spreadsheet stops working

A spreadsheet is a fair way to cost one outlet while the menu is short and prices sit still. This page does not state a branch count, a recipe count, or a "prices moved this often" cutoff for when a sheet stops working. That threshold is not a sourced figure here, so it is not given.

What is published: a review of spreadsheet audits found errors in 94% of the spreadsheets examined, with cell error rates of about 1% to 5% (Panko, arXiv). A cost card is a chain of those cells. One old price or one wrong yield lands on the plate.

What moves the work out of the sheet is mechanical. Invoice prices update the weighted average. That cost flows through every recipe and every sub-recipe. Waste is logged against the same stock. Theoretical cost, recipe cost times quantity sold, can sit next to actual cost from the count, per branch. Otter, a vendor blog, puts well-run kitchens near 1% to 2% variance and untracked kitchens at 3% to 5% or more (Otter). Those are Otter figures, not an AKLI customer result. The same records then feed purchasing and multi-branch reporting. Read AKLI versus spreadsheets, theoretical versus actual food cost, and waste and variance.

How AKLI handles recipe costing

AKLI is AI restaurant management software for food cost control, inventory, recipe costing, waste and variance, purchasing, and multi-branch reporting. It is not a POS. Your POS stays. AKLI connects to your POS to import sales, which is how a recipe cost gets a quantity sold. The import is described on integrations: Foodics, Oracle Simphony, Marn, and Sapaad are POS systems AKLI connects to, through its POS connector, or sales can come from a file.

AKLI costs recipes at weighted average cost and gives you a live P&L. A supplier invoice updates that average. Every recipe and sub-recipe that uses the item re-costs from it. Sales brought in from the POS then sit next to the theoretical cost, and the live P&L shows actual against it, per branch and for the whole group. The product pages are recipe costing and food cost. The module list is on features.

The published price is SAR 299 / QAR 290 / AED 293 / BHD 30 / OMR 31 per branch per month, excluding VAT. Details are on pricing.

If you do one thing this week

Re-cost your top 10 best-sellers with this week's invoice prices, and run a real yield test on the main protein. The same trade article that called a six-month-old card fiction says re-costing typically recovers 1 to 3 points of food cost (Restaurant Bottom Line). That is their report of a former chain CFO, not a guarantee.

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  List the ten dishes that sell the most. Ignore the rest until these ten are current.

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  Replace each key price with this week's invoice, not last quarter's card.

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  Weigh the main protein as purchased, trimmed, and cooked. Write the yield on the card.

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  Divide the portion cost by the menu price excluding VAT. Write the date costed next to the previous portion cost.

Then weigh five plates of your top protein dish during a busy service. If the card says 100 g and the plates say 130 g, the yield test was not the only leak. You do not need software to do this once. You need it to do it every week.