A busy week with promotions seems good for revenue, but can wipe out your profit completely. Many restaurant owners only see full tables and high revenue figures, but forget that discounts and extra costs destroy margins. Here's why busy promotion weeks often disappoint financially.
Why promotions eat your profit
A promotion week attracts customers, but simultaneously creates hidden costs that eat away your profit. The problem lies in three areas: lower margins per dish, higher operational costs, and uncontrolled expenses.
💡 Example:
Restaurant with 25% discount on all main courses:
- Normal: steak €32.00 (food cost €9.60 = 30%)
- With discount: €24.00 (food cost €9.60 = 40%)
- Profit per steak drops from €22.40 to €14.40
At 100 steaks: €800 less profit in one week
The hidden costs of being busy
More guests automatically means higher costs you don't always see coming. Staff works overtime, you buy more at higher prices, and the kitchen makes more mistakes under pressure.
- Extra staff costs: Overtime costs 125% of regular wages
- Rush deliveries: Last-minute purchases are 10-20% more expensive
- Waste: Stress in the kitchen leads to more mistakes and thrown-away food
- Quality loss: Rushing can lead to complaints and free replacements
💡 Example calculation of extra costs:
Busy promotion week with 50% more guests:
- Extra overtime: 2 people × 10 hours × €18.75 = €375
- Rush deliveries: €500 extra purchases × 15% = €75
- Waste due to stress: €200
Total extra costs: €650 in one week
The revenue illusion effect
Higher revenue feels good, but says nothing about your profit. A full restaurant with low margins generates less than a half-full restaurant with healthy prices. After managing kitchen operations for nearly a decade, I've seen too many owners celebrate busy weeks that actually hurt their bottom line.
⚠️ Watch out:
Revenue minus all costs equals profit. A promotion week with €10,000 revenue but €9,500 costs yields €500. A normal week with €7,000 revenue and €5,500 costs yields €1,500.
Promotions that actually work
Promotions can be profitable if you plan and calculate them properly. The secret lies in choosing the right dishes and controlling your costs.
- Choose dishes with low food cost: Pasta and pizza can handle 20-25% discounts
- Plan your purchases: No last-minute orders at high prices
- Schedule extra staff: Avoid overtime by scheduling ahead
- Calculate beforehand: Know exactly what each discounted dish still generates
💡 Example smart promotion:
Pizza promotion: 2nd pizza at half price
- Pizza 1: €16.00 (food cost €4.00 = 25%)
- Pizza 2: €8.00 (food cost €4.00 = 50%)
- Average food cost: €8.00 / €24.00 = 33%
Still a healthy margin, but customer feels rewarded
How to measure the real impact
To know if a promotion week was successful, you need to look beyond just revenue. Calculate your net profit and compare it to a normal week.
Formula for promotion success:
(Promotion week revenue - All promotion week costs) vs (Average normal week revenue - Average normal week costs)
Only if the promotion week generates more net profit was it successful. Many entrepreneurs forget to include the extra costs and mistakenly think their promotion went well.
How do you calculate if a promotion is profitable?
Calculate your new food cost per dish
Take the ingredient costs and divide by the new selling price (excl. VAT). With 25% discount on a €32.00 dish this becomes €24.00 / 1.09 = €22.02 excl. VAT.
Estimate the extra operational costs
Calculate what extra staff, rush deliveries and waste will cost. Add at least 10-15% extra costs for a busy promotion week.
Compare total profit with normal week
Subtract all costs from your expected revenue and compare with an average week. Only if the promotion week generates more net profit is it successful.
✨ Pro tip
Track your actual profit within 48 hours of each promotion week by subtracting overtime, rush delivery fees, and waste costs from revenue. Most promotions that look successful on paper actually lose you €300-800 per week.
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
Why do I earn less while my revenue is higher?
Because your costs rise faster than your revenue. Discounts lower your margin per dish, while being busy increases your operational costs through overtime and rush deliveries.
What food cost can I still have with a 20% discount?
If you normally have 30% food cost, this becomes about 37-38% with a 20% discount. That's still acceptable, but higher becomes risky for your profit.
How do I prevent extra costs during busy weeks?
Schedule extra staff in advance, order more inventory early, and choose dishes with low food cost for your promotions. Avoid last-minute decisions that cost you money.
Should I discount my most popular dishes during promotions?
Not necessarily. Your popular dishes already sell well at full price. Focus discounts on items with low food costs or dishes that need a sales boost instead.
How much extra waste should I expect during promotion weeks?
Expect 15-25% more waste due to kitchen stress and higher volume. Factor this into your promotion calculations or risk losing money on what seems profitable.
Can I run promotions two weeks in a row profitably?
Usually not. Staff burnout increases costs, suppliers can't always handle rush orders, and customers may expect permanent discounts. Space promotions at least 3-4 weeks apart.
Do I need to calculate with VAT for promotions?
No, always calculate food cost excl. VAT. A €20.00 dish incl. VAT is €18.35 excl. VAT at 9% VAT.
📚 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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