Your break-even point is the minimum amount you need to sell per day to cover all your costs. Without knowing this figure, you won't know if a quiet day is still profitable or if you're losing money. In this article, you'll learn step by step how to calculate how much revenue you need at minimum.
What is your break-even point?
Your break-even point is the moment when your revenue equals your total costs. You're not making a profit yet, but you're not losing money either. Everything you sell above that is pure profit.
💡 Example:
Restaurant with monthly costs of €18,000:
- Rent: €4,500
- Staff: €8,000
- Energy: €1,200
- Insurance: €800
- Other costs: €3,500
Break-even per day: €18,000 / 30 days = €600 per day
Collect all fixed costs
Start by adding up all the costs you have to pay every month, regardless of how much you sell. These are your fixed costs:
- Rent and mortgage: Building, kitchen, terrace
- Staff: Gross salaries + employer contributions
- Energy: Gas, water, electricity averaged per month
- Insurance: Business, liability, inventory
- Subscriptions: Internet, phone, software, music
- Other costs: Accountant, cleaning, maintenance
⚠️ Important:
Do NOT include your ingredient costs. Those are variable - they go up and down with your revenue. Focus only on costs that stay the same every month.
Calculate your average food cost percentage
You also need money for ingredients. Calculate your average food cost over the past 3 months:
- Add up all ingredient costs from 3 months
- Add up all revenue from the same 3 months
- Divide ingredients by revenue and multiply by 100
💡 Example:
Past 3 months:
- Ingredient costs: €15,600
- Total revenue: €52,000
Food cost: (€15,600 / €52,000) × 100 = 30%
Calculate your break-even revenue
Now you can calculate how much revenue you need at minimum. Use this formula:
Break-even revenue = Fixed costs / (1 - Food cost %)
💡 Example:
With fixed costs of €18,000 and food cost of 30%:
- Break-even per month: €18,000 / (1 - 0.30) = €25,714
- Break-even per day: €25,714 / 30 = €857
You need to sell at least €857 per day to break even
Check if this is realistic
Compare your break-even with your actual performance:
- How many days per week are you open?
- What's your average revenue per day?
- How often do you hit your break-even?
If your break-even is higher than your average revenue, you need to take action. You can lower costs, raise prices, or attract more customers.
⚠️ Important:
This is your absolute minimum to avoid losing money. For a healthy business, you want to be at least 15-20% above your break-even to account for unexpected costs and profit.
Keep an eye on your break-even
Your break-even changes when your costs or food cost change. Recalculate it when:
- Rent increases or you sign a new lease
- You hire or fire staff
- Major price increases from suppliers
- New subscriptions or insurance policies
With a system like KitchenNmbrs, you can track your food cost automatically, so you always know where your break-even is without manual calculations.
How do you calculate your daily break-even? (step by step)
Add up all fixed costs
Make a list of all costs you pay every month: rent, staff, energy, insurance, subscriptions. Add everything up for your total monthly costs.
Calculate your average food cost percentage
Divide your ingredient costs from the past 3 months by your revenue from the same period. Multiply by 100 to get the percentage.
Use the break-even formula
Divide your monthly fixed costs by (1 - food cost percentage). The result is your minimum monthly revenue. Divide by 30 to get your daily break-even.
✨ Pro tip
Check every Monday morning whether you were above your break-even last week. That way you know immediately if you're on track and can adjust if things aren't going well.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
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Frequently asked questions
Should I include VAT in my break-even calculation?
No, calculate with amounts excluding VAT. Your revenue and costs are then comparable. VAT is a pass-through item that you remit to the tax authority.
What if my revenue varies a lot from day to day?
Then calculate your break-even per week or month. As long as you're above your break-even on average, you're safe. Quiet days are compensated by busy days.
How often should I recalculate my break-even?
At least every 3 months, or immediately when there are major changes like rent increases, new staff, or significant supplier price increases.
What if my break-even is higher than my average revenue?
Then you're losing money structurally. You need to lower costs, raise prices, or attract more customers. This is a warning signal you need to address immediately.
Should I include depreciation in my fixed costs?
For your daily management, you can leave out depreciation - you don't pay it in cash every month. Focus on costs you actually have to pay every month.
📚 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.
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