What Ingredients You Might Be Overpaying For (and How to Stop)

Running a restaurant is exciting, but it isn’t easy. Every day brings new challenges, and with so much on your plate, finding the balance between delighting customers and keeping finances in check can feel overwhelming. 

So how do you make sure your hard work translates into lasting profitability? The truth is, running a successful restaurant requires more than great food and service—it also demands careful attention to the bottom line. In a fast-paced industry with tight margins, every dollar spent on labor, food, and overhead impacts your ability to reinvest, grow, and stay competitive.

Staying on top of your expenses is the key to maintaining healthy profits. On average, typical restaurant expenses break down to the following revenue percentages:

• 30 percent: labor and insurance costs
• 25 to 40 percent: food costs
• 5 to 10 percent: utilities and rent

Food costs represent a significant portion of your spending, and are variable depending on the season, supply-chain interruptions, and inflation. By tracking your ingredient prices frequently, you can reveal overpriced items and provide profit-preserving solutions.

Is Your Restaurant Overpaying for Ingredients? 

Restaurants are no strangers to navigating fluctuating food costs, but in recent years, there has been a trend toward higher-priced ingredients. In fact, ingredient costs are now 29 percent higher than pre-2020 prices. Awareness of these trends will help you prepare for potential cost increases and adjust your strategies accordingly.

However, there is an ebb and flow in which specific ingredients are increasing. For example, statistics in 2024 showed a steady increase in costs for popular restaurant staples compared to the previous year. 

• Beef Roasts: 11.2 percent
• Steaks: 7.2 percent
• Ground Beef: 6.2 percent
• Fresh Fruits: 8.2 percent
• Lettuce: 5.8 percent
• Tomatoes: 4.5 percent
• Pork (roast, steak, rib): 4.2 percent

In contrast, early 2025 saw a 6 percent price drop in tomatoes and lettuce. One way to think about overspending in a fluctuating market is that in one quarter, you might be right on track concerning tomatoes, and in the next quarter, you could be overspending. Simply put, the best way to determine if your restaurant is overspending is to do a thorough ingredient cost analysis and adjust often.

Understanding Ingredient Cost Control 

Calculating ingredient costs is essential to pricing a menu item for profit. A single menu item's food cost should include the total expense of all ingredients, including proteins, vegetables, spices, oils, and garnishes. Ingredient costs also need to be continuously updated based on market prices. 

Checking your food cost percentage is also important to see where your profit vs. expense margins could be off. 

Addressing Ingredient Cost Changes: Profitable Solutions 

Staying on top of ingredient costs and pivoting to avoid overpaying is easy with the right solutions.

Implement Proactive Pricing 

The best way to monitor pricing changes proactively is in real time. 

• Keep a diligent record of inventory and product usage. Stick to a regular inventory management schedule so that it becomes part of your routine operations. 

• Use technology to your advantage. Restaurant management systems (RMS), like Toast's cutting-edge POS, import invoices from your bulk food supplier, automatically adjust food costs, and provide immediate recipe adjustments.

Perform a Menu Audit 

Menu audits are essential to ensure your prime costs and profits are within ideal margins. Start by listing all menu items and calculating the cost of goods sold for each dish based on current pricing. Experiment with price points to reach ideal profitability per plate. 

Consider strategies to maximize ingredients while maintaining quality and profits.

• Incorporate seasonal items to curate seasonal menu options. Fresh vegetables and fruit are abundant during their prime, meaning reduced costs.
• Streamline costs by cross-using ingredients across multiple dishes. For instance, if you use a specific type of cheese in one dish, consider using it in another dish to reduce the variety of ingredients you need to stock.
• Stretch ingredients through fermenting, drying, or preserving to reduce food waste costs. 

Leverage Bulk Buying 

Bulk buying from a reputable supplier can help trim costs and enhance your restaurant's bottom line. 

• Restaurant supply warehouses work with established farms to get top-notch ingredients and great prices, then pass the savings on to their culinary partners. 
• Bulk orders provide for larger quantities on hand, which helps to streamline stocking cycles and inventory turnover.

Explore Premium Products for Affordable Costs at CHEF’STORE

Whether you’re running a high-volume kitchen or just starting out with a food truck, CHEF’STORE offers the premium ingredients and professional-grade supplies you need to succeed, without breaking your budget. Our wide selection includes fresh produce, quality meats, dairy, dry goods, and kitchen essentials, all curated to meet the demands of busy foodservice operations.