How do you calculate a restaurant's break-even point?

Divide your fixed costs by the share of each sale left after variable costs. With £30,000 of fixed costs a month and 33% of sales going on food, drink and card fees, 67p of every pound is left, so you break even at £30,000 ÷ 0.67 = £44,776 of sales a month, without VAT.

Are wages a fixed or a variable cost?

Both. Salaries and the minimum team you need to open the doors are fixed; extra shifts you add on busy days rise with sales. For a simple break-even, put the core team in fixed costs and keep the rota flexible above that.

Should I use sales with or without VAT?

Without. VAT is collected for HMRC, so use average spend and sales with VAT taken off. At the standard rate, divide a figure that includes VAT by 1.2.

What can I do if I am trading below break-even?

There are three levers: more covers, more spend per cover, or lower costs. Bookings and opening hours that match demand bring covers; pricing and add-ons lift spend; food cost, the rota and supplier terms bring costs down. Change one at a time so you can see what worked.

Restaurant break-even calculator

Add up the costs you pay however quiet it gets, set the share of each sale that goes on food, drink and card fees, and see the sales and covers you need before the restaurant makes a profit.

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An owner standing in the doorway of a newly finished dining room with every table set.

Example figures are filled in. Change any field to use yours.

Fixed costs a month

Rent and business rates

Core team wages

Salaries and the minimum crew, with employer on-costs.

Energy, water and waste

Loan and lease repayments

Everything else

Insurance, software, accountant, marketing.

Variable costs, as a share of sales

Food and drink cost

Card fees and other variable costs

Covers

Average spend per cover, without VAT

Days open a week

Covers you expect a week (optional)

Shows the profit or loss at that level.

Result

Covers a day to break even: 54; On 6 open days a week: 323 covers.
Break-even sales a week: £10,333
Break-even sales a month: £44,776
Fixed costs a month: £30,000
Contribution margin: 67.0%
Each extra cover adds: £21.44

All figures without VAT. Months are converted to weeks at 52 weeks over 12 months.

How the calculator works

Fixed costs arrive whether you serve ten covers or two hundred. Every sale first pays for its own food, drink and card fees; what is left over (the contribution) pays the fixed costs. Break-even is the sales at which the contributions add up to the fixed costs.

Contribution margin = 100% − variable costs as a % of sales
Break-even sales a month = fixed costs a month ÷ contribution margin
Break-even sales a week = monthly figure × 12 ÷ 52
Covers a week = weekly break-even sales ÷ average spend per cover

All figures are without VAT. VAT belongs to HMRC, so it never pays a bill.

Worked example

A 60-cover neighbourhood restaurant open six days a week:

Item	Figure
Rent and business rates	£6,500 a month
Core team wages, including on-costs	£18,000 a month
Energy, water and waste	£2,200 a month
Loan and equipment repayments	£1,200 a month
Insurance, software, accountant and other fixed costs	£2,100 a month
Fixed costs	£30,000 a month
Food and drink cost	30% of sales
Card fees and other variable costs	3% of sales

The contribution margin is 67%, so break-even is £30,000 ÷ 0.67 = £44,776 of sales a month, or £10,333 a week. At £32 average spend without VAT, that is 323 covers a week: 54 on each of six open days. Every cover above that adds £21.44 towards profit.

Fixed or variable?

Fixed: rent, business rates, salaries and the minimum team you need to open, insurance, loan repayments, software subscriptions, accountancy.
Variable: food and drink, card processing fees, packaging, delivery platform commission.
In between: extra shifts you add on busy days. Leave them out of fixed costs and judge them separately: an extra server on Saturday should pay for themselves in covers or spend.

Using the answer

Compare the daily break-even covers with what each service actually does. If quiet days sit well below it, look at opening hours, a set lunch or private hire before cutting prices. If even busy days struggle to reach it, the fixed costs are the problem, and rent, rates and the core team are where to look.

Frequently asked questions

How do you calculate a restaurant's break-even point?: Divide your fixed costs by the share of each sale left after variable costs. With £30,000 of fixed costs a month and 33% of sales going on food, drink and card fees, 67p of every pound is left, so you break even at £30,000 ÷ 0.67 = £44,776 of sales a month, without VAT.
Are wages a fixed or a variable cost?: Both. Salaries and the minimum team you need to open the doors are fixed; extra shifts you add on busy days rise with sales. For a simple break-even, put the core team in fixed costs and keep the rota flexible above that.
Should I use sales with or without VAT?: Without. VAT is collected for HMRC, so use average spend and sales with VAT taken off. At the standard rate, divide a figure that includes VAT by 1.2.
What can I do if I am trading below break-even?: There are three levers: more covers, more spend per cover, or lower costs. Bookings and opening hours that match demand bring covers; pricing and add-ons lift spend; food cost, the rota and supplier terms bring costs down. Change one at a time so you can see what worked.

Results are estimates for planning, based only on the figures you enter. They are not financial, tax or legal advice. The calculation runs in your browser and TablePort does not see or save the figures you enter.

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