Restaurants make 70% profit on food!?

[JEDI]

http://restaurants.about.com/od/menu/a/foodcost.htm

Generally, food cost should be around 30-35%. This means that if you pay $1.00 for something, you need to charge minimum of $3.34.

The initial cost of a filet mignon dinner can be broken down into the following areas:

• The beef filet costs you $6.00 per portion
• The wrap (the potato, vegetable, salad and bread that comes with the filet, as well as any condiments the guest asks for) costs $2.50

Therefore, the entire meal costs you $8.50.
at 65% profit, charge $24.29 at MINIMUM. (Bump it to 24.99 to make the numbers less awkard.)


wow.. thought liquor was around 70% profit, and foods were around 25% profit.

so if food is 70% profit, how much profit for liquor?

 

[M0oG0oGaiPan]

how much food goes wasted?

 

[FleshLight]

You need to look up the words "revenue", "overhead", and "margin"

 

[RavenSEAL]

Liquor is pure profit, all you do is shove a ton of corn and water in an aluminum tank.

6 months later? CHA CHING

 

[MovingTarget]

Interesting, but hardly surprising. They make a lot of profit on food, but that being said, it is extremely difficult to make it in the restaurant industry.

 

[busydude]

What kind of a magical restaurant is this?

 

[Bignate603]

It's called overhead. You've got to pay the wait staff, the kitchen staff, the bartender, the hostess, the busboy, etc. Then you've got rent, utilities, insurance, and other monthly bills.

Even with those huge markups many restaurants struggle and a ton of them fail because of all those other costs.

 

[rh71]

First thing I thought of is how people say the tipping system is supposedly helping to keep the price of food down because the owners don't have to pay the staff as much. Yeah, that's a great line.

 

[Pliablemoose]

Also, news flash, water is wet.

I mean seriously, it's grade school math and actually setting foot in a grocery store, holy fuck...

 

[gorcorps]

Not surprising. Though it doesn't sound like it includes all of the other overhead like salary for staff, rent on building, energy, etc. The article mentions it but doesn't give an estimate on what that would cost per item.

 

[Wreckem]

The average restaurant makes a profit of $0.04 per $1.00 spent by a customer. Of course that's average, on one extreme you have high end restaurants making much more than that, on the other you have more restaurants failing then succeeding.

 

[Wreckem]

First thing I thought of is how people say the tipping system is supposedly helping to keep the price of food down because the owners don't have to pay the staff as much. Yeah, that's a great line.

Labor is part of the price. Tipping keeps overall prices down because it keeps labor costs down.

 

[WaTaGuMp]

So, this is one of those profit making business scams?

 

[mmntech]

It's called overhead. You've got to pay the wait staff, the kitchen staff, the bartender, the hostess, the busboy, etc. Then you've got rent, utilities, insurance, and other monthly bills.

Even with those huge markups many restaurants struggle and a ton of them fail because of all those other costs.

Yep, profit =/= revenue. Revenue - expenses = profit.

 

[Zedtom]

The business is tough, but the biggest hurdle is not really turning ingredients into finished product, it's keeping a staff.

The chefs are always being lured away if they're good, and the bad ones are followed by the worse. The manager must be fluent in two languages and the payroll is constantly being revised.

 

[OverVolt]

Restaurants are popular among people who have no business sense, so if you are capable of running a good business don't let the 4 cents on the dollar scare you, its probably around 7% profit like all other businesses and then a bunch of failure business averaged in.

 

[WaTaGuMp]

The manager must be fluent in two languages .

German and Portuguese?

 

[MovingTarget]

German and Portuguese?

English and Français?

 

[OverVolt]

I think english/spanish

 

[JEDI]

It's called overhead. You've got to pay the wait staff, the kitchen staff, the bartender, the hostess, the busboy, etc. Then you've got rent, utilities, insurance, and other monthly bills.

Even with those huge markups many restaurants struggle and a ton of them fail because of all those other costs.

reading comprehension much?

i said profit off of food.
not overall restaurant profit.

 

[Via]

The restaurant I managed was costed at a 3-4% profit iirc.

That business is hell.

 

[Gintaras]

Don't go to restaurant - cook yourself. Save 70%

Get your budget balanced, if you want to go to restaurant:
Don't fuck your gf/wife for free - make a porno movie and sell.
Hopefully, it will cover restaurant meat and drinks profit....

 

[dawp]

Liquor is pure profit, all you do is shove a ton of corn and water in an aluminum tank.

6 months later? CHA CHING

it's a little more complicated than that, and depending on the grain(not all liquor is corn based), the process varies.

 

[waggy]

well duh?

i would think its common sense that they make about that much profit off the food. does that fact really suprise you? WTF else are they makeing money on? the happy endings in the back?

After you count in everything the real profit of the restaurant sucks ass. They are so damn thin that it is not a business i would care to be in. not to mention i suck at cooking heh.

 

[WelshBloke]

how much food goes wasted?

A crap ton, unless there's only one item on the menu and they know in advance exactly how many people are going to turn up to eat.