Restaurant margin calculator
Calculate food cost percentage, menu pricing, and contribution margin. Includes industry benchmarks for fine dining, fast casual, and bars.
Fill in any two. The other two calculate automatically. Click a locked field to edit it instead.
Restaurant margin calculator benchmarks
Restaurants run on volume against thin net margins. Food cost — what you pay for ingredients — typically lands at 28-32% of menu price, giving a gross margin of 68-72%. After labor, rent, utilities, and waste, the net margin shrinks to 3-9% for most restaurants. Bars and beverage-heavy concepts do better.
Menu pricing from food cost
The standard formula: divide ingredient cost by your target food cost percentage. A burger that costs $3.20 in ingredients, targeting 25% food cost, should be priced at $3.20 ÷ 0.25 = $12.80. Bump that to $14 to round nicely and you're at 22.9% food cost — a comfortable spot.
Category benchmarks
| Concept | Food cost | Gross margin | Net margin |
|---|---|---|---|
| Fine dining | 30-35% | 65-70% | 5-12% |
| Casual / family | 28-32% | 68-72% | 3-6% |
| Fast casual | 25-30% | 70-75% | 6-9% |
| Quick service | 26-30% | 70-74% | 6-9% |
| Coffee shop | 20-25% | 75-80% | 2-8% |
| Bar / pub | 18-24% (food), 15-20% (alcohol) | 76-85% | 5-15% |
Frequently asked
What's a good food cost percentage?
28-32% for most concepts. Below 25% may hurt portion perception or quality; above 35% is unsustainable unless balanced by very high volume.
How do I price a new menu item?
Calculate ingredient cost per portion (don't forget oil, spices, garnish, waste — add 5-10% to raw ingredient cost). Divide by your target food cost. Adjust to a clean price point.
Why are beverage margins so much higher than food?
A glass of wine costing $3 in bottle costs and sold for $14 has a 79% margin. Beverages have minimal prep labor, no spoilage when bottled, and customers expect markup. They're how most restaurants actually make money.
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