Costs of Different Menu Items Week 5 Lec . 4

1. Costs of Different Menu ItemsWeek 5Lec. 4 Menu Planning and Design (HM 431) - Fall 2013

2. Learning Outcomes • Develop a cost card from a standardized recipe, including a conversion of invoice costs into recipe costs. • Describe the difference between as purchased (AP) and edible portion (EP). • Calculate the cost of a complete meal. • Calculate the cost of a salad bar or an “All You Can Eat” buffet. Menu Planning and Design (HM 431) - Fall 2013

3. Introduction • One of the most important functions of menu planning is charging the correct amount of money for items listed on the menu. • Failure to do so results in a selling price that is too high or too low. • In order to determine the correct selling price, it is imperative that the exact costs be known.

4. STANDARDIZED RECIPES • They control the quantity and quality of ingredients used. • Control the portions that are to be served • They are also a necessary tool in figuring the costs • There are two methods used to write standardized recipes. They a the AP method, which means “as purchased” and the EP method which stands for “edible portion”.

5. STANDARDIZED RECIPES • AP method: all ingredient quantities are listed on the standardized recipes in the form in which they are purchased. • EP method, all ingredient quantities are listed using the edible portion only of that particular ingredient.

6. Example • 200 g of onions, diced • 200 g of diced onions What is the different? And which is better?

7. Example • The EP method, in spite of being more time consuming for figuring costs, is the preferred method because it is more exact. If you give several cooks an onion to peel.. some remove only the skin, and some remove the skin along with one or two layers the onion. Thus, whereas everyone starts out with the same amount, the yield in each case is different. • To simplify matters, for those operations using the EP method, conversion charts are available to assist in determining costs. (as shown)

9. COST CARDS • The object of cost cards is to get an accurate cost per portion so that the proper selling price can be determined. • Cost Card Components: • Recipe (Amount – Unit) • Ingredients • Invoice (Cost – Unit) • Recipe (Cost – Unit) • Extension

11. Example • The first ingredient, frozen asparagus, costs $86.91 for a case of 12 2½-pound boxes. • Multiply the 12 boxes times 2½ pounds per box to get 30 pounds per case. • Divide the cost per case ($86.91) by the 30 pounds to get the cost per pound ($2.897). • The cost per pound, $2.897, is then multiplied by the amount of asparagus called for in the recipe (10 Pound) to be $28.97.

14. Costing Meat Items • Some items on the menu do not require cost cards. Listings such as roasts, steaks, or chops—in other words, single items listed—are figured individually. In the case of meats, in particular, the shrinkage and trim must be taken into account.

15. Costing Meat Items To figure the cost to serve on a roast follow these steps: • Determine the total cost as purchased (price per pound times the number of pounds equals the total cost AP). • After roasting and trimming (bones, fat, etc.), weigh the roast. The result is the saleable weight or EP (edible portion). • Divide the total cost as purchased by the saleable weight. The result is the cost per pound to serve. • Divide the cost per pound to serve by 16 (number of ounces in a pound). The result is the cost per ounce to serve. • Multiply the cost per ounce to serve times the standard portion size. The result is the cost per serving.

17. Costing Beverages • In addition to knowing how to determine the cost of recipes and meats, it is also important to know the methods of costing out beverages, as they have the highest markup of any item on the menu. • Types of Beverages: • Hot Beverages • Cold Beverages (Premix and Post Carbonated Beverages)

18. Costing Beverages; e.g. Coffee Cost • Multiply the number of gallons of water times 128 to get total ounces. • Multiply total ounces by 10% (water absorbed by the coffee grounds). • Subtract the loss from total ounces to get the net yield per urn of coffee. • Divide the net yield by the number of ounces served per cup to get the number of cups per pound. • Divide the cost per pound by the number of cups per pound. The result is the cost of coffee per cup. • Take the cost of cream and sugar per serving • Add the cream and sugar cost to the cost of the coffee per cup. • Multiply the net cost per cup times the average number of refills per customer plus the original cup

20. Cold Beverages costing • In investigating carbonated beverages, there are two types to consider—premix and postmix. • Premix is syrup and carbonated water mixed at the factory in 5-gallon cans or cartons. • Postmixis syrup and carbonated water mixed on location. • Postmix requires water, electricity, and a drain running to the unit and requires a larger investment in equipment. For these reasons, some operations opt for the premix even though the profit margin is lower.

21. Cold Beverages: eg. Premix Carbonated Beverages • Multiply 128 (the number of ounces in a gallon) times 5 (the number of gallons in a premix tank/box) to get 640 ounces (in a 5-gallon tank/box). • Divide the cost of the tank/box by 640 to get the cost per ounce. • Subtract the amount of ice displacement from the total ounces of the serving container to get net ounces of product served. • Multiply net ounces of product served by the cost per ounce to get net cost.

23. Cold Beverages: eg. Postmix Carbonated Beverages • Multiply 5 gallons of water by 5 gallons of syrup to get 25 gallons of water (5-to- 1 ratio). • Add the 5 gallons of syrup to the 25 gallons of water to get a 30- gallon yield per 5-gallon tank/box of syrup. • Multiply 30 gallons of product by 128 (number of ounces per gal- ion) to get total ounces of product per syrup tank/box (3,840). • Divide the cost per tank/box of syrup by 3,840 to get the cost per ounce of product. • Subtract the amount of ice displacement from the size of the serving container to get the amount of product served. • Multiply the amount of product served by the cost per ounce for product to get total cost.

25. SINGLE SERVICE ITEMS • Single service items yield one portion and have multiple ingredients in their makeup. • These include such items as sandwiches or appetizers. • E.g. Burger Sandwich: ( Minced Meat– Lettuce – Tomato – Mayonnaise – Pickle – Bread)

27. Costing Complete Meal There are four steps to this process: • The first step is to get a total cost of accompanying items that would be the same on all meals served. • The second step in the process is to figure the cost of the entree itself. • The third step is to figure any additional costs for each listing, such as an accompanying side dish or special garnish. • Finally the Q factor is added.

28. Q factor, This covers all the incidentals that have not been accounted for in the cost cards and includes such items as the salt and pepper on the table, crackers, steak sauces, and possibly butter. To obtain the Q factor, take the total amount for the incidentals, usually figured on a monthly basis, and divide by the number of customers served for that period. The result is the 0 factor and is usually a nominal amount anywhere from $0.05 to $0.25.

30. Buffets and Salad Bars Costing • The only way to get an accurate cost is via the inventory method.

32. homework • Questions 1. In your own words, define and explain the importance of the following terms: (a) standardized recipes (b) cost cards (c) AP (d) EP (e) Q factor 2. Figure the cost of a 5-ounce cup of coffee using a brew ratio of 3:1. Assume the coffee costs $3.25 a pound, cream $0.02 per serving, and sugar $0.02 per serving. No refills are given. 3. Explain to a new manager the method used to figure the cost per person of an all-youcan-eat buffet.

33. Assignment • Using the following data and recipe, complete the blank cost card provided, including the cost per portion.

35. Recommended Websites • http://www.ez-calculators.com/measurement-conversion-calculator.htm • http://www.cuisinecuisine.com/FoodConversions.htm#Food%20Conversion%20Calculator • http://allrecipes.com/ • http://www.delmonte.com/