This is a YouTube video titled "This is why your food cost feels 'off.' #restaurantprofits #restaurantmanagement #foodcost" created in July 2025. The content features a single speaker explaining the concepts of theoretical and actual food costs in restaurant management, focusing on how to interpret food cost percentages for better profit understanding.
Two numbers you have to know. There's theoretical food cost and actual food cost. Actual food cost is how most restaurant owners operate. Theoretical food cost is what we call perfect world, ideal food cost. It's when you cost out everything on your menu down to the penny. That gives you what's called theoretical or perfect world. Now, the world is not perfect, so you can't ever run theoretical, but you can run around 2% above theoretical. So that person who called me and said my food cost is 30%, if they said my theoretical is 28, is my food cost good? I'd say, yeah, your food cost is really good because you should be able run around 2% above theoretical.
If your restaurant only works because you work 80 hours a week, it doesn't work.
