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Food cost is not what you spent — it is what you used. Those are two very different numbers and confusing them is one of the most common mistakes food trailer operators make.

Here is the formula that runs everything in Food Shack Pro:

Opening Inventory + Purchases − Ending Inventory = Food Cost Dollars
Food Cost Dollars ÷ Net Sales = Food Cost %

These calculations assume accurate data entry. Results are only as reliable as the information you put in.

Your target is 25%. That means for every dollar coming in the door, 25 cents went toward the food and supplies that produced that sale. The remaining 75 cents covers your fixed costs — propane, insurance, event fees, loan payments — and what is left after that is your profit.

Here is the pattern every operator needs to understand:

Same amount of work. The only difference is your food cost percentage and your price. The higher your food cost percentage, the lower your profit on every single sale.

Fixed vs Variable Costs

Fixed costs stay the same whether you sell $10 or $10,000 — propane, insurance, licenses, loan payments, phone, commissary fees. The dollar amount never changes. But as your sales go up, fixed costs represent a smaller percentage of each dollar you earn. That is why growing sales matters even when food cost stays the same.

Variable costs grow with sales but stay the same percentage. Food cost is a variable cost. If your target is 25%, you spend $25 on food for every $100 in sales, $250 for every $1,000.

Breakeven

Your breakeven is the sales number where every bill is paid. Every dollar after breakeven is profit — minus the food and supplies it takes to generate that sale.

Fixed Costs ÷ (100% − Variable Cost %) = Breakeven Sales

You must know this number before you set a single price on your menu. Food Shack Pro calculates your breakeven automatically on the Pricing Settings page once you enter your fixed and variable costs.

The food cost percentages, profit calculations, and financial benchmarks in this training content represent general industry guidelines. Your actual results will vary based on your specific operation, market, and circumstances.