Skip to main content
CostLora
Menu
YOUR INPUTDERIVED results

Prime cost

For this calculator, prime cost is food-and-beverage cost plus the defined restaurant labor cost for the same period. Prime cost percentage divides that total by net food-and-beverage sales.

Calculator

Food and beverage cost of goods used in the same period. For this calculator, include food and beverage. Exclude paper, packaging, smallwares, labor, and occupancy.
One restaurant labor total for the same period. For this calculator, include hourly wages, overtime, salaries, manager pay on payroll, and employer payroll taxes. Employer-paid benefits include health premiums the employer pays. Workers' compensation premiums are included separately. Include owner pay only when it is wages or salary on payroll. Exclude owner draws, distributions, and unpaid owner time. Exclude customer tips. A service charge is included only when it is already in the payroll total you enter. Exclude rent, utilities, marketing, credit-card fees, repairs, and other insurance. This is not a CostLora or BLS wage.
Food and beverage sales for the same period. For this calculator, use the amount after discounts, comps, and refunds. Some restaurant budgets use gross sales before comps. For this calculator, comps are deducted from sales. This is a CostLora scope choice, not a statement that the other convention is invalid. Exclude sales tax collected for a government, merchandise, and other non-food-and-beverage revenue.

Prime cost percentage · DERIVED

—

Enter values to calculate.

Prime cost · DERIVED

—

Formula

Formula v1

Prime cost percentage = (Food and beverage cost + Labor cost) ÷ Net food and beverage sales × 100

Prime cost = Food and beverage cost + Labor cost

  • For this calculator, CostLora defines prime cost as food-and-beverage cost plus restaurant labor cost. Prime cost percentage is that sum divided by net food-and-beverage sales, multiplied by 100.
  • Food cost percentage uses food-only cost and food sales. Prime cost adds defined labor to food-and-beverage cost and uses food-and-beverage sales. One result is not an input to the other.
  • Labor included in the amount you enter: hourly wages, overtime, salaries, manager pay that is on payroll, employer payroll taxes, and employer-paid benefits, including health premiums the employer pays. Workers' compensation premiums are included. Owner pay is included only when it is wages or salary on payroll. A service charge is included only when it is already in the payroll total you enter.
  • Labor excluded: customer tips, owner draws, owner distributions, unpaid owner time, rent, utilities, marketing, credit-card fees, repairs, and other insurance. Employer-paid health premiums and workers' compensation are not part of that insurance exclusion.
  • CostLora labor pages are wage estimates from BLS occupational statistics and leave out benefits and payroll taxes. Those wage figures are not this labor input.
  • The percentage is the primary result. The dollar prime cost is the sum of the two cost inputs.
  • A percentage above 100 can occur from the amounts you entered. It is a reason to review those amounts. It is not a judgment about the restaurant.
  • Zero entered labor does not prove the restaurant had no economic labor cost. Unpaid owner time is not filled in by this calculator.
  • This example is arithmetic only. CostLora does not apply an industry target or benchmark.

Assumptions and data sources

No default assumptions: every value is your input.

Every amount is your input. Prime cost and prime cost percentage are derived from those amounts. The sources describe method and scope. They do not supply your numbers. The RestaurantOwner chart is a preliminary review copy, not the National Restaurant Association book.

Limitations

  • All three inputs should cover the same period. This calculator does not collect dates and cannot independently verify that the periods match.
  • For this calculator, food and beverage cost excludes paper, packaging, and smallwares. Some accounting systems put disposables inside cost of goods. This page does not claim those systems are wrong. If your total already includes paper or packaging, this calculator cannot detect that.
  • Not a tax return, not Form 1125-A, and not GAAP gross profit. Not a business health score.
  • This calculator does not audit payroll or inventory, does not use BLS wage estimates, and does not apply a target.
  • It does not divide labor by sales as a separate result.

Examples

  • Example: Food and beverage cost 6000, Labor cost 7000, Net food and beverage sales 22000 → Prime cost percentage 59.09%, Prime cost $13,000.00