Your revenue target determines whether your business survives. Many restaurant owners guess what they need to earn, but then work incredibly hard for nothing. Learn to calculate exactly how much revenue you need to cover costs and make profit.
Picture this: it's Tuesday afternoon and you're staring at an empty dining room, wondering if you'll make enough this month to cover rent. Most restaurant owners wing their revenue targets, then wonder why they're exhausted but broke. Here's how to calculate the exact number you need to hit every month.
First, gather your fixed costs
Your fixed costs hit every month regardless of covers served. These expenses don't budge based on business volume.
- Rent of your premises
- Salaries (including yourself)
- Insurance
- Energy (gas, water, electricity)
- Phone and internet
- Depreciation on equipment
- Accountant and administration
💡 Example fixed costs bistro:
- Rent: €3.500
- Salaries: €8.000
- Energy: €800
- Insurance: €400
- Other: €1.300
Total fixed costs: €14.000 per month
Calculate your variable costs percentage
Variable costs rise with your sales volume. More covers means higher ingredient costs, increased dishwashing, extra labor. Express this as a percentage so you can predict them accurately.
- Food cost: typically 28-35% of revenue
- Beverage costs: typically 20-30% of beverage revenue
- Variable staff: 5-10% of revenue (extra help during peak times)
- Dishwashing and cleaning: 2-3% of revenue
- Credit card fees: 1-2% of revenue
💡 Example variable costs:
At €30.000 revenue per month:
- Food cost (30%): €9.000
- Variable staff (8%): €2.400
- Other variable (5%): €1.500
Total variable costs: 43% of revenue
Determine your desired profit
Profit isn't optional. It's your cushion for equipment repairs, slow seasons, and expansion opportunities. Plus your actual return for risking everything on this business. Target at least 8-12% net profit.
⚠️ Heads up:
Many entrepreneurs don't count their own salary as a cost. Then it looks like they're making profit while actually working for free.
Apply the break-even formula
Now you can calculate your minimum revenue requirement. The math is straightforward:
Required revenue = Fixed costs / (1 - Variable costs % - Desired profit %)
💡 Example calculation:
Given:
- Fixed costs: €14.000
- Variable costs: 43%
- Desired profit: 10%
Calculation:
€14.000 / (1 - 0,43 - 0,10) = €14.000 / 0,47 = €29.787
You need at least €29.787 revenue per month
Translate to daily targets
Monthly numbers feel too abstract. Daily targets let you course-correct before it's too late. Divide monthly revenue by your operating days.
- Open 6 days a week = 26 days per month
- Open 7 days a week = 30 days per month
- Account for holidays and vacation
💡 Daily target:
€29.787 per month / 26 days open = €1.145 per day
This means at 80 covers per day an average bill of €14.31 per guest.
Check if your target is realistic
You know what you need to earn. But can you actually achieve it? Test your target against market reality. From tracking this across dozens of restaurants, there's a pattern we see repeatedly: owners calculate perfect targets but ignore what their location and concept can actually deliver.
- Seats × turnover rate × average bill
- How much can comparable businesses in your area earn?
- Does your average bill match your price level?
- Do you have enough parking and accessibility?
⚠️ Heads up:
If your calculated revenue exceeds what's realistically achievable, you need to cut costs or raise prices. Working harder alone won't bridge that gap.
How do you calculate your required revenue? (step by step)
Add up all your fixed costs
Make a list of all costs you pay every month, regardless of your revenue. Think of rent, salaries, insurance, energy and depreciation. Add everything up for your total fixed costs per month.
Calculate your variable costs percentage
Determine what percentage of your revenue goes to variable costs. Add food cost (28-35%), variable staff (5-10%), and other variable costs (5-8%). This gives you your total variable costs percentage.
Determine your desired profit percentage
Choose a realistic profit percentage, usually 8-12%. This is not a luxury but necessary for investments and a buffer. Don't forget to count your own salary separately as a fixed cost.
Apply the formula
Use the formula: Fixed costs / (1 - Variable costs % - Profit %). This gives you the minimum revenue you need to cover all costs and make a profit.
Translate to daily targets
Divide your monthly revenue by the number of days you're open for your daily target. Check if this is realistic by comparing it to your capacity and average bill per guest.
✨ Pro tip
Check your revenue against target every Tuesday and Friday morning - not just at month-end. This twice-weekly review gives you 8 chances per month to spot problems and adjust course before falling behind.
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 count my own salary as a cost?
Yes, absolutely. Many entrepreneurs forget this and think they're making profit while actually working for free. Count a realistic salary for yourself in the fixed costs.
What if my calculated revenue seems unrealistically high?
Then you have three options: lower costs, raise prices, or adjust your concept. Working harder doesn't solve the problem - the numbers have to add up.
What if I have seasonal fluctuations?
Then calculate your revenue per season separately. In good months you need to earn extra to compensate for slow months. Work with averages over the whole year.
How do I handle revenue targets when I'm planning menu changes?
Recalculate immediately after major menu updates since your food cost percentage will shift. Price changes can throw off your variable cost ratios by 3-5%, which impacts your minimum revenue requirement.
📚 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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