Break Even Calculator

How to use this tool

1. Enter fixed monthly costs (rent, insurance, salaried managers, etc.).
2. Enter variable cost percentage (food, paper, hourly labor tied to sales).
3. Add average check size and days open per month.
4. Optionally enter current monthly sales to see profit/loss and safety margin.

Formula explanation

Contribution margin = 1 − variable cost %. Break-even monthly sales = fixed costs ÷ contribution margin. Break-even daily = monthly ÷ days open. Covers = break-even sales ÷ average check.

Example calculation

Fixed costs $32,000/month, variable costs 65% of sales. Contribution margin = 35%. Break-even = $32,000 ÷ 0.35 = $91,429/month. At $42 average check = ~2,177 covers/month.

What this means for your restaurant

Break-even is your minimum viable sales line. Operators who track it weekly make faster decisions on promotions, staffing, and cost cuts.

Common mistakes

• Treating all costs as fixed or all as variable.
• Using revenue instead of contribution when estimating.
• Forgetting loan payments or owner draw in fixed costs.
• Ignoring seasonality when setting one monthly target.

Pro tips

• Update break-even quarterly or when rent, labor, or menu mix shifts.
• Track break-even by daypart if lunch and dinner economics differ.
• Use with food cost and labor calculators to tighten variable cost assumptions.
• Set a sales buffer above break-even for reinvestment and reserves.