POS system costs belong under operational expenses on your P&L, not under food or labor. Many restaurant owners misplace these costs, which throws off their cost analysis. Learn exactly how to process POS costs correctly and what it means for your profitability.
Where do POS costs belong on your P&L?
POS system costs are operational expenses, also called general business costs. They do NOT fall under food cost or labor costs, but under a separate category.
? Example P&L breakdown:
- Revenue: €50,000
- Food cost: €15,000 (30%)
- Labor costs: €20,000 (40%)
- Operational costs: €8,000 (16%)
- - of which POS system: €400
Profit before tax: €7,000 (14%)
Which POS costs should you include?
A POS system has different cost components that you need to track:
- Monthly software license: €30-150 per month
- Transaction fees: 1.5-3% of revenue via card payments
- Hardware depreciation: tablet, printer, cash drawer
- Support and maintenance: often 10-20% of license costs
⚠️ Note:
Transaction fees are variable and increase with revenue, while license costs stay fixed. This affects your break-even calculation.
How do you calculate the impact on your margin?
POS costs typically run 1-3% of your revenue. Seems small, but it comes straight off your profit. And here's a mistake that costs the average restaurant EUR 200-400 per month: booking these costs under the wrong category.
? Example calculation:
Restaurant with €40,000 monthly revenue:
- POS license: €80/month
- Transaction fees (2%): €800/month
- Hardware depreciation: €50/month
Total POS costs: €930/month = 2.3% of revenue
Fixed vs. variable POS costs
For your break-even calculation, you need to split POS costs:
- Fixed costs: software license, hardware depreciation
- Variable costs: transaction fees (percentage of revenue)
This distinction matters for scenario planning. If your revenue drops, only transaction costs will decrease with it.
POS costs vs. other systems
Always compare total costs, not just the advertised price:
? Comparison of two systems:
System A: €50/month + 2.5% transaction fees
System B: €120/month + 1.8% transaction fees
At €30,000 monthly revenue:
- System A: €50 + €750 = €800
- System B: €120 + €540 = €660
System B is €140/month cheaper!
Administrative processing
Always book POS costs under the correct cost center:
- Software costs: account 4050 (IT costs)
- Transaction fees: account 4150 (bank fees)
- Hardware: account 4000 (office costs) or depreciate
⚠️ Note:
NEVER book POS costs under food cost. This distorts your cost price calculation and food cost percentage.
How do you process POS costs correctly? (step by step)
Gather all POS-related costs
Make a list of all costs: monthly license, transaction fees, hardware depreciation, and support. Check your invoices from the past 3 months to make sure you don't miss anything.
Split fixed and variable costs
Divide your POS costs: fixed costs (license, hardware) go to operational expenses, variable costs (transactions) you calculate as a percentage of revenue. This is important for your break-even calculation.
Calculate the percentage of your revenue
Divide your total monthly POS costs by your monthly revenue and multiply by 100. This gives you the percentage that POS costs represent of your revenue, usually 1-3%.
Book under the correct cost center
Use separate accounting accounts: software under IT costs, transaction fees under bank fees. NEVER book under food cost or labor costs.
✨ Pro tip
Review your transaction fee structure every 6 months against your actual card payment volume. Many providers offer better rates once you hit €25,000+ in monthly card transactions.
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Frequently asked questions
What percentage of my revenue should POS costs be?
Should I track transaction fees separately from license costs?
Can I write off POS hardware immediately?
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
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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