How Do You Calculate Restaurant Profit?
Restaurant profit is calculated by subtracting total expenses from total revenue. The revenue includes all money received from customers for food and drinks. The expenses include the cost of goods sold (ingredients, supplies, and labor), rent, utilities, licenses, insurance, taxes, and any other operational costs. The profit margin is the percentage of revenue that remains after deducting all expenses. For example, if total revenue is $100,000 and total expenses are $80,000, the profit is $20,000 and the profit margin is 20%.