Restaurant Profit Calculator

Profit = sales − food and drink cost − fixed costs. In the example: 150 guests × $30 × 30 days is $135,000. Food cost at 32% is $43,200. Fixed costs are $82,000. That leaves $9,800 a month. Divide profit by sales for the margin: $9,800 ÷ $135,000 is 7.3%.

Profit margin = profit ÷ sales × 100. Use net profit after all costs for the true margin. The example's margin is 7.3%. Gross margin, sales minus food cost only, is 68% here, but it ignores labor and rent, which are most of a restaurant's costs.

Full-service restaurants often net 3% to 6%. Quick-service and fast casual places often net 6% to 10%. Bars and places with high drink sales can do better. The example's 7.3% is healthy for a sit-down restaurant. Below 3%, one slow month can wipe out the year.

28% to 35% of sales is typical. Fine dining and steakhouses often run higher, while pizza and pasta places often run lower. Drinks usually cost less, so bars bring the average down. Each point of food cost on $135,000 a month is $1,350 of profit.

Prime cost is food and drink cost plus total labor, including taxes and benefits. Many operators aim to keep it at 60% to 65% of sales. If it runs above 70%, there's usually too little left for rent and profit. Check yours by adding food cost to the labor part of your fixed costs.

Divide monthly fixed costs by the profit on each guest after food cost. In the example, each $30 check leaves $20.40 after a 32% food cost. $82,000 ÷ $20.40 is about 4,020 guests a month, or 134 a day. The calculator shows yours.

Often $175,000 to $750,000, and far more for large or high-end spaces. Taking over a former restaurant with its kitchen in place costs much less than a new build-out. The example uses $375,000. Include equipment, furniture, permits, design, first inventory, pre-opening staff and 3 to 6 months of operating cash.

Many restaurants take 1 to 2 years to reach steady profit, and paying back the opening cost often takes 3 to 5. The example pays back in about 3 years 3 months. Many restaurants close within the first few years, often because sales never reach break-even.

Owners of small restaurants often make $40,000 to $100,000 a year, and many make less in early years. In the example, the restaurant makes $9,800 a month, or $117,600 a year, before income tax and loan payments. For a 60-hour week, that works out to about $38 an hour.

Raise the average check with menu design, specials and drinks. Cut food cost with portion control, waste tracking and supplier bids. Schedule labor to match traffic. Add takeout, catering or private events to use the kitchen at slow times. In the example, a $5 higher average check more than doubles monthly profit.