Break-even revenue is the amount you need to turn over at minimum to cover all costs. For ghost kitchens this is different than regular restaurants: no service staff and rent, but high platform fees and packaging costs. In this article you'll learn step-by-step how to calculate your break-even point.
What is break-even for a ghost kitchen?
Break-even is the point where your income equals your expenses. You make no profit, but also no loss. For ghost kitchens, the cost items are different than for regular restaurants.
💡 Example cost structure ghost kitchen:
- Kitchen space rent: €2,500/month
- Ingredients (food cost 30%): variable
- Staff: €4,000/month
- Platform fees (20%): variable
- Packaging (3% of revenue): variable
- Other costs: €1,500/month
Total fixed costs: €8,000/month
The break-even formula for ghost kitchens
The formula takes into account the unique cost structure of delivery kitchens:
Break-even revenue = Fixed costs / (1 - Variable costs %)
Where variable costs consist of:
- Food cost percentage (usually 28-35%)
- Platform fees (15-25% of order value)
- Packaging costs (2-4% of revenue)
- Variable staff during busy times
⚠️ Note:
Platform fees are calculated on the gross order value, not on your net proceeds. This makes your actual variable costs higher than you think.
Step-by-step calculation
We'll take the example from above and calculate the break-even point:
💡 Practical example:
Fixed costs per month: €8,000
Variable costs:
- Food cost: 30%
- Platform fees: 20%
- Packaging: 3%
- Total variable: 53%
Break-even = €8,000 / (1 - 0.53) = €17,021/month
Daily break-even
To determine your daily target, divide the monthly break-even by the number of working days:
Daily break-even = Monthly break-even / Working days
💡 Calculate daily target:
€17,021 per month / 26 working days = €655 per day
At an average order value of €18, this means: 36 orders per day
Factor in seasonality and variation
Ghost kitchens often have large fluctuations in revenue. Therefore, calculate with scenarios:
- Slow days: 70% of average revenue
- Normal days: 100% of average revenue
- Busy days: 150% of average revenue
Make sure your busy days compensate for slow periods.
Optimize platform fees
Platform fees are your largest variable cost item. Strategies to lower these:
- Set a higher minimum order value
- Own delivery service for large orders
- Direct customers to your own website/app
- Use multiple platforms for better negotiating power
⚠️ Note:
Platform fees are negotiable at higher volumes. From 1,000+ orders per month you can often get better rates.
Monitor break-even
Track weekly whether you're on track:
- Compare actual revenue with break-even target
- Check if your cost percentages are correct
- Analyze which days/times perform best
- Adjust your planning based on data
An app like KitchenNmbrs helps you automatically track your food cost and total costs, so you can quickly see if you're hitting break-even.
How do you calculate break-even for your ghost kitchen?
Gather all fixed costs per month
Add up: kitchen space rent, permanent staff, insurance, utilities and other fixed expenses. These are costs you pay every month, regardless of your revenue.
Calculate your total variable costs percentage
Add up: food cost percentage, platform fees, packaging costs and variable staff. These are costs that increase with your revenue.
Apply the break-even formula
Divide your fixed costs by (1 minus variable costs percentage). The result is your minimum monthly revenue to break even.
Translate to daily target
Divide your monthly break-even by the number of working days. Calculate how many orders this means at your average order value.
✨ Pro tip
Monitor your break-even weekly, not just monthly. Ghost kitchens have large daily fluctuations, and adjusting early prevents you from running a loss for an entire month.
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
Are platform fees always 20% of the order value?
No, platform fees vary between 15-25% and are often negotiable at higher volumes. Check your contracts regularly and negotiate as you grow.
Should I include VAT in my break-even calculation?
Always calculate with amounts excluding VAT. Your platform revenue and costs are usually already excluding VAT, but verify this in your administration.
What if my break-even is higher than what's realistically achievable?
Then you need to adjust your cost structure: find cheaper rent, source more efficiently, or raise your prices. A break-even that's too high means your concept isn't viable.
How often should I recalculate my break-even?
At least every 3 months, or immediately after changes in rent, platform fees or staff costs. Keep it current for good management.
Does break-even differ per platform where I sell?
Yes, each platform has different fees. Calculate your net margin per platform and focus on the most profitable channels for growth.
📚 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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