Restaurants- Labor costs > food costs always?

[JEDI]

ie: starbucks:
A frappachino is 1/2 ice, yet costs more than a regular cup of coffee. a cup of coffee is very quick to serve, while a frap takes more time.

but is it true at high price steak houses? or would the steak cost more than the guy cooking it since the cook can grill multiple ones at the same time?

 

[vi edit]

We try to stick around a 10% food cost and a 15% labor cost. Labor will amost always be higher because you have things like drinks, appetizers, salads, and desserts that are all very low on food costs evening out expensive items like steak.

 

[Alchemist99]

You think Ice is free?

 

[episodic]

Depends on the type of restaurant. I use to do purchasing for a seafood place and food cost ran about 33% - but we were giving away snow crab legs and 40/50 shrimp on an all you can eat (not the kind where they have 5 shrimp and a broke pair of tongs either). . .

 

[Mill]

I think it depends on if it is a chain or not too. People that have bulk agreements with suppliers, or produce their own stuff can have cheaper food costs than a mom and pop restaurant.

 

[CTrain]

Originally posted by: vi_edit
We try to stick around a 10% food cost and a 15% labor cost. Labor will amost always be higher because you have things like drinks, appetizers, salads, and desserts that are all very low on food costs evening out expensive items like steak.

Is this a full service ?? That figure is way too low.
For fast food.....Food(this include all paper that associate with food) ~25%-30%. Labor ~22%-28%.
Food cost is going to remain pretty much constant as business increases but labor will go down.
So in busier fast food, labor will > food cost.

 

[CTrain]

Let me add that I remembered reading in Restaurant News that Food cost for full service will always be > labor.
Of course the reason being servers and bartenders get paid little.

And vi_edit...no offense man but its impossible to have 10% food cost unless all you selling is soda.
Soda is the cheapest food cost possible and even that selling a 16oz drink for $1 will still cost you around 8cents. Thats 8% right there so 10% is very unrealistic.

 

[vi edit]

Is this a full service ?? That figure is way too low.

It's full service with dine, carry out, and full bar. We run a very tight ship.

Even our franchised fast food locations have very low labor cost and food costs. We run about 1/3-1/2 what corporate stores run for labor costs.

 

[vi edit]

I might have flip flopped the costs. Or, maybe the alcohol sales are so high that it offsets it.

 

[Jhill]

The hotel I work at is about 30% food cost and I think the kitchen alone (not the servers) run about 7% labor cost.

 

[CTrain]

Originally posted by: Jhill
The hotel I work at is about 30% food cost and I think the kitchen alone (not the servers) run about 7% labor cost.

That seems about right....every report I've seen so far has restaurants(all types) running >25% food cost.
If you're able to get it down to 20%, you're a superstar.

 

[JEDI]

so the best thing would be to run a shop with all high margin items? that seems to be soda/alcohol/liquids.

oh wait, that's a bar. Hm..no..bars have a age requirement set by law (age 21 or above). and you see bars go under all the time. so alcohol's out since it limits your customer pool.

Hey..Starbucks!

 

25% + is average for food cost. Where I work it averages around 22% but we also run a commissary for all the properties in town. Don?t ask about labor costs. Culinary bargaining agreement is killing us.

 

[LeetViet]

Originally posted by: Alchemist99
You think Ice is free?

Wonder if they use purified water.:Q

 

Originally posted by: LeetViet

Originally posted by: Alchemist99
You think Ice is free?

Wonder if they use purified water.:Q

Ice makers cost money and there is maintenance costs and they don?t create the power they use