Foodservice directors, who often control one of the largest cost centers in the hospital, are being challenged to manage resources more effectively. Capital budgeting techniques can help enhance a department's cost-effectiveness. The purpose of this study was to assess the use by foodservice directors in nongovernment, not-for-profit and investor-owned, for-profit hospitals of capital budgeting techniques such as payback period, average accounting rate of return, net present value, profitability index, and internal rate of return. Data collected from 84 directors included their use of capital budgeting techniques and operational information about their department. Results indicated that not-for-profit hospital foodservices had significantly more full-time equivalent employees than for-profit hospital foodservices--means of 66 and 52, respectively. Size of capital budget was not strongly correlated with any of the operational variables measured. Many of the directors in both types of hospitals used some capital budgeting techniques. However, directors in for-profit hospitals were much more likely than those in not-for-profit hospitals (92% vs 72%) to use capital budgeting techniques.