Have you ever stared at your bill after a meal out and wondered how your total got so high? You’re not alone. That pasta dish you just paid $15 for probably cost the restaurant less than $2 to make. The truth is that restaurants rely on huge markups to stay in business. While we all know eating out costs more than cooking at home, some menu items have such outrageous markups that you might think twice before ordering them again. Next time you’re scanning a menu, keep an eye out for these wallet-draining culprits.
Pasta dishes that cost pennies to make
That tempting plate of fettuccine Alfredo on the menu for $14.99? It probably costs the restaurant less than a dollar in actual ingredients. Pasta is one of the cheapest foods to produce in bulk, with a few pennies worth of flour and water forming the base of dishes that command premium prices. Even when topped with basic sauces like marinara or Alfredo, the total cost rarely exceeds $1-2 per serving. What’s more shocking is that many restaurants don’t even make their pasta fresh—they’re using dried pasta that costs even less, yet charging as if it’s handmade by an Italian grandmother.
Restaurants know they can get away with these markups because pasta feels satisfying and even a bit fancy. The average profit margin on pasta dishes hovers between 65-70%, making them one of the biggest money-makers in the food industry. When you order that $16 spaghetti with meatballs, you’re actually paying mostly for the restaurant’s overhead costs—rent, staff wages, utilities—rather than the food itself. Next time you’re craving pasta, remember that a box of good quality pasta and jar of sauce from the grocery store costs about $5 total and can feed a family of four.
Fancy salads with a few leaves and dressing
When you order that $12 house salad, you might be shocked to learn it contains less than $2 worth of ingredients. Restaurants count on the fact that a pile of mixed greens topped with a few cherry tomatoes, cucumber slices, and a sprinkle of croutons looks substantial on a plate. Most of what you’re paying for is the illusion of healthy eating and the convenience of not having to wash and chop veggies yourself. Even “premium” salads with add-ons like grilled chicken or avocado rarely contain more than $3-4 worth of ingredients, yet they often appear on menus for $15-20.
The markup on salads is particularly high because they’re quick to prepare and the ingredients stay fresh for days. Restaurants can pre-portion most components and assemble them in minutes. The markup percentage on a basic salad often exceeds 350%, making them even more profitable than many meat-based dishes. What’s more, most restaurants use pre-made dressings that come in bulk containers rather than making them fresh. That little ramekin of ranch dressing costs the restaurant about 10 cents, yet it’s a key component of what makes the salad seem worth its menu price. You could easily make the same salad at home for a fraction of the cost.
Wine by the glass that empties your wallet
That glass of house wine you just paid $9 for? It probably came from a bottle that cost the restaurant about $10—total. Most restaurants charge the wholesale price of the entire bottle for just one glass, giving them an incredible profit on the remaining 4-5 glasses they’ll pour from the same bottle. The math gets even worse with more expensive wines, where you might pay $15-20 per glass for wine from a bottle that cost the restaurant $25-30. Many restaurants also use special pouring techniques or slightly smaller glasses to stretch each bottle even further, maximizing their profits at your expense.
The cheapest bottle on the wine list typically has the highest markup percentage, sometimes exceeding 400%. Restaurants know that many customers will choose the least expensive option, so they make sure it delivers the biggest profit margin. Even more surprising is that many restaurants serve house wines from boxes rather than bottles, further increasing their margins. While there’s nothing wrong with boxed wine quality these days, paying premium bottle prices for it might make you reconsider your order. If you’re dining with someone else, ordering a bottle instead of individual glasses will almost always save you money.
Breakfast items that cost next to nothing
Ever wonder why diners can offer those “$5.99 breakfast specials”? Because eggs, pancakes, and toast cost almost nothing to make. A two-egg breakfast with toast that costs you $8 contains ingredients worth about 75 cents. The markup is astronomical. Eggs cost restaurants around 15-20 cents each, even with recent price increases. A pancake, made from flour, milk, and eggs, costs about 30 cents in raw ingredients. Yet you’ll pay $8-10 for a stack of three. Basic breakfast foods like these require minimal skill to prepare and can be cooked in large batches, making them incredibly profitable for restaurants.
Breakfast items like omelets and French toast appear to offer value because they fill the plate, but their ingredient costs remain incredibly low. Most breakfast potatoes cost pennies per serving, yet they take up significant plate space and make meals seem more substantial. Coffee might be the worst offender in the breakfast category, with a markup often exceeding 500%. That $3.50 cup of regular drip coffee contains about 20 cents worth of beans. When you upgrade to specialty coffee drinks, the markup gets even worse. A $5 latte contains about 40 cents worth of ingredients. Next time you’re craving a big breakfast, remember that you could make the same meal at home for about one-fifth the cost.
Burgers with outrageous profit margins
That $15 burger on the menu has components that cost the restaurant about $3-4 total. Ground beef, even high-quality beef, is relatively inexpensive when purchased in bulk. A half-pound patty costs a restaurant approximately $1.50-2.00. Add a bun (20-30 cents), some lettuce, tomato, and onion (50 cents total), and you’re still looking at a very low food cost. Even with “premium” toppings like cheese, bacon, or avocado, the total ingredient cost rarely exceeds $4. Yet burgers routinely appear on menus for $12-18, and “gourmet” versions can reach $25 or more in upscale restaurants.
Burgers are consistently one of the highest margin items restaurants can offer, with markups often exceeding 300%. The perceived value of a burger is much higher than its actual cost. Whether you’re at a fast food chain or a sit-down restaurant, you’re paying a premium for convenience. Five Guys and Carl’s Jr. have been identified in recent studies as having some of the most overpriced burgers in the fast food industry. The cost difference becomes even more stark when you consider that making a similar burger at home would cost $2-3 per serving. Even with artisanal bread and high-quality beef, your homemade version would still be a fraction of the restaurant price.
Pizza slices that are mostly air and sauce
That $4 slice of pizza you grab for lunch has ingredients that cost about 50 cents. Pizza dough is just flour, water, yeast, and salt—pennies per serving. Add a thin layer of sauce (25 cents) and cheese (another 25-50 cents depending on quality), and you’ve got a complete slice. Even “loaded” pizzas with multiple toppings rarely exceed $1 in ingredient costs per slice. The markup on pizza is so high that it’s consistently ranked among the most profitable foods in the restaurant industry, with food costs typically representing just 15-20% of the menu price. This means restaurants are making 80-85% gross profit on every pizza they sell.
The economics look even worse when you order a whole pizza at a sit-down restaurant. A $20 large pizza from a chain like Domino’s might cost them $4-5 in ingredients. In Hawaii, customers pay nearly $19 for a medium cheese pizza from Domino’s—the highest in the nation. Even in states with lower food costs, pizza remains tremendously profitable. The beauty of pizza from the restaurant’s perspective is that it can be prepared in advance, requires minimal skill to assemble, and cooks quickly. When you factor in that most pizza restaurants use conveyor belt ovens that can cook multiple pizzas simultaneously with little oversight, the efficiency of production further increases profits.
Soft drinks and coffee with insane markups
The $3 soda you order with your meal costs the restaurant about 10-15 cents—and that includes the cup, lid, and straw. Fountain drinks have one of the highest profit margins of any item in the food service industry, with markups often exceeding 1,000%. Restaurants pay mere pennies for the syrup and carbonated water that make up your drink, yet charge premium prices because people expect to order beverages with their meals. Even more shocking is that free refills don’t hurt their bottom line much—the cost of the additional syrup is negligible compared to what you’ve already paid for the first serving.
Coffee follows a similar pattern, with a standard cup costing restaurants about 20-30 cents to produce, yet selling for $3 or more. Specialty coffee drinks have slightly higher ingredient costs but still boast massive markups. Your $5 latte contains about 40 cents worth of milk and espresso. Iced tea might be the worst offender—it costs pennies to make a gallon, which can serve 16-20 customers at $3 each. Bottled water is perhaps the most egregious example, with restaurants charging $3-4 for bottles that cost them less than 50 cents. Next time you’re eating out, consider asking for tap water instead—it’s free and often just as good as the bottled option.
Desserts that cost a fraction to make
That $8 slice of chocolate cake? It likely costs the restaurant about $1-2 to serve. Desserts rely on inexpensive base ingredients—flour, sugar, eggs, and butter—yet command premium prices on restaurant menus. What’s more, many restaurants don’t even make their desserts in-house. That “homemade” cheesecake is often delivered from a commercial bakery, where it’s made in giant batches at minimal cost. A whole cheesecake might cost a restaurant $20-25, yet they’ll sell it one slice at a time for $7-9 each, extracting $56-72 from a single cake. The economics make desserts incredibly profitable.
Ice cream desserts have even higher margins. A large scoop of premium ice cream costs restaurants about 50 cents, yet that simple ice cream sundae sells for $6-8. Adding a squirt of chocolate sauce and a dollop of whipped cream costs mere pennies but transforms a basic scoop into a “special dessert” worth charging extra for. According to restaurant workers, desserts often have the biggest markup on the menu, with profits of 70% or more being standard. Restaurants count on diners feeling like they’re treating themselves with dessert, making them less price-sensitive than they might be with main courses. The small portion sizes further disguise the massive markup you’re paying.
Don’t get me wrong—eating out is about more than just the food. You’re paying for the experience, the service, and not having to wash dishes. But knowing which items give you the least value for money can help you make smarter choices. Next time you’re ordering, maybe skip the soda, share a pasta dish, or save dessert for a special treat at home. Your wallet will thank you, and you’ll still enjoy the best part of eating out—not having to cook!
