If you're looking for a Restaurant Profit Margin Calculator that helps you analyze your revenue, expenses, and determine your restaurant's financial health, you're in right place. This calculator is specifically designed for budgeting, financial planning, identifying areas for improvements, and giving you insights into your overall restaurant performance.
In this guide, we are going to cover the following topics:
A restaurant profit margin calculator is an online tool that tells you how much profit your restaurant is generating after covering all operating expenses. It shows you what portion of your revenue remains as profit after paying for drinks, food, labor, rent, utilities and other expenses.
Our calculator makes the restaurant profit margin calculation easy. Let's discuss the basic formula used in the calculator.
Profit Margin % = ( Profit / Revenue ) x 100
Where:
Profit = Revenue - Total Expenses
Revenue = The total income generated from restaurant services like food, drinks, and other services.
Total Expenses: The sum of all expenses including food cost + labor cost + beverage cost + rent and utilities + and other expenses.
Example:
Suppose you're the owner of a restaurant, and your monthly financials look like this:
50,000 dollars12,000 dollars4,000 dollars15,000 dollars4,000 dollars3,000 dollarsLet's compute those values to calculate profit margin:
Step 1: Calculate Total Expenses
Total Expenses = 12,000 + 4,000 + 15,000 + 4,000 + 3,000 = 38,000 dollarsStep 2: Calculate Profit
Profit = 50,000 − 38,000 = 12,000 dollarsStep 3: Calculate Profit Margin
Profit Margin % = ( 12,000 / 50,000 ) x 100 = 24%So, the calculated profit marging percentage is 24%, which is a great and well above from the industry average of 3% to 5%.
| Expense Category | Industry Average (%) |
|---|---|
| Food Cost | 28%–32% |
| Beverage Cost | 18%–24% |
| Labor Cost | 25%–35% |
| Rent & Utilities | 5%–10% |
| Profit Margin | 3%–5% |