A 70 per cent GP on a £3.20 plate is £12.80, not £10.67
Menu Price and GP Calculator
Plate cost and target GP in, menu price out, with the VAT that menu prices include and spreadsheets forget. Skip that step and 70 per cent quietly earns 64.
Menu Price and GP Calculator
From plate cost and target GP to the menu price, with the VAT that menu prices include and most spreadsheets forget.
The error this page exists to kill
Menu prices include VAT. GP is measured on the ex-VAT price. Divide the plate cost by one minus the GP and you have the ex-VAT price; forget to add the VAT back and the menu quietly gives a fifth of the revenue to HMRC twice.
Priced the forgotten way, a 70 per cent target earns about 64, and six points of GP on a busy dish is thousands of pounds a year.
GP percentages steer, pounds pay bills: a 65 per cent dish earning £9 of cash margin beats an 80 per cent dish earning £4. The Menu Engineering Workbook ranks the whole menu both ways.
Take the workbook
The same arithmetic in Excel for a whole menu: eight demo dishes, target GP each, the price that hits it and the GP your current prices really earn.
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