The margin on a catering contract determines whether you make a profit or loss. With catering, there are extra costs you don't have in your restaurant: transport, setup, additional staff on-site. In this article, you'll learn step-by-step how to calculate a realistic margin that covers all costs.
Gather all costs for 200 people
With catering, you look at costs per person, not per plate. You have three main categories: ingredients, staff, and logistics.
💡 Example: Business lunch for 200 people
Menu: sandwiches, soup, salad per person €12.50 incl. VAT
- Ingredients: €4.50 per person
- Staff (3 chefs + 2 servers): €480
- Transport + materials: €150
Total costs: €4.50 × 200 + €480 + €150 = €1,530
Calculate your selling price excluding VAT
Catering falls under 9% VAT. Your menu price is usually shown including VAT on the quote, but for margin calculation you always work excluding VAT.
- Formula: Selling price excl. VAT = Selling price incl. VAT ÷ 1.09
- €12.50 incl. VAT = €11.47 excl. VAT per person
- 200 people × €11.47 = €2,294 total revenue excl. VAT
Calculate your margin
Margin is the difference between your revenue and costs, expressed as a percentage of your revenue.
💡 Margin calculation:
- Revenue excl. VAT: €2,294
- Total costs: €1,530
- Profit: €2,294 - €1,530 = €764
Margin: (€764 ÷ €2,294) × 100 = 33.3%
Check your food cost separately
In addition to total margin, it's smart to check your food cost separately. That's just the ingredient portion.
- Food cost: (€4.50 ÷ €11.47) × 100 = 39.2%
- For catering, 35-45% food cost is normal
- Higher than restaurant because you have extra packaging and logistics
⚠️ Watch out:
Don't forget costs: disposable tableware, napkins, dishwashing on-site, staff travel time. These small items can quickly eat into your margin.
Minimum margin for catering
Catering has more risk than restaurant service. Guests can cancel last-minute, but you've already purchased ingredients and scheduled staff.
- Standard catering margin: 25-35% minimum
- Below 25%: not enough buffer for unexpected costs
- Above 40%: probably too expensive for the market
💡 Break-even check:
If 10% of your guests cancel last-minute:
- You lose 20 × €11.47 = €229 in revenue
- But ingredients (20 × €4.50 = €90) you can often still use
- Net loss: €139
Your margin of €764 should be able to absorb this.
Digital support for margin calculation
Many caterers use Excel, but that gets complex with multiple menus and varying group sizes. A system like KitchenNmbrs helps you quickly run different scenarios and keep track of your margin per contract.
How do you calculate the margin on a catering contract? (step by step)
Add up all costs per person
Calculate ingredients, staff, and logistics together. Don't forget: transport, materials, disposable tableware, and staff travel time.
Calculate revenue excluding VAT
Divide your menu price by 1.09 (for 9% VAT) and multiply by number of people. This is your actual revenue.
Calculate margin
Subtract total costs from revenue excl. VAT. Divide by revenue and multiply by 100 for percentage. Aim for a minimum of 25%.
✨ Pro tip
Always check your margin on your 3 best-selling catering menus. If those are solid, you have 80% of your profitability under control.
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
What is a good margin for catering?
A healthy margin for catering is between 25-35%. Below 25%, you don't have enough buffer for unexpected costs or last-minute changes.
Should I include VAT in my margin calculation?
No, always calculate excluding VAT. The VAT you collect you pass on to the tax authority, so it doesn't count toward your profit.
How do I convert staff costs to cost per person?
Add up total staff costs (wages + travel time) and divide by number of guests. For 200 people with €480 in staff costs = €2.40 per person.
What if guests cancel last-minute?
Build a buffer into your margin of at least 5-10%. Also make clear agreements about cancellation fees in your contract.
Is my food cost higher for catering than in a restaurant?
Yes, that's correct. With catering you have extra packaging costs and less opportunity to reuse leftovers. 35-45% food cost is normal.
📚 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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