Ever had that sinking feeling when your accountant delivers the brutal truth about your restaurant's finances? If they say your business isn't viable, you're spending more each month than you're earning — and it's structural. This isn't a death sentence, just a wake-up call that demands immediate action.
What exactly does 'not viable' mean?
Your accountant's looking at cold, hard numbers that show you're bleeding money every month. This typically means:
- Your food cost is too high (above 35-40%)
- Your labor costs are too high (above 30-35%)
- Your fixed costs are too heavy for your revenue
- You don't have enough revenue for your cost structure
💡 Example:
Restaurant with €25,000 monthly revenue:
- Food cost: €10,000 (40%)
- Labor: €9,000 (36%)
- Rent + utilities: €4,500 (18%)
- Other costs: €2,000 (8%)
Total costs: €25,500 = €500 loss per month
Your options in order of impact
Option 1: Drastically lower food cost
This delivers the fastest impact since you control it directly:
- Calculate the actual cost price of every dish — include everything
- Raise prices on dishes with food cost above 35%
- Cut loss-making dishes from the menu entirely
- Renegotiate with suppliers or find new ones
⚠️ Note:
Dropping food cost by 5 percentage points on €25,000 revenue = €1,250 extra profit monthly. That's often the difference between survival and closure.
Option 2: Boost revenue
More customers mean more income while your fixed costs stay the same:
- Double down on your most profitable dishes
- Strengthen your online presence (Google, social media)
- Launch delivery through platforms like Thuisbezorgd
- Host events or themed nights
Option 3: Optimize labor costs
This doesn't automatically mean firing people. Sometimes you just need to work smarter:
- Match your schedules to actual customer flow
- Train staff for speed and efficiency
- Use flexible contracts for busy periods
- Last resort: reduce hours or staff
Option 4: Slash fixed costs
Based on real restaurant P&L data, rent negotiations can save businesses. But it requires tough conversations:
- Negotiate lower rent with your landlord
- Review your energy contract and insurance
- Find cheaper software and service alternatives
- Eliminate anything that doesn't generate revenue
💡 Example recovery plan:
Same restaurant, after 3 months of changes:
- Food cost reduced to €7,500 (30%)
- Revenue increased to €27,000
- Labor optimized to €8,100 (30%)
- Rent negotiated down to €4,000
Result: €1,400 profit per month
Knowing when to quit
Sometimes closing is the smartest move. Consider it if:
- You've tried everything above without results
- Your location can't attract enough customers
- You're personally burned out with no energy left
- Debts are so high that recovery's impossible
If you must stop, do it properly: file for bankruptcy or sell if possible. Don't wait until your personal assets are at risk too.
Get help
You don't need to tackle this alone. Reach out to:
- Your accountant for detailed cost breakdowns
- A hospitality consultant who specializes in turnarounds
- Fellow restaurant owners who've survived similar crises
- Your suppliers — they want you to succeed
Tools like KitchenNmbrs help you track exact food costs per dish. You can't fix what you can't measure.
How do you create a recovery plan? (step by step)
Analyze your current situation
Ask your accountant for an overview of all costs by category (food, labor, rent, other) as a percentage of your revenue. Also check your average monthly revenue for the last 6 months.
Calculate your break-even point
Add up all your fixed costs (rent, insurance, minimum staff). Divide this by your average margin per euro of revenue. This gives you the minimum revenue you need to break even.
Create a 90-day action plan
Choose a maximum of 3 actions you can implement within 90 days. For example: lower food cost to 30%, increase revenue by 10%, and renegotiate rent. Measure your progress weekly.
✨ Pro tip
Pull your sales data from the last 30 days and calculate food costs on your top 3 revenue-generating dishes. If any exceed 35%, you've found your biggest profit leak and can act within 48 hours.
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
How long do I have to save my business?
That depends on your cash flow. If you're losing €500 monthly with a €5,000 buffer, you've got 10 months. But start taking action immediately — don't wait until it's too late.
Do I have to raise my prices if my accountant says this?
Only if your food cost exceeds 35%. Start by raising prices on your biggest loss-makers. Test carefully — don't jack everything up 20% overnight.
Can I take out a loan to buy time?
Only with a concrete profitability plan. A loan without a strategy just makes the hole deeper. Fix the underlying issues first, then consider additional funding.
What if my landlord won't negotiate on rent?
Explain that you might close otherwise — then they get zero rent. Most landlords prefer cooperation over an empty property that could sit vacant for months.
📚 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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