What is Prime cost?

Prime cost is a restaurant's cost of goods sold (food and drink) plus its total labour cost. As the two largest controllable expenses, it is the most-watched number in restaurant finance, and many operators aim to keep it under 60% of sales.

Bhookly supplies the cost of goods figure from real recipes. Stock becomes a cost when it sells, not when it is bought, so the number does not swing on delivery days. One restaurant's day once showed minus 78% margin only because a delivery had landed. The profit and loss statement then runs from gross sales down to net profit, with running costs taken from the expense ledger.