Vero -- Tools for Restaurant Operators
Most independent restaurants that close did not die from a single bad month. They died from three or four months of small margin problems that were not caught early because no one was looking at the numbers weekly. A P&L tracker used consistently is one of the cheapest insurance policies in the business.
A monthly P&L tells you what happened. A weekly tracker lets you intervene before the problem compounds. If food cost runs high in week two of the month, you can adjust purchasing in week three. On a monthly review cycle, you find out in the second week of the following month -- after the damage is done four more times.
The weekly format does not need to be as detailed as the monthly. It needs to capture the three numbers that move fastest: revenue, food cost percentage, and labor cost percentage.
| Category | Industry benchmark | Note |
|---|---|---|
| Total revenue | -- | Food + beverage + other (retail, events) |
| Food cost | 28-32% of food revenue | Ingredients only; exclude non-consumables |
| Beverage cost | 18-24% of beverage revenue | Track food and beverage separately |
| Labor cost | 28-35% of total revenue | Include taxes, insurance, and benefits |
| Occupancy | 5-10% of revenue | Rent, NNN charges, property insurance |
| Utilities | 3-5% of revenue | Gas, electric, water |
| Repairs and maintenance | 1-2% of revenue | Treat as a monthly accrual, not just when spent |
| Marketing | 1-3% of revenue | Paid ads, print, delivery platform fees |
| Admin and supplies | 1-2% of revenue | Smallwares, cleaning, office |
| Prime cost | 55-65% of revenue | Food cost + beverage cost + labor. The most watched number. |
| EBITDA | 10-15% of revenue | Below 8% is a survival problem |
Prime cost is food cost + beverage cost + labor cost, expressed as a percentage of total revenue. It is the single number that best predicts whether a restaurant is financially healthy. Above 70%: the business is consuming itself. Between 65-70%: operational focus needed. Under 60%: excellent.
When prime cost runs high: investigate which component is off. Food running high = purchasing problem or waste problem. Labor running high = scheduling problem or revenue-per-hour-worked problem.
Calculate weekly: (Opening inventory + Purchases - Closing inventory) / Food revenue. Do not use POS cost-of-goods estimates -- actual inventory variance is where the real number lives. A food cost percentage that creeps up gradually is almost always waste or theft before it is a pricing problem.
Labor as percentage of revenue is a scheduling efficiency metric as much as it is a cost metric. Calculate it by day of week and time of day. The goal is to identify the shifts where you are over-staffed relative to revenue -- these are the controllable hours.
The weekly entry should take 20-30 minutes maximum. The inputs come from three sources: your POS end-of-week report, your payroll system, and your invoice folder. If you are spending more than 45 minutes per week on data entry, your tracker is too complex -- simplify it.
Set a standing calendar event: every Monday, 9am, 30-minute P&L entry. Do not move it. After 8 weeks you will know your numbers by feel, and the entry will take 15 minutes.