Free delivery isn't actually free - someone's paying, and that someone is you. Most restaurant owners think offering free delivery just means absorbing a €2-3 fee, but they're missing hidden costs that can slash profit margins by 50% or more. Here's how to calculate the real impact and protect your bottom line.
What does free delivery really cost?
Free delivery doesn't eliminate costs - it shifts them to you. And there are more costs than most owners realize:
- Platform fees: Thuisbezorgd, Uber Eats charge 15-30% commission
- Delivery costs: €2-4 per order that normally the customer pays
- Packaging costs: Containers, bags, cutlery, napkins
- Extra time: Packing, labeling, preparing for delivery driver
💡 Example:
Margherita Pizza - normal situation:
- Selling price: €12.00
- Customer pays delivery: €2.50
- Platform commission (20%): €2.40
- Packaging: €0.30
Net revenue: €12.00 - €2.40 - €0.30 = €9.30
Impact of free delivery on your profit
Offering free delivery means you absorb the delivery fee. This directly hammers your profit margin per order.
💡 Example - same pizza with free delivery:
Margherita Pizza - free delivery:
- Selling price: €12.00
- Platform commission (20%): €2.40
- Packaging: €0.30
- Delivery (you pay): €2.50
Net revenue: €12.00 - €2.40 - €0.30 - €2.50 = €6.80
The damage: €9.30 - €6.80 = €2.50 less profit per order. And that's something most kitchen managers discover too late - after they've already committed to free delivery promotions that eat through their monthly targets.
⚠️ Watch out:
With a food cost of 30%, you've got about €3.60 margin on a €12 pizza. Free delivery can slice that margin in half.
Three ways to compensate for free delivery
You can offer free delivery without killing your profits. Here are the three strategies that actually work:
1. Increase minimum order value
Set a minimum order threshold where the extra revenue covers your delivery costs.
💡 Calculation:
Delivery costs: €2.50
Average margin: 25%
Required extra revenue: €2.50 / 0.25 = €10
Set minimum at €25 instead of €15 = problem solved
2. Slightly increase delivery prices
Bump all prices on delivery platforms by €1-2. Customers rarely notice this since they're comparing with other delivery restaurants, not your dine-in menu.
3. Special delivery menus
Create delivery-specific menus with higher-margin items. Focus on dishes that travel well and need minimal packaging.
Calculation example: impact on a monthly basis
Here's how free delivery hits your monthly bottom line:
💡 Monthly calculation:
Restaurant with 200 delivery orders per month:
- Loss per order: €2.50
- Orders per month: 200
- Total loss: €2.50 × 200 = €500
Per year: €500 × 12 = €6,000 less profit
That's serious money you can save by using one of these compensation strategies. Tools like KitchenNmbrs can help you track these costs automatically and see exactly how delivery promotions affect your margins.
How do you calculate the impact of free delivery? (step by step)
Calculate your current profit per order
Subtract from your average order value: platform commission, packaging costs, and food cost. This is your current profit per delivery order.
Add the delivery costs
Check what customers currently pay for delivery (usually €2-4). This is the amount you'll pay instead of the customer.
Calculate the monthly impact
Multiply the loss per order by your number of delivery orders per month. This gives you the total impact on your monthly profit.
✨ Pro tip
Track your delivery costs for exactly 30 days before offering any free delivery promotions. Most restaurants underestimate their true delivery costs by 40-60% because they forget to include packaging, extra labor time, and higher platform commissions on promotional orders.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
Was this article helpful?
Frequently asked questions
Should I include VAT in this calculation?
No, always calculate excluding VAT. Platform commissions are calculated on pre-VAT amounts, so use those figures for accurate results.
What if I get more orders because of free delivery?
You need to calculate your break-even point. With €2.50 loss per order and €3 profit per order, you need roughly 1 extra order for every 1.2 existing orders to break even.
Can I offer free delivery only on certain days?
Absolutely - that's smart strategy. Offer free delivery on slow weekdays to boost volume, then charge normal delivery fees on busy weekends when demand is already high.
How do I know if my minimum order value covers delivery costs?
Calculate how much extra margin you need. With 25% profit margin, you need €10 extra revenue to cover €2.50 in delivery costs.
What happens if my average order value is already below the break-even point?
You'll need to either raise prices across the board or focus on upselling customers to higher-value orders. Consider bundling items or promoting premium dishes.
Do packaging costs vary significantly between different menu items?
Yes, dramatically. Soups and saucy dishes need expensive leak-proof containers, while sandwiches use cheap paper wrapping. Factor this into your delivery menu design.
Should I track delivery profitability separately from dine-in sales?
Definitely. Delivery has different cost structures and margins than dine-in service. Track them separately to make informed decisions about promotions and pricing.
📚 Sources consulted
- EU Verordening 852/2004 — Levensmiddelenhygiëne (2004) — Official source
- EU Verordening 853/2004 — Hygiënevoorschriften voor levensmiddelen van dierlijke oorsprong (2004) — Official source
- EU Verordening 1169/2011 — Voedselinformatie aan consumenten (2011) — Official source
- NVWA — Hygiënecode voor de horeca (2024) — Official source
- NVWA — Allergenen in voedsel (2024) — Official source
- Codex Alimentarius — International Food Standards (2024) — Official source
- FSA — Safer food, better business (HACCP) (2024) — Official source
- BVL — Lebensmittelhygiene (HACCP) (2024) — Official source
- Warenwetbesluit Bereiding en behandeling van levensmiddelen (2024) — Official source
- WHO — Foodborne diseases estimates (2024) — Official source
Food Standards Agency (FSA) — https://www.food.gov.uk
The HACCP standards shown in this application are for informational purposes only. KitchenNmbrs does not guarantee that displayed values are current or complete. Always consult the FSA or your local authority for the latest regulations.
Written by
Jeffrey Smit
Founder & CEO of KitchenNmbrs
Jeffrey Smit built KitchenNmbrs from 8 years of hands-on experience as kitchen manager at 1NUL8 Group in Rotterdam. His mission: give every restaurant owner control over food cost.
Selling food? Then you need KitchenNmbrs
Whether you run a restaurant, food truck, catering company, or meal kit business — you need to know what each dish costs. KitchenNmbrs gives you that insight. Start your free trial.
Start free trial →