Restaurant labor cost percentage calculator

Add up hourly wages, salaries and payroll overhead for a period and compare them with sales for the same period to get your labor cost percentage. Nothing is saved or sent anywhere.

Kitchen hours Kitchen hourly rate ($) Front-of-house hours Front-of-house hourly rate ($) Salaries for the period ($) Payroll overhead % Sales for the period ($) Target labor %

Use the same period for every number (a week or a month). Payroll overhead is your own figure for employer taxes, benefits and insurance as a % of wages.

Labor is half the story; know your food cost too. The Recipe Cost Workbook keeps one ingredient price list for every recipe, handles kg/g, l/ml and dozen, and adds labor, packaging and overhead. $12, instant .xlsx download.

How it works

Wages = kitchen hours × kitchen rate + front-of-house hours × front-of-house rate + salaries. Payroll overhead = wages × overhead %. Labor cost = wages + overhead. Labor % = labor cost ÷ sales. Sales for target = labor cost ÷ target labor %.

Worked example (the values above): kitchen wages are 160 × $18 = $2,880, front of house is 140 × $14 = $1,960, plus $1,500 salaries, so wages are $6,340. Overhead at 12% is $760.80, making labor cost $7,100.80. Against $22,000 of sales that is $7,100.80 ÷ $22,000 = 32.3%. To bring the same labor cost to 30% you would need $7,100.80 ÷ 0.30 = $23,669.33 of sales.

Your payroll overhead % depends on your location and benefits, so take it from your payroll records rather than a rule of thumb. For food and labor together, use the prime cost calculator. See also the free recipe cost calculator and more calculators.