With packages containing both food and beverages, you calculate the margin differently than with individual dishes. You're dealing with different VAT rates (9% for food, 21% for alcohol) and different purchasing methods. In this article you'll learn step-by-step how to correctly calculate the total margin of a package.
The difference between food and beverages
With packages you combine products with different characteristics:
- Food: 9% VAT, often prepared from ingredients
- Soft drinks: 9% VAT, usually purchased per bottle/glass
- Alcoholic beverages: 21% VAT, purchased per bottle/glass
- Coffee/tea: 9% VAT, calculated per serving
Each component has its own cost price and margin. The trick is to combine these into one complete picture.
💡 Example package:
3-course menu + aperitif + wine + coffee for €65.00
- 3-course menu: €18.50 cost (9% VAT)
- Aperitif: €3.20 cost (21% VAT)
- Wine with dinner: €8.50 cost (21% VAT)
- Coffee: €0.85 cost (9% VAT)
Total cost: €31.05
Step 1: Break down the package
Start by breaking down your package into different components. Note for each component:
- The cost price
- The VAT rate (9% or 21%)
- The product type (food, alcoholic beverage, non-alcoholic)
This gives you an overview of what you're selling and what each component costs.
Step 2: Calculate the selling price per component
You need to distribute the total selling price (€65.00) across the components. You usually do this based on relative value:
💡 Distribution based on cost:
- Menu: €18.50 / €31.05 = 59.6% → €38.74
- Aperitif: €3.20 / €31.05 = 10.3% → €6.70
- Wine: €8.50 / €31.05 = 27.4% → €17.81
- Coffee: €0.85 / €31.05 = 2.7% → €1.75
Check: €38.74 + €6.70 + €17.81 + €1.75 = €65.00 ✓
⚠️ Note:
You can also choose a different distribution, for example based on standard prices. What's important is that you're consistent and the total price is correct.
Calculate the margin per component
Now calculate the margin per component. Remember to work with prices excluding VAT:
💡 Margin calculation per component:
Menu (9% VAT):
- Selling price excl. VAT: €38.74 / 1.09 = €35.54
- Margin: €35.54 - €18.50 = €17.04 (47.9%)
Aperitif (21% VAT):
- Selling price excl. VAT: €6.70 / 1.21 = €5.54
- Margin: €5.54 - €3.20 = €2.34 (42.2%)
Calculate total margin
You calculate the total margin by adding all margins together and dividing by the total selling price excluding VAT:
Formula:
Total margin € = Sum of all margins in euros
Total margin % = (Total margin € / Total selling price excl. VAT) × 100
💡 Total calculation:
- Menu margin: €17.04
- Aperitif margin: €2.34
- Wine margin: €6.48
- Coffee margin: €0.75
Total margin: €26.61
Total selling price excl. VAT: €58.19
Margin %: (€26.61 / €58.19) × 100 = 45.7%
Handling different VAT rates correctly
When calculating the total selling price excluding VAT, you need to treat each component separately:
- 9% VAT products: Divide by 1.09
- 21% VAT products: Divide by 1.21
- Add all amounts excl. VAT together
⚠️ Note:
NEVER calculate the total selling price excluding VAT by dividing €65.00 by one VAT rate. You have different rates, so you need to calculate each component separately.
When is your margin healthy?
Different benchmarks apply to packages than to individual dishes:
- Total margin 40-50%: Healthy for most packages
- Below 35%: Possibly too little margin, check your pricing
- Above 55%: Excellent, but check if you're still competitive
Beverages often have a higher margin than food, so packages can have a better total margin than food alone.
How do you calculate the margin on a package? (step by step)
Break down the package into components
Make a list of all components (food, beverages, coffee) with their cost prices and VAT rate. This gives you an overview of what you're selling.
Distribute the total price across components
Distribute your selling price (for example €65) across the components, often based on their relative cost value. Check that the total is correct.
Calculate the selling price excluding VAT per component
Divide each component by the correct VAT rate (1.09 for 9% VAT, 1.21 for 21% VAT). Add all amounts excl. VAT together.
Calculate the margin per component
Subtract the cost price from each selling price excl. VAT. This gives you the margin in euros per component.
Calculate the total margin
Add all margins in euros together and divide by the total selling price excl. VAT. Multiply by 100 for the percentage.
✨ Pro tip
Check your 3 best-selling packages every quarter. If those are good on margin, you have 80% of your revenue under control. With a system like KitchenNmbrs you see the margin of each package directly without manual calculations.
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 margin calculation?
No, always calculate your margin based on prices excluding VAT. VAT is money you pass on to the tax authorities, not part of your profit.
How do I distribute the total price across food and beverages?
Usually based on the relative cost value of each component. You can also choose a distribution based on standard market prices, as long as you're consistent.
What if I have different VAT rates in one package?
Calculate each component separately with its own VAT rate. Never divide the total price by one average VAT percentage, that gives incorrect results.
Is 45% margin on a package good?
Yes, that's a healthy margin. For packages 40-50% is standard, because beverages often have a higher margin than food alone.
How often should I check my package prices?
Check at least quarterly whether your cost prices are still correct. Suppliers regularly raise prices, especially for beverages and specialty items.
Can I use different margins per component?
Yes, that's normal. Beverages often have a higher margin (50-70%) than food (30-40%). What's important is that your total margin stays healthy.
📚 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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