Upsell items with low margins drain your profits while you think they're boosting revenue. Every "extra" sale actually costs you money. Here's how to turn your upselling strategy into actual profit.
Spot the problem: upsells that drain profits
This scenario plays out daily: your team pushes desserts, appetizers, and specialty drinks. Sales numbers climb, but profit margins shrink. The harder you upsell, the less you actually earn.
💡 Example:
Restaurant De Smaak sells a lot of tiramisu as dessert for €8.50:
- Selling price excl. VAT: €7.80
- Ingredient costs: €3.20
- Food cost: 41%
With every tiramisu you lose money - standard dessert food cost is 25-30%.
Calculate your real upsell costs
Most operators guess at their upsell costs. But guessing kills profits. Calculate exactly what each item costs you:
- Desserts: Typically run 35-45% food cost (way too high)
- Side dishes: Look cheap until portion creep hits
- Premium beverages: Expensive to buy, slow to move
- "Free" extras: Those complimentary garnishes add up fast
⚠️ Note:
Always calculate with the selling price excl. VAT. A dessert of €8.50 incl. VAT is €7.80 excl. VAT for your food cost calculation.
One of the most common blind spots in kitchen management is assuming that higher sales volume automatically means better profits. Many experienced chefs discover too late that their most popular upsells were actually bleeding money.
Three ways to fix broken margins
Strategy 1: Adjust your pricing
Sometimes you just need to charge what the item's actually worth. Calculate your minimum viable price for healthy margins:
💡 Example calculation:
Tiramisu with €3.20 ingredient costs, desired food cost 28%:
- Minimum price excl. VAT: €3.20 ÷ 0.28 = €11.43
- Minimum price incl. VAT: €11.43 × 1.09 = €12.46
From €8.50 to €12.50 - a significant but necessary increase.
Strategy 2: Cut ingredient costs
Reduce costs without sacrificing quality:
- Control portions (120g becomes 100g)
- Source smarter (private label mascarpone)
- Reduce waste (better prep techniques)
- Use seasonal ingredients
Strategy 3: Push profitable alternatives
Redirect your team toward high-margin upsells:
- After-dinner coffee (typically 15-20% food cost)
- House wine by glass (18-25% pour cost)
- Basic desserts (ice cream, seasonal fruit)
- Liqueurs and digestifs (excellent margins)
Train your team on profitable upselling
Your staff needs clear direction on which items actually make money. Don't leave them guessing about what to promote.
💡 Practical example:
Instead of "Would you like a dessert?" train your staff:
- "May I offer you a coffee with petit fours?" (25% food cost)
- "Would you like to try our house wine?" (20% pour cost)
Both have better margins than the tiramisu at 41%.
Track and optimize regularly
Monitor your top-selling upsells weekly. Know their margins inside and out. Adjust quickly when supplier prices shift.
Food cost tracking systems help you spot margin problems before they drain profits. You'll see immediately which upsells contribute and which ones cost you money.
How do you solve upsells with low margin? (step by step)
Calculate the actual food cost of all upsells
List all side dishes, desserts, and extras. Calculate per item: ingredient costs divided by selling price excl. VAT times 100. Anything above 35% is problematic.
Choose your strategy per item
Decide per upsell: raise the price, adjust the recipe, or stop promoting it. For price increases, calculate: ingredient costs divided by desired food cost percentage.
Train your team on profitable alternatives
Give clear instructions on which items to promote (under 30% food cost) and which not to. Make it concrete with example sentences they can use.
✨ Pro tip
Identify your 3 highest-volume upsells this week and calculate their exact margins. If these core items are profitable, you'll fix 80% of your margin problems within 7 days.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
Was this article helpful?
Frequently asked questions
What's a healthy food cost percentage for upsell items?
Desserts should run 25-30%, sides 20-28%, beverages 18-25%. Anything over 35% is costing you profit instead of generating it.
Should I eliminate low-margin upsells completely?
Not necessarily - just redirect your team's focus. Train them to promote coffee, wine by the glass, and simple desserts with better margins instead.
How do I calculate the minimum price for a profitable margin?
Divide ingredient costs by your target food cost percentage. For €3 ingredients with 28% target: €3 ÷ 0.28 = €10.71 excl. VAT.
What if customers reject the higher prices?
Then your original price was unsustainable and you were losing money. It's better to sell fewer items at healthy margins than many at a loss.
How frequently should I review upsell margins?
Monthly at minimum, immediately after supplier price changes. Ingredient costs fluctuate regularly, so your margins will too.
Can I fix margins by reducing portion sizes instead of raising prices?
Yes, but be strategic about it. A 15-20% portion reduction is usually unnoticeable to customers while significantly improving your food cost percentage.
📚 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.
Make better decisions with real numbers
Should you change your menu? Raise prices? Test a new concept? KitchenNmbrs simulates scenarios with your own data. Try it free for 14 days.
Start free trial →