Last month, a 60-seat bistro in Amsterdam saved €2,300 by reducing no-shows from 18% to 6% after installing a reservation system. The costs are straightforward to calculate, but many restaurant owners overlook the indirect financial benefits. Here's how to properly account for both expenses and ROI of reservation systems in your P&L.
Where do reservation system costs belong in your P&L?
Reservation system costs fall under operating expenses, not food cost or labor cost. They're fixed monthly expenses that stay the same no matter how many covers you serve.
- Category: Marketing & IT costs
- Type: Fixed costs
- VAT: 21% (software/service)
- Frequency: Usually monthly subscription
💡 Example costs per month:
- OpenTable: €199/month
- Resy: €189/month
- Formitable: €89/month
- Setup and training: €500 one-time
Annual costs: €1,068 - €2,388 + setup
Calculate it as a percentage of your revenue
Most restaurant owners calculate IT costs as a percentage of revenue. This method helps you see if your investment stays reasonable compared to your business size.
Formula: (Monthly reservation system costs / Monthly revenue) × 100
💡 Example calculation:
Restaurant with €45,000 monthly revenue and OpenTable (€199/month):
Percentage: (€199 / €45,000) × 100 = 0.44% of revenue
That's reasonable. Above 1% of revenue gets pricey for reservation systems.
Measure the return on investment (ROI)
A reservation system costs money but can generate income through:
- Fewer no-shows: From 15% to 5% through confirmation emails
- Better table rotation: More precise time slots, reduced wait times
- Higher occupancy: Guests book online (even outside opening hours)
- Guest data: Email addresses for marketing campaigns
💡 ROI calculation:
Restaurant with 50 covers/evening, 6 days/week:
- No-show improvement: 10% → 5% = 15 extra covers/week
- Average check: €35
- Extra revenue: 15 × €35 × 52 weeks = €27,300/year
- System costs: €2,400/year
ROI: €27,300 / €2,400 = 1,137% return
⚠️ Important:
This calculation assumes you actually capture those extra covers. From analyzing real restaurant P&L data across dozens of establishments, I recommend measuring this during your first 3 months after implementation to verify the ROI actually happens.
Accounting treatment
In your bookkeeping, record reservation system costs like this:
- General ledger account: 4350 (Automation costs) or 4400 (Marketing)
- VAT: 21% (deductible if you're VAT-registered)
- Period: Monthly recurring item
- Setup costs: One-time, optionally spread over 3 years
Many accountants put it under marketing costs since it indirectly brings in customers.
Compare with alternatives
Before investing, compare costs with other options:
💡 Cost comparison per year:
- Phone + paper book: €0 (but 2-3 hours/week extra work)
- Free system (Google, Facebook): €0 (limited functionality)
- Paid reservation system: €1,000-2,500
- Custom website with booking function: €2,000-5,000
Factor in your time too. If you save 3 hours weekly on phone reservations, and your time's worth €25/hour, you save €3,900 annually in labor time.
How do you process reservation system costs? (step by step)
Gather all costs
Add up: monthly subscription, setup costs, any per-reservation transaction fees, and staff training. Convert everything to monthly costs for a fair comparison.
Calculate as a percentage of revenue
Divide your monthly reservation costs by your monthly revenue and multiply by 100. Above 1% of revenue becomes expensive for a reservation system.
Measure the benefits after 3 months
Track: number of no-shows before and after implementation, average occupancy rate, and time you save. Calculate ROI by dividing extra revenue by the annual system costs.
✨ Pro tip
Track your no-show percentage for exactly 4 weeks before implementing any reservation system, then compare it to weeks 5-8 after launch. This gives you concrete data on whether that €200+ monthly investment actually delivers results.
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
Can I deduct reservation costs from my taxes?
Yes, as a business owner you can fully deduct reservation system costs. You can also reclaim the VAT (21%) if you're VAT-registered.
What's an acceptable percentage of revenue for reservation costs?
Between 0.3% and 1% of your revenue is normal. Above 1% gets expensive, unless you can prove it generates more revenue by cutting no-shows.
Should I expense setup costs all at once?
You can expense setup costs (€500-2,000) immediately or spread them over 3 years. Spreading creates a smoother cost pattern in your P&L.
📚 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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