Pizza food cost and margin calculator

Updated 14 September 20267 min readRomain Ferrand — pizzaiolo, 12 years in trucks and dining rooms

Food cost is what the ingredients and the box cost you; the ratio is that figure against the ex-VAT selling price. Comparing it against the menu price instead — which includes 20% VAT you do not keep — flatters every margin on your menu by about a fifth.

g
£/kg
g
£/kg
g
£/kg
£

Meat, vegetables, egg…

£

Box, paper, label.

£

Including VAT, as printed.

Food cost

£1.94

Food cost ratio

21.1%

Against the ex-VAT price

Gross margin

£7.23

78.9% of ex-VAT

Multiplier

× 5.7

Menu price ÷ food cost

Flour
£0.13
Sauce
£0.16
Cheese
£0.65
Toppings
£0.70
Packaging
£0.30
Total food cost
£1.94
Menu price, ex-VATVAT 20%
£9.17

The other way round: what should I charge?

%

Suggested menu price

£8.31

Including VAT

Why it has to be the ex-VAT price

This is the commonest and most expensive mistake. You buy ingredients without VAT; your menu shows a price with VAT in it. Comparing the two directly credits you with the VAT as though it were margin — it is not yours, you hand it to HMRC.

On an £11 pizza at 20%, the ex-VAT price is £9.17. A £2.60 food cost is 28% of that, not 24%. Four points does not sound like much until it is applied across every line on the menu for a year.

What a sensible ratio looks like

Typical food cost ratios on the ex-VAT price
RatioMultiplier
Margherita and simple classics20 – 25%× 4 – 5
Loaded and meat pizzas28 – 33%× 3 – 3.5
Premium or seasonal specials33 – 38%× 2.6 – 3
Soft drinks10 – 20%× 5 – 10

Working ranges, not rules. A single high-ratio dish is fine if it sells the rest of the menu.

Chase the blended ratio across what actually sells, not the ratio of each dish in isolation. The margherita subsidising a generous special is a normal and healthy arrangement; the special subsidising nothing is not.

What this deliberately leaves out

Labour, rent, energy, waste and the commission on a delivered order. Food cost is one line, not profitability — a pizza with a beautiful 24% food cost sold through a platform at 30% commission is a different business entirely.

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