Menu pricing: never set a price before you know the plate cost
Most venues set prices one of two ways: by looking at the place across the street, or by feel. Both lead to the same place — you may be earning least on the item you sell most, and not know it.
Start with the right question
"What should I charge for this coffee?" is the wrong question. The right one is: what does this coffee cost me to make? Price sits on top of that number. A competitor's price is a sanity check, not a starting point.
Step 1 — Write the recipe
A recipe is everything that goes into one serving, measured. Not roughly — in grams. For a latte:
- Coffee beans: 18 g
- Milk: 200 ml
- Cup and lid: 1
- Sugar and stirrer: 1
The most common omission here is packaging. Cups, lids, napkins and straws look trivial per serving. At two hundred servings a day they are a monthly line item.
Step 2 — Convert to unit cost
Take what you pay and convert it to the unit you use. Illustrative numbers — replace them with your own invoices:
- Beans at 600 ₺/kg → 0,60 ₺/g → 18 g = 10,80 ₺
- Milk at 40 ₺/L → 0,04 ₺/ml → 200 ml = 8,00 ₺
- Cup and lid = 3,50 ₺
- Sugar and stirrer = 0,50 ₺
Raw cost: 22,80 ₺. These figures mean nothing until you redo them with your own supplier prices.
Step 3 — Add a waste allowance
Not everything sold is everything used. Spilled milk, pulled shots that get dumped, pastries that go stale, plates sent back. That is waste, and if it is not in the cost, your margin exists only on paper.
Waste varies by item — low on dry goods, high on fresh. Measuring your own rate is simple: for one week, record what came in and what was sold, and write down the gap. Do not estimate; estimates always come out lower than reality.
At 8% waste: 22,80 × 1,08 = 24,62 ₺.
Step 4 — Choose a target food cost percentage
Food cost percentage is raw cost divided by selling price. Drinks usually carry a lower percentage than food, because they take less kitchen labour.
With a 25% target:
Price = cost ÷ target = 24,62 ÷ 0,25 = 98,48 ₺
This is before VAT. If your menu prices include VAT, add it on top — forgetting this takes the difference straight out of your margin.
Step 5 — Now look at the competition
- You come out below them. Before raising the price, ask what you are buying cheaply. You may have a real advantage.
- You come out close. The healthiest outcome. Place the price there.
- You come out well above. Cutting the price is the wrong answer. Revisit the portion, the supplier or the item itself. Selling at a loss is not competing, it is a postponed closure.
Your best seller may not be your best earner
Everyone who does this exercise finds one of these. Menu engineering looks at two axes: how much it sells and how much it earns per serving. Four quadrants:
- Sells a lot, earns a lot: the star. Put it where it is seen, and give it your best photograph.
- Sells a lot, earns little: the dangerous one. Revenue looks healthy, profit is not there. Fix the cost or the price.
- Sells little, earns a lot: a visibility problem. Its position, name or description is not doing its job.
- Sells little, earns little: ask why it is still on the menu. Every item carries stock, prep and waste.
How to raise prices
Delaying an increase after costs rise is the common mistake. Waiting months and then making one large jump provokes far more reaction than small, regular adjustments.
You also do not need to raise the whole menu by the same percentage. Adjusting the item whose cost actually moved is both fairer and less visible.
You can do all of this by hand
Everything above works in a spreadsheet, or on paper. What matters is not the tool but doing it regularly. An unmaintained cost sheet is more dangerous than none, because it gives false confidence.
In SiparaQR, recipes and plate cost live in the panel: enter a recipe and stock deduction and margin are calculated together, so you see the margin on the same screen where you change the price. But the tool is useless without the method — which is why this article is almost entirely method.