Restaurant ROI Calculator | How to Calculate ROI for Restaurants
Restaurant ROI Calculator Formula
Want to see what your return could be with SynergySuite for your back of house management solution? Enter your current costs and management methods to calculate your potential savings. Our clients see on average, a 2%-5% increase in savings on labor, as well as food costs. Are you ready to streamline operations and increase revenue?
Calculate how much your restaurants can save on prime costs with SynergySuite
Boosting restaurant ROI is a complicated process. From startup costs to inventory management, there’s plenty to focus on. And while there’s a lot to keep track of if you want to run a successful business, you don’t have to go it alone.
We’re here to help with software that makes it easy to manage inventory, increase staff productivity, and improve profit margins.
Let’s get started on taking your restaurant to the next level and improving your return on investment.
Understanding Restaurant ROI FAQ’s
Opening a restaurant is a big financial commitment. From lease payments and startup costs to ongoing inventory and staff expenses, there are plenty of bills to pay.
Naturally, you’ll want to know when you can expect a return on your investment and also get a feel for what is a good restaurant return on investment. This post will help with that, and our restaurant ROI calculator will help you figure out how much you can save with SynergySuite.
How long does it take to get a return on your restaurant investment?
Generally, you can plan on at least three to five years as your break-even point. This is calculated by determining when the net profits equal the cost of investment. Expect the first year or two to be very difficult, but if you can weather the storm and push through the tough times, you may be able to turn a good monthly ROI.
What is a good ROI for a restaurant?
While there are many factors to consider, in general, a good restaurant ROI ranges from 15 to 25 percent. For that reason, it’s very rare for a restaurant that’s less than 3 years old to even turn a profit. A 25% annual profit vs capital is a difficult milestone to reach and a very small percentage of restaurants actually get there.
How do you calculate ROI on a restaurant?
The formula for calculating restaurant ROI is quite simple. Just take the gain from investment and subtract the cost of investment (including operational and startup costs). Then divide it by the cost of investment and multiply by 100. This will give you the restaurant ROI as a percentage.
Restaurant ROI formula calculation:
(Gain from the investment – the cost of investment)/ cost of investment x 100= ROI as a percentage.
$500,000 – $400,000 / $400,000 = .25 x 100 = 25% ROI
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“We religiously do inventory across our organization and we review our variances on a weekly basis, and put in action plans against any opportunities. This past year, we ran a food and paper cost of 26.5% across our organization, which was a record year for us.”
