Pricing and profitability
How ChefAdmin works out cost, suggested price and profitability, and how to set a dish's selling price.
Set a selling price
Make sure the item is Non-active
You cannot change the price of an Active item. If it is Active, set its Status to Non-active first.
Open the price editor
On Menu Items, click the item's name. The Edit window shows:
| Field | Meaning |
|---|---|
| Cost | What the ingredients cost today. |
| Brand FCR % | Your brand's target food cost ratio. |
| Suggested Price | The price that hits that target, including VAT. |
| Tax % | Your VAT rate. |
| Final Menu Price (incl. Tax) | Your selling price. This is the only field you type in. |
| Profitability % | Worked out on the price excluding VAT. |
Enter the price and submit
Type the price including VAT and click Submit. You cannot submit a price that loses money (profitability below zero).
Switch it back on
Set the status back to Active. See Put a dish live.
How the numbers are worked out
Cost is recalculated every time you open the page, from today's prices in your inventory, using your company's stock method (FIFO or LIFO). It is the sum of each ingredient's quantity times its unit cost, including sub recipes.
Price excluding VAT = selling price ÷ (1 + VAT rate).
Profitability % = (price excluding VAT − cost) ÷ price excluding VAT × 100.
Suggested price = cost ÷ brand FCR %, with VAT added. It shows 0 if the brand has no FCR target.
Worked example
A burger costs AED 12.60 to make. The brand FCR target is 30% and VAT is 5%.
- Suggested price: 12.60 ÷ 0.30 = 42.00, plus 5% VAT = AED 44.10.
- You set the selling price at AED 47.25. Excluding VAT that is 47.25 ÷ 1.05 = 45.00.
- Profitability: (45.00 − 12.60) ÷ 45.00 = 72%. Food cost ratio: 28%.
Set your brand FCR target
A Company Manager sets Brand FCR % in Settings > Brand, editing the brand. It accepts 0 to 99.
Why your costs move
The cost is only as true as your prices. ChefAdmin keeps them current from the purchase orders you raise and the deliveries you receive. If you stop ordering through ChefAdmin, costs stop moving. See How your food cost stays true.