Percy Plate is a web-based food cost calculator for food trucks, caterers, cottage food producers, and small restaurant owners. It lets you enter your ingredients and what you pay for them, build recipes, and instantly see the cost per serving and recommended sell price based on your target food cost percentage.

Yes. Percy Plate has a free plan that lets you create up to 10 ingredients and 5 recipes to calculate food cost. A paid subscription ($14.99/month or $119.99/year) unlocks unlimited ingredients and recipes plus inventory tracking, revenue reporting, menu engineering, Prime Cost, AI invoice scanning, FDA nutrition facts labels, FDA ingredient labels, and label printing.

How does Percy Plate calculate food cost?

You enter each ingredient, the unit you buy it in (lb, oz, gallon, etc.), and what you pay per unit. When you build a recipe, Percy Plate converts the recipe quantities to your purchase units, calculates the cost of each ingredient used, and divides by the number of servings to give you a cost per serving. It also shows the food cost percentage and a suggested sell price.

Can Percy Plate generate nutrition facts labels?

Yes. Percy Plate can look up nutrition data from the USDA FoodData Central database for each ingredient, then automatically calculate the per-serving nutrition for a recipe. It generates an FDA-format Nutrition Facts panel that can be printed directly to thermal labels (Brother, Dymo, Zebra) or Avery sheet labels in sizes 2x4 inch and 3.33x4 inch.

Can Percy Plate generate an ingredient list label?

Yes. Percy Plate generates an FDA-compliant ingredient label that lists ingredients by weight (heaviest first), automatically detects the top 9 FDA allergens, and includes your business name and net weight. Labels can be printed to thermal printers or Avery sheet labels.

What label printers work with Percy Plate?

Percy Plate supports thermal label printers including Brother QL series (DK-1202 2x4 inch labels), Dymo LabelWriter (30334 and similar), and Zebra desktop printers. It also supports Avery 5163 (2x4 inch) and Avery 5164 (3.33x4 inch) sheet labels for standard desktop printers.

Who is Percy Plate designed for?

Percy Plate is designed for small food business owners including food truck operators, cottage food producers, caterers, small restaurant owners, and anyone who sells homemade or prepared food and needs to track ingredient costs, price their menu, and produce product labels.

Does Percy Plate work on mobile?

Yes. Percy Plate is a web application that works on any device with a modern browser, including phones and tablets. You can look up ingredient costs, update recipe quantities, and check your food cost percentage from anywhere.

How do you calculate food cost percentage?

Food cost percentage = (ingredient cost per serving ÷ menu price) × 100. For example, if your ingredients cost $3.50 and you sell the dish for $12.00, your food cost percentage is 29.2%. Most food businesses target 28–35%. To set a price from a target, divide ingredient cost by your target: $3.50 ÷ 0.30 = $11.67 suggested price at 30% food cost.

What is a good food cost percentage for a small food business or bakery?

Most food businesses target a food cost percentage between 28% and 35%. Bakeries and cottage food producers often achieve lower food cost percentages (20–28%) because flour, sugar, and butter are inexpensive relative to retail prices. Full-service restaurants tend to run 30–35%. The right target depends on your labor costs, overhead, and pricing power in your market.

How do I calculate the cost per serving of a recipe?

Add up the ingredient cost for the full batch, then divide by the number of servings. For each ingredient, multiply the quantity used by the cost per unit (converting units as needed). For example: 8 oz flour at $0.89/lb = $0.89 ÷ 16 × 8 = $0.44. Sum all ingredient costs, then divide by servings. Percy Plate does this calculation automatically once you enter your ingredient prices and recipe quantities.

How does yield percentage affect recipe costing?

Yield percentage accounts for trim loss, cooking shrinkage, and waste. If you buy 1 lb of chicken but only 0.75 lb is usable after trimming, your yield is 75%. To get accurate food costs, divide the as-purchased cost by the yield percentage: $4.00/lb ÷ 0.75 = $5.33 per usable pound. Percy Plate lets you set a yield percentage (AP to EP) on any ingredient so your recipe costs reflect what you actually use.

What is the best recipe costing software for a small food business?

The best recipe costing software for a small food business depends on your needs. Percy Plate ($14.99/month) is built specifically for cottage food producers, food trucks, caterers, and small restaurants — it includes recipe costing, menu pricing, FDA ingredient labels, nutrition facts labels, inventory tracking, and revenue reporting. Competitors like meez start at $24/month and scale to $199/month. Square and Toast do not include recipe costing natively.

Is there free recipe costing software for home bakers or cottage food businesses?

Yes. Percy Plate has a free plan that includes recipe food cost calculation and menu pricing suggestions. The free plan lets you create up to 10 ingredients and 5 recipes. For unlimited recipes, FDA labels, nutrition facts, and inventory tracking, the paid plan is $14.99/month or $119.99/year. No credit card is required to start.

How do I price homemade baked goods to make a profit?

Start with your ingredient cost per batch, then divide by the number of units to get ingredient cost per item. Add packaging (boxes, bags, labels) as a per-unit cost. Then set a target food cost percentage — most cottage food bakers aim for 25–35% — and divide your total ingredient cost by that percentage to get a minimum price. For example: $0.85 ingredient cost per cookie ÷ 0.30 = $2.83 minimum price at 30% food cost. Factor in your time and overhead to ensure you are actually profitable, not just covering ingredients.

What are the labeling requirements for cottage food products?

Most states require cottage food labels to include: (1) the product name, (2) your name and home address, (3) a list of ingredients in descending order by weight, (4) a disclosure statement such as 'Made in a home kitchen not inspected by the state or local health department,' and (5) allergen declarations for any of the 9 major FDA allergens present. Some states also require net weight. Requirements vary by state — check your state's cottage food law for specifics. Nutrition Facts panels are generally not required for cottage food operations below a certain revenue threshold.

Do I need a nutrition facts label on my cottage food products?

Most cottage food producers are exempt from FDA Nutrition Facts label requirements under the small business exemption (fewer than 100 full-time employees and fewer than 100,000 units sold annually). However, you must still list ingredients in descending order by weight and declare all major allergens. Some states impose additional requirements. When in doubt, check your state's cottage food law and the FDA's small business labeling exemptions.

What allergens must I disclose on a homemade food label?

FDA requires disclosure of 9 major food allergens: milk, eggs, fish, shellfish, tree nuts, peanuts, wheat, soybeans, and sesame. These must be declared on all food labels, including cottage food products — even if a full Nutrition Facts panel is not required. The standard format is a 'Contains:' statement after the ingredient list, for example: 'Contains: Wheat, Eggs, Milk.' Percy Plate detects all 9 allergens automatically from your ingredient names.

How do I create a nutrition facts label for homemade food?

To create a Nutrition Facts label for homemade food: (1) look up the nutrition data for each ingredient using the USDA FoodData Central database, (2) calculate the per-serving amounts for calories, fat, carbohydrates, protein, sodium, and other nutrients, (3) format the panel according to FDA guidelines with serving size, servings per container, and daily value percentages. Percy Plate automates this — it looks up USDA nutrition data for your ingredients, calculates per-serving totals, and generates a print-ready FDA-format Nutrition Facts label for thermal or sheet labels.

How do I list ingredients in the correct order on a food label?

FDA regulations require ingredients to be listed in descending order by weight — the ingredient present in the greatest amount by weight must appear first. For example, if your muffin contains more flour than sugar, flour must be listed first. Sub-ingredients (like those in a chocolate chip) must be listed in parentheses immediately after the component. Percy Plate sorts ingredients automatically by weight when generating your label.

What information is required on a homemade food product label?

A complete homemade food label generally requires: (1) the name of the food, (2) the net quantity (weight or count), (3) an ingredient list in descending order by weight, (4) allergen declarations for all 9 major FDA allergens, (5) your business name and address, and (6) for cottage food specifically, a state-required disclosure statement such as 'Made in a home kitchen not inspected by the state health department.' Nutrition Facts panels are usually optional for small cottage food producers below certain revenue thresholds.

By Heidi Macomber · July 3, 2026 (updated July 31, 2026)

Actual vs. Theoretical Food Cost: Formula & Variance

Actual vs. theoretical food cost compares what your food should cost, based on your recipes, to what it actually costs, based on your inventory and purchases. The difference, called variance, can show where you might be losing profit.

Countless food businesses watch profits slip away unnoticed, simply because they never measure the gap between these two crucial numbers.

Your recipes paint the perfect picture, but your purchases reveal reality. The gap between them, called variance, is where your profit margins quietly erode.

What Is Theoretical Food Cost?

Theoretical food cost is what your business should spend if every dish is prepared exactly according to your recipes.

It assumes:

Perfect portioning
No waste or spoilage
No over-pouring or substitutions

You calculate theoretical food cost by multiplying your recipe cost per item by the number of items sold.

Think of this number as your gold standard--the best-case scenario for how smoothly and efficiently your kitchen could run.

What Is Actual Food Cost?

Actual food cost is the real amount you spent on ingredients during a specific period, based on your inventory and purchasing records.

Formula:

Actual Food Cost = Opening Inventory + Purchases − Closing Inventory

This number reflects real-world conditions, including:

Waste and spoilage
Over-portioning
Staff meals
Spills and prep loss
Untracked usage

What Is Food Cost Variance?

Food cost variance is the difference between actual and theoretical food cost:

Variance = Actual Food Cost − Theoretical Food Cost

In most operations, actual costs are higher than theoretical costs.

A variance of 1 to 2 percent is generally considered normal.
A higher variance usually indicates inefficiency, waste, or loss.

Common Causes of Food Cost Variance

Portion creep: Gradually serving bigger portions can quietly drive up your costs over time.
Recipe drift: Staff might stray from the original recipe, leading to inconsistency and higher costs.
Waste and spoilage: Ingredients can spoil or expire during preparation.
Theft or unauthorized use: Inventory can mysteriously shrink for reasons that slip under the radar.
Inaccurate recipe costing: Relying on old prices or wrong quantities can quietly introduce costly errors.

Why Tracking Food Cost Variance Matters

If you do not track both theoretical and actual food costs, the gap between them stays hidden in plain sight.

To measure it, you need:

Accurate recipe costing
Consistent inventory tracking

Many small business owners lack either of these systems, letting profit and loss slip by unnoticed until it hits their cash flow.

Example of Food Cost Variance

A café has:

Theoretical food cost: 29%
Actual food cost: 34%

That is a 5-percentage-point variance.

If the monthly ingredient spend is $8,000:

5% of $8,000 = $400 in lost profit per month $400 × 12 = $4,800 per year

This money quietly disappears, with no obvious warning signs, unless you keep an eye on your variance.

How Percy Plate Helps

Percy Plate does the heavy lifting for you, automatically calculating your theoretical food cost from your recipes and sales, then matching it against your actual ingredient spending.

This allows you to:

Instantly see your food cost variance
Identify where losses are occurring
Take action to reduce waste and improve margins

Learn more at https://www.percyplate.com.

FAQ: Actual vs. Theoretical Food Cost

What is theoretical food cost? Theoretical food cost is the expected cost of ingredients based on standardized recipes and sales volume, assuming perfect execution with no waste.

What is the actual food cost? Actual food cost is the real amount spent on ingredients, calculated using inventory and purchasing data over a specific time period.

What is a good food cost variance? A variance of 1-2% is typically acceptable. Higher variance suggests inefficiencies such as waste, over-portioning, or inaccurate costing.

Why is my actual food cost higher than theoretical? This usually happens due to portion creep, waste, spoilage, recipe inconsistencies, or untracked inventory usage.

How do you reduce food cost variance? You can reduce variance by standardizing portions, updating recipes, improving inventory tracking, minimizing waste, and regularly comparing theoretical vs. actual costs.

Related Guides

Why Your Food Costs Keep Creeping Up — Why food costs drift upward over time
How to Track Food Waste and Stop Losing Money — Waste tracking to close the gap
Free Food Cost Spreadsheet Template (And Why You Will Outgrow It) — Template to track actual vs theoretical
Restaurant Inventory Management: PAR Levels, Counting, and the System That Stops Waste — Inventory tracking that reveals variance

Stop guessing what your dishes cost.

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