1. Using Standardized Recipes to Determine Standard Portion Cost3
Controlling Foodservice Costs
OH 3-1

2. Chapter Learning Objectives
Explain why a standardized recipe is important for cost control and product consistency.
Describe information included in a standardized recipe.
Compare “as purchased” and “edible portion” methods in determining the cost of recipe ingredients.
Develop a recipe cost card using a standardized recipe.
Instructor’s Notes
Indicate that these objectives (competencies) drive the information in the chapter and in this session.
Ask the following questions, “How important is ‘consistency’ to you when you are personally selecting a restaurant?” “Who is most responsible for ensuring product and service consistency in a restaurant?”

3. Standardized Recipes Ensure Consistency In
Ingredient quality
Preparation method
Portion size
Service method
Instructor’s Notes
Remind students that inconsistent food can be one of a restaurant’s greatest problems, and the consistent use of standardized recipes helps to eliminate that problem.
Ask students to suggest what information should be listed on a standardized recipe.

4. Standardized Recipes Identify
Ingredient details (quality)
Ingredient weights and measures
Necessary equipment and tools
Volume (number) of portions
Instructor’s Notes
Explain the difference between a recipe’s stated volume (i.e., makes six quarts, yields ten pounds) and the number of portions the recipe will actually produce.

5. Standardized Recipes also Include
Preparation time
Storage and preparation information
Cooking method(s)
Instructor’s Notes
Ask why chefs are sometimes hesitant to standardize their personally developed recipes.
Explain that few recipes state the total time required to make the recipe because the skill level of food production workers varies greatly.
If time permits, ask students to write down a recipe of their own (in standardized format) that they can share.

6. Sample Standardized Recipe
Instructor’s Notes
Ask students to look for and identify each of the seven items listed on the previous two slides.

7. Standardized Recipes Allow for accurate purchasing
Help ensure compliance with “Truth In Menu” laws
Assists in training new employees
Makes it possible to “cost” the recipe accurately
Instructor’s Notes
Explain that guests, especially those with dietary concerns, often want to know about ingredients used in a recipe, and use of standardized recipes can yield this information.
Point out that computerization of the recipe costing process is impossible without standardized recipes.

8. Recipe Ingredient Costing Alternatives
As Purchased (AP) method
Price of an item before any trim or waste are considered
Example—unpeeled, whole potatoes
Edible Portion (EP) method
Price of an item after all trim and waste has been taken into account
Example—peeled, cubed potatoes
Instructor’s Notes
Explain that recipe costing is only possible with standardized recipes.
Ask for examples of items typically purchased in AP and EP market forms.

9. AP and EP
As Purchased (AP) refers to products as the restaurant receives them.
Edible Portion (EP) refers to products as the guests receive them.
Instructor’s Notes
Indicate that most food products are delivered to a restaurant in their AP state.
Ask students for examples of products purchased in an EP form. Examples: milk, wine and beer, and baked goods such as bread and buns.

10. Comparison of AP and EP Weights
Instructor’s Notes
Ask if the AP price of an item can ever be lower than its EP price. (Answer: if an item has zero trim loss, AP price can equal EP price, but AP price can never be lower than EP price.)

11. Managers Must
Determine if recipe ingredients are listed in AP or EP formats.
Apply the correct costing method to the ingredients.
Use the information to price menu items.
Periodically re-cost recipe ingredients.
Instructor’s Notes
Explain to students that the use of specifications will have the effect of reducing variation in the price paid for an item (among various suppliers) because each vendor will be supplying exactly the same item.
Explain that changing food suppliers may change the EP cost of some ingredients purchased by the restaurant because of differences in the newly supplied products
Yield
Price

12. EP Amounts
Because many food items shrink when they are cooked, managers must know exactly how much cooking loss to expect.
Instructor’s Notes
Explain that, even if foods are purchased cleaned and trimmed, water loss in foods is the inevitable result of applying heat (cooking) so there will often be reductions in food volume.
Explain that a yield test is a method of calculating the loss related to cooking and trimming, peeling and cleaning.

13. Ways to Estimate Yields
Butcher’s tests
To measure loss from deboning, trimming, and portioning meats, fish, and poultry
Cooking loss tests
To measure loss from the actual cooking process
Conversion charts
Tell the expected or average loss of an item from (AP) to (EP)
Instructor’s Notes
Explain that an AP product’s ultimate yield may vary based upon grade, age, storage techniques, and skill level of the cook preparing the food.

14. Creating Recipe Cost Cards
Step 1 – Copy the ingredients from the standardized recipe card to the cost card.
Step 2 – List the amount of each ingredient used.
Step 3 – Indicate the cost of each ingredient as listed on the invoice.
Instructor’s Notes
Point out that creating recipe cost cards has seven steps.
Explain that for the first step, you must list all ingredients, including spices, in the form they are used in the recipe, i.e., pounds, tablespoons, ounces, cups, and quarts.
Ask for examples of items that are purchased in one unit, but used in recipes in another unit. Example: Black pepper is usually purchased by the pound or ounce, but is often added to recipes by the tablespoon or teaspoon.
Inform students that conversions must often be made from the cost of an AP unit to the cost of an EP unit

15. Creating Recipe Cost Cards continued
Step 4 – Convert the cost of the invoice unit to the cost of the recipe unit.
Example
Milk purchased by the gallon for $2.80
Yields eight recipe-ready (EP) pints at $0.35 each. ($2.80 ÷ 8 pints = $0.35 per pint)
Instructor’s Notes
Assure that students understand that there are eight pints to one gallon.

16. Creating Recipe Cost Cards continued
Step 5 – Multiply the recipe unit cost by the amount required in the recipe.
Example
Recipe amount required—3 pints
Cost per pint—$0.35
Ingredient cost—$1.05 (3 pints x $0.35 per pint = $1.05)
Instructor’s Notes
Explain that the math skills required in this step are the same as those required for standardizing recipes and for taking physical inventories.

17. Creating Recipe Cost Cards continued
Step 6 – Add the cost of all ingredients.
Instructor’s Notes
Explain that, for some very low cost ingredients, like salt and minor spices, some managers estimate a fixed amount per recipe (i.e., one penny per portion or $0.25 per recipe) rather than listing the actual ingredient cost.

18. Creating Recipe Cost Cards continued
Step 7 – Divide the total recipe cost by the number of portions produced.
Example
Total recipe cost—$145.50
Total recipe yield—50 portions
Cost per portion—$2.91 ($ ÷ 50 portions = $2.91 per portion)
Instructor’s Notes
Remind students that recipe cards are used to determine portion costs.
Explain that all of the individual portion costs on a combination plate equal the plate cost.
Plate costs can include items such as entrée, vegetable, and starch, or even a full three or more course meal.
Explain that accurate portion or plate costs are needed to calculate a restaurant’s menu prices.

19. How Would You Answer the Following Questions?
The cost of most AP food products is higher than their EP cost. (True/False)
Which of the following is NOT true about recipe cost cards?
They help establish menu selling prices.
They reduce food production time.
There should be one for every menu item.
They inform managers about how much it costs to make a single portion of an item.
Software programs designed to help foodservice managers create recipe cost cards are readily available. (True/False)
Instructor’s Notes
Answers
False B
True
Note: indicate that the last part of this discussion will provide a review of definitions for the key terms used in the chapter.

20. Key Term Review As purchased (AP) method Butcher test Conversion chart
Cooking loss test
Edible portion (EP) method
Instructor’s Notes
As purchased (AP) method—used to cost an ingredient at the purchase price prior to considering any trim or waste
Butcher test—used to measure the amount of shrinkage that occurs during the trimming of meat products
Conversion chart—list of food items showing the expected, or average, shrinkage from AP amount to EP amount
Cooking loss test—way to measure the amount of product shrinkage during the cooking or roasting process
Edible portion (EP) method—used to cost an ingredient after it has been trimmed and waste has been removed so that only the usable portion of the item is considered
Note that there are additional key terms for this chapter.

21. Key Term Review Portion size Recipe cost card Shrinkage
Standard portion cost
Standardized recipe
Instructor’s Notes
Portion size—size of a menu item
Recipe cost card—tool used to calculate standard portion cost for a menu item
Shrinkage—amount of loss incurred when a product is trimmed and cooked, roasted, or otherwise prepared for service
Standard portion cost—exact amount that one serving or portion of a food item should cost when prepared according to the item’s standardized recipe that has been pre-costed with current purchase cost
Standardized recipe—lists the ingredients and quantities needed for a menu item, as well as the methods used to produce it and its portion size

22. Chapter Learning Objectives— What Did You Learn?
Explain why a standardized recipe is important for cost control and product consistency.
Describe the information included in a standardized recipe.
Compare “as purchased” and “edible portion” methods in determining the cost of recipe ingredients.
Develop a recipe cost card using a standardized recipe.
Instructor’s Notes
Ask students to do a personal assessment of the extent to which they know the information or can perform the activity noted in each objective.