Prime Cost Calculator
Food, beverage, and all-in labor against the revenue they produced. One number that tells you whether the business works.
Food, beverage, and all-in labor against the revenue they produced. One number that tells you whether the business works.
Enter your costs and the revenue for the same period. Use total labor including payroll taxes and benefits, not just wages.
Prime cost % = ((food + beverage + total labor) ÷ revenue) × 100
Prime cost matters more than either half alone because the two halves trade against each other. Buy pre-portioned chicken and food cost climbs while labor falls. Break down whole birds in house and it reverses. Watch one number in isolation and you will celebrate an improvement you already paid for on the other line.
A month on $86,000 of revenue: $24,800 food, $4,600 beverage, $29,400 all-in labor. Prime cost is $58,800 — 68.4%. That leaves $27,200 for rent, utilities, insurance, marketing, debt, and profit. In most markets that is too thin, and it says so before the P&L does.
Find which half moved. If cost of goods drifted, the cause is usually pricing that never got revisited — ingredient costs climbed and menu prices stayed put. Re-cost your top sellers first with the recipe cost calculator, then check what you should be charging with the menu price calculator.
If labor moved, separate the schedule from the sales — a slow week raises labor percentage without a single extra hour being worked. The labor cost calculator breaks out the burden so you can see which it was.
Read more in food cost vs prime cost.
Prime cost is cost of goods sold (food and beverage) plus total labor, divided by revenue. It bundles the two biggest expenses a restaurant has — and, crucially, the two it can still change after opening. Rent is fixed the day you sign; prime cost is not.
Full-service restaurants target 60–65%. Quick service can run 55–60% because labor is lighter. Above 70% is where most restaurants stop being able to cover rent, utilities, and debt service — profit at that point depends entirely on volume.
Prime cost = (food cost + beverage cost + total labor cost) ÷ total revenue × 100, all for the same period. Labor must include payroll taxes and benefits, not just wages. If food and beverage run $29,400 and labor runs $29,400 on $86,000 of revenue, prime cost is 68.4%.
Because the two halves trade against each other. Buying pre-cut produce raises food cost and lowers labor; prepping in house does the reverse. Watch either number alone and you can congratulate yourself for an improvement you paid for somewhere else. Prime cost is the number that cannot be gamed that way.
Weekly if you can, monthly at minimum. Monthly is a post-mortem — the period is over before you see it. Weekly gives you time to change a schedule or a purchase order while it still affects the outcome.
Prime cost drifts when recipe costs drift. Freecost keeps every dish costed against live ingredient prices — free, web and Android.
Start free — no credit cardFreecost is free recipe-costing software built by a chef. Web + Android.