A food truck's menu keeps a wide margin on food: a carne asada taco costs $0.95 in tortillas, meat, toppings, foil and the card fee, and sells for $3.50, a 73% margin. What the truck has to pay for out of that margin is everything that isn't food: wages, the commissary, propane, permits and the truck itself. So the margin that matters is on the whole month, and the mix of items in it. Drinks keep the most of each sale, and catering keeps less a plate but sells fifty at once. Margin = (price − cost) ÷ price. In the example below, a month of five items brings $24,100 of sales and about $17,720 of gross profit, before wages and the truck's other costs.
The short version
- Margin = (price − cost) ÷ price; markup = (price − cost) ÷ cost.
- A taco: $0.95 in food, foil and fees, sold for $3.50, 73%.
- Wages, commissary, propane and permits come out of the gross profit.
- Drinks keep the most of each sale.
- Catering keeps less a plate and sells many at once.
- TaroStack costs each taco from what each batch used. More below.
A taco, costed
La Esquina Taco Truck, the made-up taco truck in San Antonio, Texas, I use in these examples, counts its wages as a fixed cost in its plan, so the costs below are what each item uses:
| A carne asada taco | Cost |
|---|---|
| Tortillas, meat and toppings | $0.79 |
| Foil or paper | $0.05 |
| Card fees, 3% of $3.50 | $0.11 |
| Cost | $0.95 |
The truck's year is in taco truck business plan, and the taco's price in how to price tacos.
Margins by channel
| Product | Sold where | Price | Cost | Gross profit | Margin |
|---|---|---|---|---|---|
| Carne asada taco | The window | $3.50 | $0.95 | $2.55 | 73% |
| Carne asada burrito | The window | $11.00 | $2.90 | $8.10 | 73.6% |
| Quesadilla | The window | $9.00 | $2.10 | $6.90 | 76.7% |
| Agua fresca | The window | $4.00 | $0.70 | $3.30 | 82.5% |
| Taco bar for 50 | Catering, invoiced | $750.00 | $260.00 | $490.00 | 65.3% |
The agua fresca keeps 82.5%, on 38 cents of fruit, sugar and water; the taco bar keeps 65.3%, invoiced with no card fee.
A month's numbers
A busy month for La Esquina:
| Product | Units | Sales | Gross profit |
|---|---|---|---|
| Carne asada taco, the window | 3,000 | $10,500 | $7,665 |
| Carne asada burrito, the window | 500 | $5,500 | $4,050 |
| Quesadilla, the window | 300 | $2,700 | $2,070 |
| Agua fresca, the window | 600 | $2,400 | $1,980 |
| Taco bar for 50, catering | 4 | $3,000 | $1,960 |
| Month | $24,100 | $17,725 |
The tacos bring the most gross profit by far, and the burritos come second. The truck's wages, commissary, propane and permits are $14,030 of fixed costs each month in its plan, so a month like this one is profitable and a rainy one may not be. Each agua fresca sold with a taco adds about $3.30. What a good food cost looks like is in what is a good food cost percentage.
Get the calculator
Download the food truck margin calculator. One sheet: one line for each product and channel, with its price, materials, packaging, labor and fee rate; the cost, gross profit, margin, markup and the price your target margin needs fill in. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.
Where this stops working
The calculator holds one cost per item. Beef that rose 40 cents a pound, a heavier hand on the meat, and tortillas thrown out at close change every taco's margin, and only the batch records show it.
How TaroStack does it
TaroStack costs each taco from what each batch used, so margins sit on real cost.
True cost from the batch. Each batch takes beef, tortillas and produce at the price of the deliveries they came from, so a price rise shows in the next batch's cost.
Labor on the batch. The minutes a batch took are recorded on it, so the hours behind each product are on record.
Margins by product. Margins are reported per product on that actual cost, and a price-creep report per supplier shows whose prices moved.
| The job | Spreadsheet | In TaroStack |
|---|---|---|
| What a taco cost | One price from last season | Cost from the batch's deliveries |
| The hours behind a batch | Remembered | Labor minutes on the batch |
| An ingredient creeping up | Noticed late | A price-creep report |
| Margins by product | Re-worked by hand | Margins on real cost |
Recipes, batches, costing and margin reports are on every plan, from $49 a month. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.