87% of restaurants that track monthly P&L statements survive their first three years, compared to just 52% that don't. Most restaurant owners trust their gut for numbers, but without a proper P&L you can't spot where money's disappearing. A structured profit and loss statement shows exactly where every dollar flows.
What is a P&L statement?
A P&L (Profit & Loss) tracks your income and expenses over a specific timeframe. It shows if you're profitable and - more importantly - pinpoints exactly where your money flows.
💡 Example P&L restaurant (monthly):
Restaurant De Smaak, March 2024:
- Revenue: €45.000
- Food cost: €13.500 (30%)
- Staff: €18.000 (40%)
- Rent: €4.500 (10%)
- Other costs: €4.500 (10%)
Net profit: €4.500 (10%)
The main categories of your P&L
Every restaurant follows the same core structure. Percentages vary by concept, but these categories stay constant.
1. Revenue
All money flowing in:
- Food and beverages (excl. VAT)
- Additional services (private events, catering)
- Tips processed through your POS system
⚠️ Note:
Always calculate excluding VAT. VAT collected gets passed to tax authorities - that's not your actual revenue.
2. Cost of Goods Sold (COGS) - Food cost
Every ingredient that reaches your customers:
- Meat, fish, produce
- Beverages (alcoholic and non-alcoholic)
- Spices, oils, dairy
- Everything that touches the plate
Typical food cost: 28-35% of your revenue
3. Staff costs
All team-related expenses:
- Gross wages (including owner salary)
- Employer contributions (social premiums)
- Pension contributions
- Temporary staff costs
Typical staff costs: 35-45% of your revenue
💡 Example staff costs:
Restaurant with €40.000 monthly revenue:
- Chef (gross): €3.200
- Service staff (2x part-time): €2.800
- Owner (own salary): €4.000
- Employer contributions (30%): €3.000
Total staff: €13.000 (32,5%)
4. Operating costs
Everything else needed to keep doors open:
- Rent and related costs: rent, service charges, insurance
- Energy: gas, water, electricity
- Marketing: advertising, website, social media
- Administration: accountant, POS system, apps
- Maintenance: repairs, cleaning, replacements
P&L percentages that add up
For a profitable restaurant, the breakdown typically looks like this:
💡 Healthy P&L breakdown:
- Food cost: 28-35%
- Staff: 35-45%
- Rent: 6-10%
- Energy: 3-6%
- Other costs: 8-12%
- Net profit: 8-15%
⚠️ Note:
These serve as guidelines, not rigid rules. Fine dining establishments often carry higher staff costs, while pizza joints typically run lower food costs.
Where it often goes wrong
Most restaurant owners stumble on the same P&L pitfalls - a pattern we see repeatedly in restaurant financials:
Forgetting your own salary
Your time has real value. Working 60-hour weeks? Factor in a realistic owner salary. Otherwise your profit looks artificially inflated.
Not including depreciation
Equipment wears out. Refrigerators die. Furniture breaks. Set aside 3-5% of revenue monthly for inevitable replacements.
Ignoring seasonal swings
Create monthly P&Ls, but analyze annual patterns too. July might boom while January barely breaks even. Plan accordingly.
P&L as a management tool
Your P&L isn't just paperwork for accountants. It's your business compass:
- Food cost spiking? Audit recipes and supplier pricing
- Staff costs ballooning? Review scheduling and efficiency
- Revenue dropping? Time for marketing or menu optimization
💡 Practical example:
Your food cost hits 38% instead of 30%. On €50.000 revenue:
- Current food cost: €19.000
- Target food cost: €15.000
- Monthly difference: €4.000
That's €48.000 annually you could reclaim!
How do you set up a P&L? (step by step)
Gather all your financial data
Pull your revenue figures from your cash register system (excl. VAT), all supplier invoices, staff administration and fixed costs like rent and energy. Do this for a whole month to get a complete picture.
Categorize all costs
Divide your expenses across the main categories: food cost, staff, rent, energy, marketing and other costs. Add up all amounts per category and calculate the percentage of your total revenue.
Calculate your net profit
Subtract all costs from your revenue. The amount left over is your net profit. Also calculate the percentage: (net profit / revenue) × 100. A healthy net profit is between 8-15%.
Compare with benchmarks
Check if your percentages match the typical figures for restaurants. Food cost 28-35%, staff 35-45%, rent 6-10%. Do your figures differ significantly? Then you know where to take action.
Make it a monthly routine
Set up your P&L every month and compare it with the previous month. This way you see trends and can quickly adjust if something goes wrong. A good P&L helps you plan ahead instead of being surprised afterwards.
✨ Pro tip
Create your first P&L within 30 days of opening, then update it monthly for the first year. Most new owners wait 6 months to track numbers - by then, bad habits cost thousands.
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 my P&L calculations?
Never include VAT in your P&L. VAT collected goes straight to tax authorities - it's not your revenue. Same for expenses: calculate excluding VAT since you typically recover it. This gives you true operational numbers.
How do I calculate my owner salary realistically?
Calculate hours worked weekly, then research what you'd pay a manager with your responsibilities. Most restaurant owners should factor €3.000-€5.000 gross monthly. Don't shortchange yourself - it skews your true profitability.
What if my food cost percentage keeps climbing above 35%?
Audit your recipes immediately for portion creep and waste. Check if suppliers raised prices without notice. Review prep methods - poor knife skills and improper storage destroy margins fast.
📚 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.
All your financial KPIs in one dashboard
Food cost percentage, gross margin, revenue per cover — KitchenNmbrs calculates it all automatically based on your recipes and purchases. Start your free trial.
Start free trial →