You can use a break-even analysis for a restaurant spreadsheet as a restaurant break-even point calculator.īelow, you can download our free restaurant break-even analysis excel template. Break-Even Analysis for Restaurant Spreadsheet An upscale steakhouse with a 200-person dining room, not so much. A lemonade stand probably breaks even after a few hours with around $10 in sales. The average break-even point for a restaurant is 100% dependent on that restaurant’s costs and revenue. After the third year is when bars and restaurants should begin making a profit. For healthy operations, a restaurant's break-even point is typically met in year 2 or 3. In general, bars and restaurants won’t break even in their first year. What Is Average Break-Even Point for a Restaurant? Learning how to reduce costs in a restaurant is one way to lower that break even cost. The Elbow Room needs $31,818 in monthly revenue to break even. When we divide it by four for a monthly break-even point, we get $31,818. The Elbow Room needs to bring in $127,272 every quarter to break even.īut a restaurant break-even analysis is probably more useful monthly. We calculated this break-even point based on quarterly numbers. Their bar manager consults their profit and loss statement and notes the following figures for the last quarter: Break-Even Analysis: Restaurant Break-Even ExampleĬonsider the hypothetical cocktail bar The Elbow Room. Now that we’re familiar with the restaurant break-even formula, let’s look at an example. The restaurant break-even formula is: Break-Even Point = Fixed Costs / What Is the Break-Even Point Formula for Restaurants? Unlike other formulas, you need to make sure to account for every single cost you incur or your break-even point will not be calculated properly and you may end up missing out on profits. This means understanding your break-even cost is vital to calculate the break-even point and move beyond it into profit. Your break-even point is essentially the mark where your restaurant costs and revenue total 0. What Is Break Even Cost?īreak-even cost is the total of your fixed and variable costs. Once you’ve pulled up your total sales from your bar inventory platform or POS, the break-even calculations can begin. BinWise Pro, for example, makes it easy to immediately pull up sales numbers with its SmartView Report. Total SalesĬheck your bar inventory software for historical revenue.
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