Are you leaving money on the table by not knowing which service drives your real profits? Many restaurants earn less per guest during lunch, but also have lower labor costs. Splitting your P&L per service reveals which part of the day actually generates the most profit.
Why analyze lunch and dinner separately?
Your lunch and dinner services operate like two distinct businesses under one roof. Different menus, different pricing, different staffing levels, different cost structures. Combining them in a single P&L masks where your actual profit originates.
💡 Example:
Restaurant De Proeverij operates 6 days weekly:
- Lunch: 40 covers/day × €18 average = €720
- Dinner: 70 covers/day × €32 average = €2.240
- Daily total: €2.960
But which service actually drives profitability?
Split your revenue per service
Begin by separating revenue figures. Most POS systems handle this automatically, though manual tracking works too.
- Lunch revenue: All sales between 12:00-15:00
- Dinner revenue: All sales from 17:30 onwards
- Between services: Separate category for coffee/pastries during transition
Assign beverages correctly to each service. That €45 bottle of wine at lunch? It belongs to lunch revenue.
Allocate your food cost per service
Here's where it gets tricky. You must calculate ingredient costs for lunch dishes versus dinner dishes separately.
💡 Example calculation:
Average ingredient costs per portion:
- Lunch dish: €5.40 per portion
- Dinner dish: €9.80 per portion
- 40 lunches × €5.40 = €216 food cost lunch
- 70 dinners × €9.80 = €686 food cost dinner
Food cost lunch: €216 / €720 = 30.0%
Food cost dinner: €686 / €2.240 = 30.6%
Calculate labor costs per service
From years of working in professional kitchens, I've seen how dramatically staffing varies between services. Split labor costs based on actual hours worked per service.
- Kitchen: How many chef hours during lunch versus dinner?
- Service: Server count per service
- Dishwashing: Often dinner-only position
⚠️ Note:
Allocate fixed costs (rent, insurance) proportionally to revenue. If lunch represents 25% of revenue, it carries 25% of fixed costs.
Assign other costs
Distribute remaining expenses fairly across both services:
- Energy: Proportional to revenue or cover count
- Rent: Proportional to revenue
- Marketing: Service-specific (lunch promotions vs. dinner campaigns)
- Depreciation: Proportional to revenue
Calculate profit margin per service
Now you can determine each service's profit margin:
Profit margin % = ((Revenue - All costs) / Revenue) × 100
💡 Example outcome:
Restaurant De Proeverij daily breakdown:
- Lunch: €720 revenue - €580 costs = €140 profit (19.4%)
- Dinner: €2.240 revenue - €1.570 costs = €670 profit (29.9%)
Result: Dinner delivers higher profit per euro, but lunch contributes to fixed cost coverage.
What do you do with this information?
Armed with service-specific profitability data, you can make targeted decisions:
- Low lunch margin: Increase prices or develop lower-cost lunch options
- High dinner margin: Invest more in dinner marketing, extend evening hours
- Loss-making service: Consider elimination or concept revision
Tools like KitchenNmbrs help calculate precise dish costs, so you'll know exactly which lunch and dinner items drive the most profit.
How do you calculate profitability per service? (step by step)
Collect revenue data per service
Pull from your POS system the revenue from lunch (12:00-15:00) and dinner (17:30-22:00) separately. Do this for at least 4 weeks to get a reliable average.
Calculate food cost per service
Calculate what your average lunch dish and dinner dish costs in ingredients. Multiply this by the number of covers per service to get your total food cost.
Allocate labor costs based on actual hours
Add up how many hours your staff works during lunch versus dinner. Calculate their hourly wage through to the costs per service.
Assign fixed costs proportionally to revenue
Distribute rent, insurance, and depreciation proportionally. If lunch is 25% of your revenue, lunch gets 25% of your fixed costs.
Calculate profit margin per service
Subtract all costs from revenue per service. Divide the profit by the revenue and multiply by 100 to get your profit margin percentage.
✨ Pro tip
Track your beverage attachment rates separately for each service over a 30-day period. Lunch guests typically order 40% fewer drinks, which can turn a decent food margin into an overall loss per cover.
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 also split fixed costs like rent between lunch and dinner?
Yes, allocate fixed costs proportionally to revenue. If lunch generates 30% of revenue, it carries 30% of rent costs. This provides an accurate profitability picture per service.
What if my lunch turns out to be loss-making?
A loss-making lunch can still add value if it covers more than variable costs (food + extra labor). Calculate whether lunch revenue exceeds these direct costs - if so, it helps cover fixed expenses.
How often should I perform this analysis?
Conduct this review quarterly minimum, or whenever you adjust prices or concept. Seasonal changes can dramatically shift the lunch-dinner profitability ratio.
Can I do this without a POS system that tracks time periods?
Absolutely. Manually track covers per service and average ticket amounts, then multiply for revenue calculations. It requires more effort but delivers the same insights.
What if I serve identical dishes at lunch and dinner?
Your food cost percentage likely remains constant, but other expenses (staffing, utilities) still vary significantly. Focus on allocating non-food costs accurately between services.
How do I handle shared prep costs between lunch and dinner items?
Allocate prep labor based on which service uses more of each ingredient. If 60% of your tomato prep goes to lunch salads, lunch carries 60% of that prep cost.
📚 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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