Kitchen Finance

Prime cost

By Kitchen Finance editors, Editorial desk.

Last updated

Two hands turning pasta inside a hollowed wheel of cheese.

Prime cost

Prime cost = food COGS + beverage COGS + labor. Prime cost % = prime cost / total sales.

Food and beverage costs are usage, not purchases. Labor includes wages, payroll taxes, and benefits.

The food-cost week, with labor added and no beverage cost.
LineAmount
Food cost12,040
Beverage cost0
Labor13,700
Prime cost25,740
Sales42,800
Prime cost %60.1%

Add the costs you can still move

Rent does not change because Thursday was slow. Food usage and labor do. Prime cost puts those two (and beverage, when you sell it) over the sales the building actually did.

Build it from the other two hubs

Food cost comes from a count. Labor comes from the payroll register, including taxes and benefits. If either input is purchases-only or wages-only, the prime cost percentage is a different statistic wearing the same name. The guide under this hub shows the arithmetic. The calculator opens on the same week.

Guides in this hub

Guide How to calculate prime cost

Add food cost, beverage cost, and labor, then divide by total sales. In the worked week on this page that is 25,740 over 42,800, or 60.1 percent. The association's 2024 limited-service median was 65 percent of sales, and it is a median, not a target.

Tools

Calculators that open on a worked example.

Tool Prime cost calculator Tool Food cost calculator Tool Labor cost percentage

FAQ

Short answers to the questions this page is built to settle.

Is 60 percent a target?

No. 60.1 percent is the arithmetic of this illustration. The association median cited on the benchmark page is also a median, and the association says it is not a goal.