Hiring staff is a big step that directly impacts your profit. Many entrepreneurs guess, but you can calculate it. In this article you'll learn which numbers you need to make this decision with your head instead of your gut.
The basics: what does extra staff really cost?
Before you can decide if extra staff is worthwhile, you need to know what it actually costs. It's not just about the salary.
💡 Example:
Chef employed at €15/hour, 32 hours per week:
- Gross salary: €1,920 per month
- Employer contributions (25%): €480
- Holiday pay, 13th month: €320
- Work clothes, training: €100
Total costs: €2,820 per month
Always calculate with at least 25% employer contributions on top of the gross salary. For higher salaries this can go up to 30%.
Calculate your break-even point
How much extra revenue do you need to cover those staff costs? This depends on your net profit margin.
💡 Example calculation:
Extra staff costs: €2,820 per month
Net profit margin: 12%
Required extra revenue: €2,820 ÷ 0.12 = €23,500 per month
The formula: Extra staff costs ÷ net profit margin = required extra revenue
⚠️ Note:
Use your net profit margin, not your gross margin. After deducting all costs except staff.
Analyze your current capacity
Before hiring staff, check if your current team is already at its limit. You do this by measuring your peak times.
- Service speed: How long do guests wait on average?
- Kitchen stress: Is your chef falling behind during busy services?
- Cancellations: Do you often say 'no' to reservations?
- Quality: Do you make more mistakes when busy?
If you answer 'yes' to 2 or more points, you're probably already losing revenue due to insufficient capacity.
Measure the difference: before and after
The best way to know if extra staff is worthwhile is to compare your numbers before and after hiring.
💡 Example situation:
Restaurant does €45,000 revenue per month with 2 chefs. Hires 3rd chef for €2,820/month.
- Month 1 after hiring: €52,000 revenue
- Extra revenue: €7,000
- At 12% net margin: €840 extra profit
- Minus staff costs: €840 - €2,820 = -€1,980
Still need €16,500 extra revenue to break even
Consider alternatives
Sometimes hiring staff isn't the only solution. First look at these options:
- Improve efficiency: Better organize mise-en-place
- Simplify menu: Less complex dishes = faster cooking
- Temp workers: Only for busy periods
- Raise prices: Fewer guests, more margin per guest
⚠️ Note:
Hiring staff is easier than firing them. Try temporary solutions first.
The 3-month test
Give yourself 3 months to see if extra staff pays off. Measure every month:
- Revenue difference compared to last year
- Number of covers per service
- Average bill value
- Complaints about service speed
- Total staff costs as % of revenue
If after 3 months your revenue hasn't increased enough to cover the extra costs, consider other options.
How do you calculate if hiring staff is worthwhile? (step by step)
Calculate total staff costs
Add gross salary + 25% employer contributions + holiday pay + extra costs (clothes, training). This is your monthly investment.
Determine your net profit margin
Divide your monthly profit by your revenue. You need this percentage to calculate how much extra revenue you need to generate.
Calculate required extra revenue
Divide your extra staff costs by your net profit margin. This is the amount you need to generate extra to break even.
Measure your current capacity
Check if you're already losing revenue due to insufficient staff. Pay attention to wait times, cancellations and quality during busy moments.
Test for 3 months and evaluate
Hire staff and measure every month whether you're hitting the required extra revenue. If not, consider alternatives.
✨ Pro tip
Start with a 3-month trial period using a temporary contract. This way you can measure if it's worthwhile without committing to a permanent contract right away.
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
How much of my revenue should go to staff?
For restaurants, 25-35% of revenue for staff is standard. For cafes and snack bars this can be lower (20-30%). Check monthly to make sure you stay within this range.
Is it better to hire temp workers than permanent staff?
Temp workers cost more per hour (often €18-25) but you have no fixed costs. Good for peak times or to test whether extra staff is worthwhile before hiring someone permanently.
What if my revenue hasn't increased enough after 3 months?
First look at other causes: is your marketing good, is your menu pricing right, is it seasonal? Sometimes it takes longer than 3 months to see the effect.
How do I know if I have too few staff?
Signs: guests wait longer than 15 minutes for food, you often say 'no' to reservations, your team makes more mistakes when busy, or you get complaints about slow service.
Should I include employer contributions in my calculation?
Absolutely. Employer contributions are at least 25% of the gross salary. Forget this and your calculation won't be correct. Also include holiday pay and any bonuses.
📚 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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