Restaurant Prime Cost Calculator
Prime cost — food, beverage, and labor — is the number that makes or breaks a restaurant. Enter three figures to see yours as a percentage of sales, against the range most restaurants target. Free, no sign-up.
Prime cost is cost of goods sold plus labor. Many restaurants aim to keep it at or below about 60–65% of sales, though the target varies by concept.
This is a planning estimate, not accounting or business advice. Prime cost is one operating metric and excludes rent, utilities, and other overhead. The target range is a general industry guideline, not a rule for your specific restaurant. We keep restaurant books clean so these numbers are accurate — for tax and entity decisions, work with a CPA.
Why prime cost is the number to watch
A restaurant has dozens of expenses, but two of them — the food and drink you sell, and the people who make and serve it — dwarf the rest and move every single day. Added together, that's your prime cost, and it's the biggest lever you actually control. Rent is fixed; your menu pricing, portioning, vendor deals, and scheduling are not. Tracking prime cost as a percentage of sales tells you, in one number, whether the controllable side of your restaurant is healthy. Many operators target somewhere around 60% to 65% of sales, but the right number depends on your concept — a bar runs different math than a full-service kitchen.
A number is only as good as the books behind it
Prime cost is simple math, but it's only useful if your food cost and labor are categorized correctly and consistently every month. If invoices land in the wrong account or payroll isn't fully captured, the percentage lies to you. That's the part we handle — clean, current restaurant books so the metric you're steering by is real, and so you can spot a creeping food cost before it eats your margin.
This calculator is a planning tool, not accounting or tax advice. Prime cost excludes overhead like rent and utilities and isn't a measure of profit. We keep your restaurant's books accurate so decisions rest on real numbers — for tax and entity questions, work with a CPA.
Frequently asked questions
Prime cost is your cost of goods sold (food and beverage) plus total labor cost (wages, payroll taxes, and benefits). It's the largest controllable chunk of a restaurant's expenses, which is why operators watch it closely.
Many restaurants aim to keep prime cost at or below roughly 60% to 65% of sales, though the target varies by concept — full-service often runs higher than quick-service. Use it as a directional benchmark, not a hard rule.
Tighten food cost through portion control, waste reduction, and vendor pricing, and manage labor by scheduling to demand. Accurate, current books let you watch the percentage month to month so you catch drift early.
No. Prime cost is cost of goods sold plus labor only. Rent, utilities, marketing, and other overhead are separate. It's a focused operating metric, not your full profit and loss.
Know your prime cost every month, not once a year
We keep restaurant books clean — food cost, labor, tips, and sales tax categorized right — so your prime cost and margins are accurate and current, not a guess at tax time. Spanish-friendly support available.