Food Business Break-Even Calculator
How many units do you need to sell each month to cover your costs? Enter your prices and costs to find your break-even point instantly. Includes presets for ghost kitchens, restaurants, cafes, food trucks, bakeries, and catering.
UK Food Business Break-Even Benchmarks (2026)
| Business Type | Monthly Fixed Costs | Avg Unit Price | Typical Break-Even | Contribution Margin |
|---|---|---|---|---|
| Ghost Kitchen | £3,500–£6,500/mo | £20 order | 30–35 orders/day | 45–55% |
| Restaurant | £8,000–£15,000/mo | £22 cover | 20–30 covers/day | 60–70% |
| Cafe | £5,000–£9,000/mo | £8 transaction | 25–40 sales/day | 65–75% |
| Food Truck | £2,000–£4,000/mo | £12 order | 8–15 orders/day | 55–65% |
| Bakery | £4,500–£8,000/mo | £6 item | 35–55 sales/day | 60–70% |
| Catering | £3,500–£6,000/mo | £30/head | 8–12 events/mo | 55–65% |
Benchmarks are indicative ranges based on UK market data. Your actual break-even will vary based on location, menu, and operational efficiency.
How to Lower Your Break-Even Point
Increase prices strategically
A 10% price increase typically reduces break-even units by 15–25%. Most customers accept small price rises (£1–2) if portion sizes and quality stay consistent. Test on one platform first.
Reduce food waste below 5%
Use cross-menu ingredients, batch prep based on historical orders, and implement strict FIFO rotation. Every 1% reduction in waste saves approximately £100–£200/month for a typical operator.
Negotiate fixed costs annually
Kitchen rent, insurance, and software subscriptions are all negotiable. After 6–12 months of reliable tenancy, request a rent review. Switching insurance providers annually often saves 10–20%.
Build direct sales channels
Every order taken through your own website (0% commission) vs platforms (20–35% commission) dramatically reduces variable cost per unit. Even 15% direct orders can lower break-even by 10%.
Optimise staffing to demand
Use part-time staff for peak hours instead of full-time for all shifts. A ghost kitchen doing 80% of orders between 5pm–9pm doesnt need full-time staff from 10am.
Break-Even Formula Explained
Fixed Costs
Costs that stay the same regardless of how many units you sell: rent, staff salaries, insurance, base utilities, software subscriptions.
Variable Costs
Costs that increase with each unit sold: food ingredients, packaging, delivery platform commission, payment processing fees.
Contribution Margin
Selling price minus variable cost per unit. This is how much each sale "contributes" toward covering your fixed costs and eventual profit.
Related Guides
Written by
James Mitchell
Ghost Kitchen Operations Director & Industry Expert
Frequently Asked Questions
What is the break-even point for a food business?
The break-even point is the number of units (meals, orders, or products) you need to sell each month to cover all your costs — both fixed (rent, staff, insurance) and variable (ingredients, packaging, commissions). Below this point you make a loss; above it, every additional unit sold is profit. For a typical UK ghost kitchen, break-even is around 30–35 orders per day.
How do you calculate break-even for a restaurant?
Break-even units = Total Fixed Costs ÷ Contribution Margin per Unit. The contribution margin is your selling price minus variable costs per unit (food, packaging, commission). For a UK restaurant with £11,500/month fixed costs and £16 contribution margin per cover, break-even is about 720 covers per month or 24 per day.
What is a good contribution margin for a food business?
A healthy contribution margin for UK food businesses ranges from 55–70% of selling price. Ghost kitchens typically see 45–55% (lower due to delivery commissions), restaurants 60–70%, cafes 65–75% (coffee has very high margins), and catering 55–65%. If your contribution margin is below 40%, it will be very difficult to cover fixed costs.
How long does it take a food business to break even?
Most UK food businesses take 3–12 months to consistently operate above break-even. Ghost kitchens are fastest at 3–6 months due to lower fixed costs. Restaurants take 6–12 months. Cafes typically break even in 4–8 months. Catering businesses take 6–12 months to build a reliable client base, though individual events are profitable from day one.
What are typical fixed costs for a UK food business?
Typical monthly fixed costs: Ghost kitchen £3,500–£6,500 (rent £1,500–£2,500, staff £1,200–£2,400, utilities £300–£500). Restaurant £8,000–£15,000 (rent £3,000–£5,000, staff £4,000–£8,000, utilities £600–£1,000). Cafe £5,000–£9,000. Food truck £2,000–£4,000. These vary significantly by location — London costs 40–60% more than regional cities.
How can I lower my break-even point?
Three ways to lower break-even: (1) Increase selling price — even a 10% rise can reduce break-even units by 15–25%. (2) Reduce variable costs — negotiate supplier prices, reduce waste, use cross-menu ingredients. (3) Cut fixed costs — negotiate rent, share kitchen space, use part-time staff during slow periods. The calculator above shows the impact of each approach.
What is the margin of safety in a food business?
Margin of safety measures how far your current sales are above break-even, expressed as a percentage. If break-even is 800 units and you sell 1,000, your margin of safety is 20% — meaning sales could drop 20% before you start losing money. A healthy food business should aim for 15–25% margin of safety to handle seasonal dips and unexpected costs.
Should I include delivery platform commission in variable or fixed costs?
Platform commissions (Deliveroo 25–35%, Uber Eats 20–30%, Just Eat 14–25%) should be included in variable costs because they are charged per order. This means your variable cost per unit includes food ingredients + packaging + platform commission. For a £20 order with 30% food cost and 25% commission, variable cost is £11 (£6 food + £5 commission).
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