Small Restaurant Break-Even Point: About $81K Monthly Sales

Fixed costs $45.8K Monthly base cost

Contribution margin 89.3% After variable costs

Break-even revenue $51.3K Monthly target sales

Break-even timing Month 14 Model payback point

Break-even calculator

Test monthly revenue against variable expenses and fixed monthly costs to see where the restaurant breaks even.

Lean Base Full

Monthly revenue Revenue is the top line that funds direct costs and overhead. $ Slower month Busy month Variable expenses These are direct costs that usually rise with sales, like food, wine, and processing fees. $ Tight costs Higher costs

Money available to cover fixed costs $77,000 $88,000 revenue - $11,000 variable expenses

Margin ratio

88%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base the restaurant must cover before profit. $ Lean setup Heavier setup

Break-even chart Revenue Total costs

Which restaurant expenses are fixed, and which move with sales?

Cost classification

Break-even is only useful if each expense moves the right way in the model. Here, rent and core salaries stay fixed, while ingredients and card fees move with sales; treating all payroll as variable would overstate safety.

Expense	Cost	Break-Even Treatment	Common Mistake
Rent	Fixed	Use $12,000 per month across the planning range.	Spreading rent per guest and making it look variable.
Utilities	Fixed	Use $1,500 per month in this model.	Assuming utilities rise directly with every cover.
Business Insurance	Fixed	Use $400 per month as a recurring operating expense.	Leaving insurance out because it does not tie to sales.
Payroll Taxes & Benefits	Fixed	Use $8,250 per month as modeled overhead.	Treating all payroll-related items as variable labor.
Head Chef salary	Fixed	Keep the salaried kitchen lead in fixed overhead.	Moving chef pay with daily guest count.
Servers wages	Semi-fixed	Add staffing in steps as service volume rises.	Modeling server payroll as a perfect percent of sales.
Wine & Liquor Cost	Variable	Use 10.0% of sales in the first year.	Using a flat dollar budget instead of sales-linked usage.
Credit Card Processing Fees	Variable	Use 2.5% of sales in the first year.	Forgetting fees rise as ticket volume grows.

How does break-even change from a lean dining room to a fuller service format?

Scenario table

Limited seating makes table turns, Friday-Saturday demand, and labor steps the main swing factors. As covers and check size rise from lean to full, revenue grows faster than fixed costs, so the break-even cushion widens.

These are planning assumptions, not guarantees; actual table turns, check sizes, and labor mix can move break-even.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean dining case	$84,300	$16,017	$65,750	81.0%	$2,533	Revenue sits just above the ~$81,200 break-even line.
Base dining case	$142,700	$25,829	$70,350	81.9%	$46,521	Revenue clears the ~$85,900 break-even line with room to spare.
Full dining case	$210,100	$35,927	$74,950	82.9%	$99,223	Revenue stays well above the ~$90,400 break-even line.

What breaks the break-even plan for this small restaurant?

Stress test

Year 1 has only about a $3,100 monthly cushion: sales near $84,300 versus break-even near $81,200. A 10% sales miss, higher payroll before volume, or more waste can push this plan into monthly loss fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change from the base plan.	$81,200	$3,100 cushion	Weak midweek covers leave little room.
Revenue shortfall	Sales fall 10% to about $75,900.	$81,200	$5,300 gap	That drop turns the monthly cushion into a loss.
Fixed-cost pressure	Fixed costs rise 10% to about $72,300 a month.	$89,300	$5,000 gap	Adding payroll or overhead before volume raises the burn.
Margin pressure	Variable expenses rise from 19% to 24% of sales.	$86,000	$1,700 gap	Waste, free items, and fee pressure flip profit to loss.
Combined pressure	Sales fall 10%, fixed costs rise 10%, and variable expenses rise to 24%.	$90,600	$14,700 gap	Three hits at once create a steep monthly loss.

Can this restaurant clear break-even before you sign the lease and build the kitchen?

Founder checklist

Yes—if Year 1 can hold about $81.2K in monthly sales against a $65.75K fixed burden. The quick test is 250 covers a week, $65 midweek AOV, and $85 weekend AOV, plus enough cash to carry the $396K minimum through Month 13.

1Fixed burden$81.2K/mo

Check that $12K rent still fits the full fixed load, because monthly fixed costs and wages total about $65.75K before food and drink costs.

2Weekly covers250/week

Add the Year 1 daily cover plan to 250 a week, because that is the demand base the break-even math needs before you commit.

3Ticket mix$65 / $85

Verify the $65 midweek and $85 weekend ticket holds, because those average order values drive the revenue run rate.

4Launch spend$410K

Fund the $410K capex plan and the $85K opening inventory, including $150K leasehold improvements, $60K kitchen equipment, and $45K bar equipment, so launch cash does not break the model.

5Staffing ramp9.0 FTE

Stress-test the Year 1 labor stack at 9.0 FTE before adding more semi-fixed labor, because servers, kitchen staff, and bartenders rise with volume.

6Cash cushion$396K by M13

Make sure you can carry about $396K of minimum cash through Month 13, because the model does not reach breakeven until Month 14.