“Sep out your paper products, as they are not FOOD, but a cost of doing business (controlable costs)”
When you are in the delivery business, there is no difference at all between boxes and cheese (except that the box quantity does not vary by pizza maker LOL)
It comes down to how much time you want to spend working on this stuff and whether it provides a useful number. PP is right as far as a definintion of “food cost” goes. For me it is more useful to combine food, paper, supplies all in one number. Call it consumables cost if it makes you happier.
Knowing how much cleaning supplies or paper plates and napkins I use as a separate % from food is not useful to me. I roll it all together. Occationally, I will carve out cheese and track it as an individual cost.
Dewar is right about “Prime Cost”. We track that monthly. With monthly sales that swing from 25K to 110K based on season, our monthly performance on this metric is all over the map, but on a full year basis we are a little under 60% (not counting owner comp since we don’t work in the store)
The reason I do it food cost with the check book is that it saves me a lot of time. We do a detailed food cost monthly not weekly. (If the number starts to wander we go to weekly) I can flip through the check stubs and add up those costs a lot faster than going through the old invoices. By netting out the effect of unpaid invoices I do not have to check the delivery dates. I certainly do not run through the US Food and Sysco invoices splitting out supplies! I can finalize the monthly food cost with the inventory the manager does in about 5 minutes the way I do it. If I ran through all the invoices and tallied up the things to subtract, checked the delivery dates etc etc it would take an hour and would give me a number that was NO MORE USEFUL than the one I get doing it my way.
There is no end whatsoever to the amount of time you can spend on looking at numbers. I find them fascinating… BUT, not all of them are useful or useful enough for the time spent generating them.
People on this forum have asked how I run this business in 5 hours a week. This is one of them. At a half hour in the mornings, I spend about as much time on this forum than I do in my two stores.