Owlly

Management · 2026-10-10 · 10 min

How to lower food cost in your restaurant: 7 ways

Ingredient cost decides your restaurant's margin. Seven ways to lower it without compromising on quality.

Why food cost is the most important restaurant KPI

Food cost is the percentage of ingredient cost relative to dish selling price. In a full-menu restaurant it usually sits between 25% and 35%.

The problem is that food cost changes daily. Supplier prices fluctuate. Portions aren't perfectly standardised. Kitchen losses (waste, overproduction) grow unnoticed. Without a system tracking these changes as they happen, operators only learn about problems from the monthly P&L, when the money is already lost.

1. Define recipes (BOM) for every dish

You can't control food cost without recipes. A BOM (Bill of Materials) lists ingredients with exact quantities for every dish on your menu. Without a BOM, you don't know how much a single dish costs; you only know how much you spent on purchasing in total.

In Owlly, you create recipes in the Menu & Recipes module (the 249 zł plan). Owlly takes current ingredient prices from your invoices and calculates the real cost of every dish. When a supplier raises the price of flour by 15%, Owlly re-costs your pizza at the new price that night, and you see the price-rise alert in the morning.

2. Track supplier prices automatically

Do you know when your supplier raised olive oil from 24 zł to 27 zł per litre? Most restaurateurs don't, because nobody compares prices from the previous invoice.

Automatic supplier price monitoring means the system compares every line item price on a new invoice against the historical price. In Owlly that comparison runs every night, and in the morning you see the price rises ranked by the money at stake. You can then negotiate with the supplier, find an alternative, or adjust the dish price before the loss builds up.

3. Control portions and standardise preparation

The difference between 180g and 220g of fillet on a single dish is 22% more ingredient cost. Multiply that by 50 dishes sold per day and you have a serious margin leak.

Standard recipe cards with exact quantities, regular chef training, and scales at prep stations are fundamental. The BOM system helps because it shows the gap between theoretical cost (from the recipe) and actual cost (from purchase invoices). If the gap grows: portions aren't being maintained.

4. Use demand forecasts for purchasing

Buying "by feel" is one of the most common causes of food waste and inflated food cost. Demand forecasting based on historical data (day of week, weather, seasonality, events) lets you order exactly what you need.

On the 249 zł plan, Owlly forecasts each venue’s sales from the Owlly till’s sales, the weather, bookings, holidays and events in the city. After each forecast, draft orders to your suppliers are waiting for your approval.

5. Run regular inventory counts and compare to system data

System stock (what should be in the warehouse) vs. physical stock (what's actually there): the difference is your shrinkage. Without regular inventory counts, you don't know how much you're losing to theft, waste, delivery errors, and spoiled products.

A count on a phone, compared straight away against system data, shows where the variances are.

6. Negotiate with suppliers using data

When you have 6–12 months of every supplier's price history, automatically organised from invoices, negotiations become fact-based. You know exactly how much the price rose, when it rose, and how it compares to alternative suppliers.

7. Automate the entire cost data pipeline

Manually entering invoices into Excel, manually comparing prices, manually calculating food cost: all of this takes time and generates errors. In Owlly, the path from invoice to dish cost looks like this:

• Invoices from KSeF, an email inbox and a phone photo arrive in the system on their own • AI reads every line and matches it to your ingredients, and asks you about uncertain matches • Dish cost is computed from the prices on your invoices • You see price-rise alerts every morning • The manager sees current food cost without opening a spreadsheet

Invoices, prices and alerts start on the 149 zł plan; recipes and food cost are on the 249 zł plan.

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