Food Cost 201: Pricing Your Menu for Max Profits
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- เผยแพร่เมื่อ 24 พ.ย. 2024
- Pricing your food truck menu can be challenging. How will you know if you are charging enough? In Food Cost 201: Pricing Your Menu for Max Profits we will go over how to price your menu, creating a combo and the best placement of your high profit items on your menu board.
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I am a forty-year veteran of the food industry. Besides working for several national chains, I have owned and operated my own carts and trailers. After hanging up my tongs and spatula last year I wanted to help clear up many of the misconceptions that abound in this industry. My videos will be designed to inform and train. I have tons of free forms, checklists and other useful food related paperwork on my website. Best of all no email required.
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not expected these kind of deep information at just 11 minuts video(strongly rcommended to all)
wow! was expecting some basic video but this was so informative , Thankyou!
WONDERFUL INFORMATION...THANK YOU.
Thank you for the detailed break down of the food cost and how to set menu prices. An eye opener for a New Bis like me, but don't you think x4 is not going to be enough when you add Your truck payments, equipment payments, licences, insurance, credit card processing service, waste, theft, a safety net if you have to replace/fix your equipment or your truck ... What should be your labor cost?
A 25% food cost means you have 75% left over to apply to the remaining expenses. Food service runs a combined food and labor cost of 55% to 60%. Where a food truck becomes more profitable than a B&M is the remaining expenses are significantly lower than a B&M and in many cases does not have the full range of expenses either. Waste and theft are a part of food cost. If your menu prices are set to yield 25% food cost then both waste and shrink must be tracked. Actual food cost must be compared to the theoretical food cost and then the waste and shrink totals come into play. Actual food cost plus waste should equal theoretical. If not then the missing amount is shrink. Tracking shrink is important and figuring out what is producing the shrink. Such as unaccounted for waste or someone just stealing. Ideally waste is less than .6% and shrink should be worked to zero. The safety net you mention for repair and maintenance is accounted for in a break even analysis and that money set aside daily. Credit card processing is accounted for in menu pricing and when cash is paid you make more money. Truck payment, equipment payments, licenses, insurance are fixed costs as they must be paid whether your are open or closed. Fixed costs are a part of a breakeven analysis. 25% works when you understand how it plays with the other variable costs and how it computes the breakeven point when the fixed costs are added.
@@FoodTruckTrainingGroupI am waiting on your book, it should arrive today, Thank you for the video and the input.
Clear and informative
Lol a 6.25 burger today would be welcomed with open arms 😂
Thanks this is helpful
When talking about where to place menu items you say upper right catches most attention, yet the arrow and the menu on screen indicated upper left. Which would be correct?
Eagle eyes! You are correct I don't know my left from my right! The image is correct. People tend to read a menu the same way they read a book or letter starting from the left side. When you put a featured item there it gets more attention and notice than when placed anywhere else.
@@FoodTruckTrainingGroup that’s what made sense to me, but wanted to ask as I’m a newb! Lol. Thanks
Good
Is the spreadsheet linked somewhere? I'm not seeing it. Thank you.
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What about when penetration of market at starting of the business is more important than profit and keep *3 the cost?
In food service it is always harder to raise prices. Running a 33% food cost requires deeper pockets to stay afloat as a business. It can certainly be done but why make it harder than necessary? Writing a recipe to yield 33% is one thing actually achieving that is another. Generally inexperienced folks run 4% to as much as 10% higher on actual food cost to theoretical food cost. When I recommend a 25% food cost I am also assuming it will not be achieved, especially during that market penetration phase.
@@FoodTruckTrainingGroup thank you for such in depth guidance. Certainly help us all in setting up own things. Doing a great job 👍
Magnifique
Great video but I have one question though.I'm about to open my small scale home based potato chips business.so will it also gonna work with my potato chips business?I mean calculating total food cost and then multiplying it by three.will it be enough to find selling price for my potato chips and generate profit?or do we also need to add 10 percent more to that number that we got by multiplying total food cost by 3?
As video says at 6:12 multiple the cost of all ingredients by FOUR not three. This gives you a starting point to determine if that price will generate the profit you need. You will need to know all your other expenses and compare that total expense to the sales you think your business will generate then adjust the price as necessary to generate the profit you want and to keep your prices at a level that people will pay.