Pricing your menu is like building a house - skip the foundation and everything crumbles. Too many restaurant owners throw darts at a board, hoping their prices stick. Your selling price isn't guesswork - it's math that separates thriving restaurants from ones that close after six months.
Why the right selling price is crucial
Your selling price isn't what you hope to get, but what you minimally need to stay afloat. Price too low and you're bleeding money. Too high and customers vanish. The sweet spot lies in understanding your numbers.
⚠️ Heads up:
Many entrepreneurs forget to include their own salary. If you work 60 hours a week for €0 per hour, your restaurant might break even, but you earn nothing.
The 3 pillars of your selling price
Your selling price must cover 3 things:
- Food cost: Ingredients and beverages (25-35% of revenue)
- Fixed costs: Rent, energy, insurance, depreciation
- Variable costs: Staff, marketing, maintenance
Plus a profit margin for yourself. Otherwise you're working for nothing.
Step 1: Calculate your total costs per month
List every expense that hits your bank account:
💡 Example costs bistro (50 seats):
- Rent: €4,500
- Staff (including yourself): €12,000
- Energy: €800
- Insurance: €300
- Marketing: €400
- Maintenance: €200
- Other costs: €600
Total fixed costs: €18,800/month
Don't forget your own salary! Calculate at least €15-20 per hour for your time.
Step 2: Estimate your number of customers per month
Be realistic here. Not your dream scenario, but what you can actually deliver:
💡 Example occupancy:
50 seats, open 6 days a week:
- Lunch: 20 customers/day × 6 days × 4 weeks = 480 customers
- Dinner: 35 customers/day × 6 days × 4 weeks = 840 customers
Total: 1,320 customers per month
Step 3: Calculate your break-even point
Simple math here - divide total costs by customer count:
Break-even per customer = Total costs ÷ Number of customers
💡 Break-even calculation:
€18,800 ÷ 1,320 customers = €14.24 per customer
This is your minimum average check to break even. Without profit.
Step 4: Add profit margin
You didn't open a restaurant to work for free. Based on real restaurant P&L data, successful operators target 15-25% profit margins above break-even:
💡 Profit margin calculation:
- Break-even per customer: €14.24
- Desired profit margin: 20%
- Minimum average check: €14.24 × 1.20 = €17.09
You need to generate an average of €17.09 per customer for 20% profit.
Step 5: Translate to menu prices
Now you know your target average. Structure your menu to hit this number:
- Main courses: €18-25 (heart of your revenue)
- Starters: €8-12 (boost average check)
- Desserts: €6-9 (pure profit, low food cost)
- Beverages: €2.50-8 (high margin)
⚠️ Heads up:
Check if your prices match your target audience. An average check of €35 in a working-class neighborhood will be tough. Adjust your concept to your location.
Check your food cost percentage
Per dish, your food cost should stay between 25-35%. Higher means insufficient margin.
Food cost % = (Ingredient costs ÷ Selling price excl. VAT) × 100
💡 Food cost check:
Steak on menu: €24.00 incl. 9% VAT
- Selling price excl. VAT: €24.00 ÷ 1.09 = €22.02
- Ingredient costs: €7.50
- Food cost: (€7.50 ÷ €22.02) × 100 = 34.1%
This is acceptable (under 35%).
Monitor and adjust
Your selling price isn't carved in stone. Review monthly:
- Do your cost estimates match reality?
- Are you hitting your target average check?
- Are your food costs still under control?
- Are suppliers raising their prices?
A food cost calculator helps you automatically track costs per dish, so you'll spot when prices need adjusting.
How do you calculate the optimal selling price? (step by step)
Inventory all monthly costs
Make a complete list of rent, staff (including yourself!), energy, insurance, marketing and other costs. Don't forget any cost item.
Calculate realistic customer flows
Estimate how many customers you expect per day, both lunch and dinner. Calculate with 6 days a week and 4 weeks a month for a monthly total.
Determine break-even per customer
Divide your total monthly costs by the number of expected customers. This is the minimum each customer must spend to break even.
Add profit margin (15-25%)
Multiply your break-even amount by 1.15 to 1.25 for a healthy profit margin. This becomes your minimum average check.
Build menu around average check
Set your menu prices so you hit the calculated average check. Check per dish that food cost stays under 35%.
✨ Pro tip
Test 3 different price points over 21 days to find your sweet spot. Start with your calculated minimum, then try 10% higher and 10% lower to see which generates the most total profit.
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 my own salary in the costs?
Absolutely! Calculate at least €15-20 per hour for your time. Otherwise you're working for free and your restaurant has no real profit. Many owners skip this step and wonder why they can't pay themselves.
What if my calculated prices seem too high for my neighborhood?
Then you need to adjust your concept. Consider cheaper ingredients, smaller portions, or a different cuisine style. You can't sell below your cost price and expect to survive.
How often should I check my prices?
Review them every 3 months minimum. Check if costs have increased, if you're hitting your target average, and if suppliers have raised prices. Food costs can shift quickly.
Can I charge different prices for lunch and dinner?
Yes, that's standard practice. Lunch is often cheaper, but you need higher volume to cover costs. Calculate both periods separately to ensure profitability.
What if I'm not hitting my average check?
You have 3 options: raise prices, lower costs, or attract more customers. Usually a combination works better than relying on just one approach.
Should I factor in seasonal fluctuations?
Definitely. Calculate your worst 3 months separately - if you can survive those, you'll thrive during peak seasons. Don't just plan for your busy periods.
How do I handle menu items with wildly different food costs?
Balance high-cost items (like seafood) with low-cost winners (like pasta). Your menu mix should average out to your target food cost percentage across all dishes.
📚 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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