Most restaurant owners think they're profitable until they check their bank account. You might feel busy every night, but without knowing your exact break-even point, you're flying blind. Here's how to calculate exactly what daily revenue keeps you afloat.
What is break-even and why does it matter?
Break-even is where your income equals your expenses. No profit, no loss. This figure reveals:
- Minimum revenue you must generate daily
- How many slow days you can survive monthly
- Your current performance actually works or doesn't
⚠️ Note:
Most entrepreneurs only think monthly break-even. But knowing your daily target lets you pivot fast during rough patches.
Gather your fixed costs per month
Fixed costs hit you every month, regardless of sales. These anchor your break-even calculation:
- Rent: Including service charges
- Staff: Fixed salaries (not variable hours)
- Insurance: Liability, inventory, building
- Energy: Gas, water, electricity (average)
- Phone and internet
- Depreciation: Equipment, furniture
- Accountant, administration
💡 Example fixed costs bistro:
A 40-seat bistro carries these fixed costs:
- Rent: €3,500
- Fixed staff costs: €8,000
- Insurance: €450
- Energy: €800
- Other costs: €750
Total fixed costs: €13,500 per month
Determine your variable costs percentage
Variable costs climb with your revenue. The big ones include:
- Food cost: Usually 28-35% of revenue
- Variable staff costs: Extra hours during rushes (15-25%)
- Credit card fees: Around 1-2% of revenue
- Other variable costs: 2-5%
Total variable costs typically run 50-65% of your revenue. And here's one of the most common blind spots in kitchen management: underestimating these percentages during busy periods.
💡 Example variable costs:
Same bistro shows these variable costs:
- Food cost: 32% of revenue
- Variable staff: 18% of revenue
- Credit card fees: 1.5% of revenue
- Other variable: 3% of revenue
Total variable: 54.5% of revenue
Calculate your break-even revenue per month
Now you can figure out your needed revenue. The formula:
Break-even revenue = Fixed costs / (1 - Variable costs %)
That number after the minus sign? That's your contribution margin percentage. It's how much of each euro stays for fixed costs and profit.
💡 Break-even calculation bistro:
Using our numbers:
- Fixed costs: €13,500
- Variable costs: 54.5%
- Contribution margin: 100% - 54.5% = 45.5%
Break-even = €13,500 / 0.455 = €29,670 per month
Convert to daily revenue
Divide monthly break-even by your operating days:
💡 Daily revenue calculation:
Bistro operates 6 days weekly = 26 days monthly:
€29,670 / 26 days = €1,141 per day break-even
At 80 covers daily: €1,141 / 80 = €14.26 average check required
⚠️ Watch seasonal swings:
Quiet months bring higher fixed costs (heating) plus lower revenue. Calculate your winter break-even separately.
Use your break-even figure
Now that you've got your daily target, you can:
- Track daily: Above or below break-even today?
- Plan ahead: How many strong days cover one weak day?
- Make calls: Worth opening on slow days?
- Set targets: How far above break-even for solid profit?
Food cost calculators can automatically compare daily revenue against your break-even point, giving you instant visibility on your trajectory.
How do you calculate your daily break-even revenue? (step by step)
Add up all your fixed costs per month
Make a list of rent, fixed salaries, insurance, energy and other fixed expenses. Add everything together for your total fixed costs per month.
Calculate your variable costs percentage
Add up food cost, variable staff costs and other variable expenses. This gives you the percentage of your revenue that goes to variable costs (usually 50-65%).
Apply the break-even formula
Divide your fixed costs by (1 minus your variable costs percentage). This gives you break-even revenue per month.
Convert to daily revenue
Divide your monthly break-even by the number of days you're open. Now you know exactly how much revenue you need per day to break even.
✨ Pro tip
Monitor your break-even performance for 21 consecutive days to identify weekly patterns. Missing your target more than 6 days in that period signals serious trouble ahead.
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 break-even calculation?
Always calculate with revenue excluding VAT. The VAT you collect goes straight to tax authorities, so it's not real revenue for your business.
What if my variable costs fluctuate monthly?
Take the average from the last 6-12 months. You can calculate seasonal variations separately for summer and winter break-even points.
How often should I recalculate my break-even point?
Review it quarterly or whenever major costs change - new rent, different staffing levels, significant supplier price jumps.
What if I'm above break-even but still have no cash left?
You probably missed costs in your calculation, or your variable costs run higher than expected. Double-check actual food cost and staff expenses.
Is break-even the same as profitability?
No, break-even means zero loss but zero profit too. For healthy profitability you should run 15-25% above your break-even point.
Can I lower my break-even?
Yes, by reducing fixed costs (lower rent, fewer fixed staff) or improving your variable cost percentage through better food cost control and more efficient operations.
What happens if I'm consistently below break-even for weeks?
You're bleeding cash and need immediate action. Either cut fixed costs, improve variable cost percentages, or find ways to boost daily revenue through marketing or menu adjustments.
📚 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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