Restaurant Manager: Average annual salary: $51,180.Prep Cooks: Average hourly salary: $14.74.Head Chef: Average annual salary: $50,145.Here is a quick list of hourly salaries that you must consider: This cost is also a variable cost and depends on the location and various other factors. Employee SalariesĬOGS and employee salaries are the most important costs to operate a restaurant. However, the amount you pay per month will depend on a number of factors including the size of the space, location, lease or purchase, and more.Īssuming an average $40 per square foot per year in a premium location of a city like Portland, you would be paying around $7,000 per month in rent for a 2,000 square foot space. On the other hand, if you took a loan to buy the restaurant space, there will be monthly mortgage repayment. If you leased a restaurant space, you will need to pay monthly rent. The COGS in that case will be around $35,000 (assuming casual restaurant).ĭo not forget that this percentage can significantly fluctuate depending on factors like local & international supply and demand, international trade restrictions, weather and more. With an average order value of $50, the total monthly revenue would be $100,000. For instance, a steakhouse will usually have a COGS of 40%, while an Italian restaurant will have COGS of 28%.įor example, if 80 people eat at your restaurant on average in a day (65% occupancy rate based on a 120-seat restaurant, this results in 2,500 people a month (assuming 6 days a week). Of course, the cost will depend on the type of food you serve. The COGS for restaurants is usually between 28% and 35% of monthly revenue, but it can be as high as 40%. The Cost of Goods Sold is perhaps the most important operating cost you must account for when operating a restaurant. Note that these costs are for illustrative purposes and depend on a number of factors as explained earlier. So, we have decided to give you below a clear overview of all the key expenses you can expect for starting a casual restaurant with 120 seats. In addition to startup costs, there are also a number of operating costs to run a restaurant. Source: Restaurant financial model template 3. Instead of using separate menu items, we recommend to group them under categories instead (e.g. Now you can obtain your revenue projections broken down by the type of product categories as shown below. That way, you can now multiply the number of customers for each product by their respective price to obtain revenue. 15% buy a dessert for $6.50, and so on.another 60% buy a main at an average price of $20.00. 30% of the customers may choose to get a starter at an average price of $12.00.Let’s see now how.įirst, break down the products into a percentage of your total customers. Indeed, as you know all these products have very different unit economics (prices and profit margins) you need to forecast accurately. It’s very important to break it down right. Indeed, most of you customers may buy a main at an average price of $20.00, yet some may also buy other products such as starter for $12.00, desserts for $7.00 or even alcoholic drinks for $6.50 on average. Yet, before we do so, we must break down the number of customers into the different products they may buy. Now that we have estimated the number of customers over time, we can calculate revenue. That way, you will be able to forecast accurately the number of customers you can serve over time, as well as the revenues which we will now see in the next section.Ĭustomers can be represented under different formats: either between weekday and weekends or between breakfast, lunch and dinner as shown in the examples below. Tip: the values you enter can be set over time, for example for each year as shown in the example below. Days you are open in a week on average (for example 3 weekdays and 2 weekend days if you are open Wednesday to Sunday).Customers on a weekend day instead (breakfast, lunch and dinner).Customers you expect to serve on average on a weekday (breakfast, lunch and dinner).The guidelines below are our recommendations to create accurate and flexible customer projections for any restaurant:įorecasting customers can be done as follows. You can do it the easy way or make it more complex based on your requirements. The first thing you must do to create a financial model for your restaurant is to forecast the number of customers you will serve over time. In this article we’ll explain you how to create powerful and accurate financial projections for a typical 120 seats restaurant. Whether you want to understand what’s your breakeven, your valuation or create a budget for your restaurant business plan, you’ve come the right way.
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