How to Price Restaurant Menu Items in the UK

Pricing your restaurant’s menu is one of your most powerful tools for balancing profitability, sustainability, and customer satisfaction. Whether you run a pub in Leeds or a fine dining venue in London, this guide will walk you through how to build and implement a restaurant menu pricing strategy tailored to your audience, operations, and financial goals.

Why Menu Pricing Strategy Matters

Menu pricing affects your bottom line in ways that go beyond margins. According to the Toast Consumer Preferences Survey 2025, in which 200 UK diners were surveyed about restaurant pricing and value, 45% of UK diners say they’re “somewhat likely” to avoid a restaurant if they suspect overpricing, and only 10% say price has little or no effect on restaurant choice. 

As UK consumers become more selective due to rising living costs, they’re also more supportive of pricing transparency. In fact, 64% of consumers would support a restaurant more if it openly shared sustainability and cost management practices. 

Understanding the Numbers: COGS, Food Cost %, and Break-Even

Before setting prices, you need to understand your cost of goods sold (COGS), food cost percentage, and break-even point. These metrics help determine how much you must charge to stay afloat and when you start making a profit.

Here are the essential formulas:

• COGS = Beginning Inventory + Purchases – Ending Inventory

• Food Cost % = COGS ÷ Food Sales

• Break-Even Point = Total Fixed Costs ÷ [(Total Sales – Total Variable Costs) ÷ Total Sales]

Popular Menu Pricing Models in the UK

According to our consumer data, UK diners tend to prefer transparent, value-driven pricing. The most preferred models include:

• Prix Fixe (Fixed Price) – preferred by 37.5% of respondents

• Promotion-heavy – 30.5% favour menus with deals

• A la carte – selected by 18.5%

Adapt your pricing model to fit your guest expectations and concept. A fast-casual venue in Birmingham may thrive with combo offers, while a chef-led tasting menu in Edinburgh might suit a fixed-price approach.

Strategic Steps to Set Menu Prices

1. Calculate Real & Ideal Food Costs

Use recipe costing tools and track supplier invoices regularly with invoice automation software.

2. Set a Maximum Allowable Food Cost (MFC)

Common benchmarks fall between 28–35%. Use the MFC formula: MFC = 100 – ((Labour + Overheads + Profit Goal) ÷ Total Sales)

3. Price Based on Value, Not Just Costs

Remember: diners assess value based on service, ingredient quality, and portion sizes — not just the price tag.

Menu Engineering & Psychology Tips

Smart design plays a key role in your pricing strategy:

• Drop currency symbols to reduce “sticker shock”

• Highlight high-margin items in prime real estate (top-right corner)

• Bundle items for perceived value

• Use whole numbers instead of decimals (e.g. £14 vs £13.99)

Final Thoughts

Pricing your menu isn’t just about covering costs. It’s about telling the story of your food, showing customers what you stand for, and making sure your business stays healthy. 

When you take the time to build a thoughtful pricing strategy — one that reflects your values, your goals, and what your guests care about — your menu becomes more than a list of dishes. It becomes a tool for growth, connection, and long-term success.