Restaurant Labor Cost Percentage Calculator
Labor cost percentage is one of the most important metrics for running a profitable restaurant. Enter your total labor costs and total sales for a given period to see what share of revenue goes to payroll, and compare it to the typical 25-35% industry benchmark.
About this calculator
Calculate your restaurant's labor cost as a percentage of sales to see if your staffing spend is within a healthy industry range.
Frequently Asked Questions
What is a good labor cost percentage for a restaurant?
Most full-service restaurants aim for 25-35% of sales going to labor, while quick-service restaurants often target 25-30%. The ideal range depends on your service style, menu, and location.
How is labor cost percentage calculated?
Labor cost percentage is calculated by dividing total labor costs (wages, salaries, payroll taxes, benefits) by total sales for the same period, then multiplying by 100.
Should I include payroll taxes and benefits in labor cost?
Yes, for an accurate picture you should include all payroll-related expenses such as taxes, benefits, and workers' comp insurance, not just gross wages.
How often should I calculate this metric?
Many operators track labor cost percentage weekly or per pay period to catch scheduling issues early, in addition to reviewing it monthly for broader trends.