By Margaret Nguyen July 1, 2025
Running a successful restaurant is not just about great food and service—it’s about data-driven decision-making. Tracking key performance indicators (KPIs) on a weekly basis allows you to see trends, address issues before they become major problems, and keep operations running smoothly. From employees and sales to customer satisfaction and food costs, these metrics give you an accurate picture of how your restaurant is truly running.
What to Know Before Tracking KPIs
1. Working Capital
Working Capital is the amount of short-term money you have to run your restaurant day to day. It is a balance of what you have and what you owe.
Formula:
Working Capital = Current Assets – Current Liabilities
Cash, inventory, and accounts receivable are current assets.
Bills, debt, and other short-term obligations are current liabilities.
Positive working capital is when your business has enough money to pay its bills and still have some backup.
2. Depreciation
Depreciation tracks the reducing value of expensive items like ovens, refrigerators, or POS equipment. It spreads the cost of equipment over time, and budgeting and taxation are simplified.
Formula:
Depreciation = (Purchase Price – Salvage Value) / Useful Life
This is the figure you use to record equipment wear and tear in your operating expense and compute future replacement.
Key Overall Performance KPIs for Restaurants
1. Total Sales
Sales are the livelihood of every restaurant. Keeping track of total revenue generated within a specific period enables you to be aware of your earning capacity and analyze other critical measures with it. One such significant figure related to sales is the break-even point—the amount of sales needed to cover all fixed and variable costs. The instant this point is reached, the company is no longer making losses.
- Break-even Point Formula: Break-even Point = Fixed Costs / Contribution Margin
The contribution margin is calculated by taking the total sales and then subtracting variable costs (e.g., ingredients and hourly wages). Fixed costs (e.g., rent and salaried staff) do not change regardless of how much you sell. This number is important to understand, especially when considering investments like new equipment or new locations.
Another very important figure is gross profit, which tells you how much money you’re making before subtracting operating expenses.
- Gross Profit Formula: Gross Profit = Total Sales – COGS (Cost of Goods Sold)
COGS encompasses all direct food production and serving food expenses, and this figure allows you to see how well your menu is driving your bottom line.
2. Sales Trends Over Time (Historical Sales)
Looking at your sales history gives you the big picture of how your restaurant is performing month-over-month or year-over-year. Monitoring sales on a daily, weekly, and monthly basis helps identify trends—e.g., holiday seasons or low-traffic days—that can be used to guide staffing, promotions, and inventory management.
As time goes on, these bits of data improve your ability to forecast demand, plan promotions, and manage costs more effectively.
3. Prime Cost
Prime cost is your two biggest expenses , which are food and labor. As it covers the majority of your variable costs, it’s one of the most important KPIs to monitor on a regular basis.
Prime Cost Formula:
Prime Cost = Labor Costs + COGS
Prime Cost as a Percentage of Sales:
(Prime Cost / Total Sales) × 100
In the majority of restaurants, the ideal prime cost has to be less than 60%. Lowering it—without sacrificing quality or service—can significantly enhance profitability. Even modest gains, like more effective scheduling or menu innovation, can pay long term results in the long term.
4. Profit Margins
Profit margin is the ratio of how much of your revenue comes through as profit. It’s an essential KPI for cost control, pricing, and general financial planning. There are different types of profit margins to track:
- Gross Profit Margin: This shows how much profit a dish is generating after covering food costs.
- Formula: (Selling Price – COGS) / Selling Price × 100
- Operating Profit Margin: Takes into account both food costs and operating expenses like rent, utilities, and staff wages.
- Formula: (Operating Income / Net Sales) × 100
- Net Profit Margin: This is your true bottom line after all costs—including taxes and interest—are deducted. It reflects how much profit you’re keeping from your total revenue.
- Formula: (Net Income / Total Revenue) × 100
Industry-standard restaurant net profit margins are between 3% and 5%, so small gains are important.
Front-of-House KPIs: Service & Guest Experience Measurement
Server Benchmarks
Servers have a direct impact on revenue and guest satisfaction. Individual performance is tracked to identify top performers and training needs.
- Per-Person Average (PPA): PPA = Server’s Total Sales / Total Guests Served
Tracks the revenue each server generates per guest.
- Guests Served per Hour: Guests Served / Hours Worked
Highlights how efficiently a server operates, but must be balanced against guest comments to avoid compromising quality.
- Server Errors per Guest: Total Server Errors / Total Items Rung In
It helps determine common errors on the POS platform that will result in lost sales or unhappy customers.
Customer Satisfaction Score (CSAT)
Customer comments—via surveys, reviews, or comment cards—provide instant feedback regarding service quality.
- Net Promoter Score (NPS): NPS = % Promoters – % Detractors Promoters rate 9–10, detractors 0–6. The higher the value, the greater customer loyalty and satisfaction.
Keeping track of CSAT enables you to catch issues early, determine top performers, and improve overall service.
Table Turnover Rate
A measure of how often tables are turned over per shift—vitally important to optimizing seating and revenue.
- Table Turnover Rate = Parties Served / Tables Available
- Example: If 30 parties are served over 15 tables during a single shift, the turnover rate is 2. More than that suggests efficient service and less than that might suggest bottlenecks in clearing, resetting, or flow in general.
Back-of-House KPIs: Back-of-House Metrics That Drive Success
Menu Item Profitability
This KPI measures the volume of profit that each item produces, which guides pricing and menu selection.
- Formula: Menu Item Profit = Selling Price – (Ingredient Cost + Direct Labor Cost)
Menu items cluster as:
- Stars: High demand, high profit
- Plow Horses: High demand, low profit
- Puzzles: Low demand, high profit
- Dogs: Low demand, low profit
Understanding simplifies your menu and expands profit margins.
COGS (Cost of Goods Sold)
COGS is a figure of what you are paying for such as food and beverage products you sell. Managing it benefits your bottom line.
Formula:
COGS = (Beginning Inventory + Purchases – Ending InventoryInventory) / Sales
Food Cost % = (Food Cost / Sales) × 100
The ideal food cost percentage is 28–35%. Liquor costs are tracked apart with similar formulas, and ideal liquor cost percentages vary—liquor (~15%), beer (~22%), and wine (~30%).
Labor Costs
Labor is usually one of the largest restaurant expenses, such as wages, taxes, and benefits. The labor cost percentage of total sales should be around 30%, but that depends on your restaurant type. Always benchmark labor based on prime cost (labor + COGS).
Staff Turnover Rate
The restaurant business has one of the highest turnover rates. Tracking this KPI helps to fix hiring and retention issues.
Formula:
Turnover Rate = (Employees Who Left / Average Number of Employees) × 100
High turnover raises the hiring and training costs. By following this figure, you can build more efficient retention strategies and reduce staffing costs.
Operational and Performance Measures
Revenue Per Available Seat Hour (RevPASH)
RevPASH helps you to measure how efficiently your restaurant is utilizing its seats to generate revenues on a per-hour basis.
Formula:
RevPASH = Total Revenue / (Number of Seats × Opening Hours)
Example:
Suppose your restaurant posted $20,000 in a day, 50 seats, and was open for 10 hours:
RevPASH = $20,000 / (50 × 10) = $40
This means each seat earned $40 per hour—a convenient measure for evaluating seating efficiency and service flow.
Inventory Turnover Ratio
This KPI measures the number of times you are selling and replacing your Inventory within a time period. A high ratio typically denotes well-controlled inventory inventory and fresh stock.
Formula:
Inventory Turnover = COGS / Average Inventory
Example:
Let’s assume COGS is $20,000, and average InventoryInventory is $5,000:
Turnover = 20,000 / 5,000 = 4
You turned in your Inventory four times during that period. Aim for balance—a level too low is wasteful; too high may signal stock shortages.
Total Sales by Server
This tracks how much money every server is generating and can be utilized to market best sellers and training sessions.
Formula:
Total Sales by Server = Sum of All Sales by Server
Example:
If a server makes $500, $600, and $700 on three shifts:
Total = $1,800
Compare the sales of your team to schedule in harmony with optimal scheduling and create reward systems based on performance. Point-of-sale systems can bring this information into today’s digital age and explore it at full length.
Food Waste
Food waste refers to the amount of food ordered and left unserved—spoiled, over-prepped, or leftover.
Formula:
Total Food Waste = Kitchen Waste + Plate Waste + Spoilage
Monitor each waste type regularly to save costs and enhance sustainability. Waste reduction enhances your bottom line and it is also an environmentally friendly measure.
Customer and Guest Metrics: The Customer Point of View
Foot Traffic (Guest Count)
Foot traffic is an easy method to gauge your restaurant’s popularity and busiest hours, helping with staffing and smart restaurant marketing information.
How to monitor:
Use a POS system or manual count to track guests in a month, week, or day.
Example:
Monday (75) + Tuesday (85) + Wednesday (90) = 250 guests in 3 days.
Compare longitudinally to determine trends and campaign success.
Customer Satisfaction Score (CSAT)
CSAT measures how happy your customers are with your food and service.
Formula:
CSAT (%) = (Number of Satisfied Customers / Total Responses) × 100
Example:
If 80 out of 100 visitors rate their experience 4 or 5 (out of 5):
CSAT = (80 / 100) × 100 = 80%
It is a quick way to monitor satisfaction and adjust for service issues.
Walk-ins vs. Reservations
This measure helps to gauge diner preference and schedule employees and table usage accordingly.
Formula:
Walk-ins vs. Reservations Ratio = Number of Walk-Ins / Number of Reservations
Example
60 walk-ins and 40 reservations = Ratio = 1.5
You then had 1.5 walk-ins for each reservation, which aids space and shift planning.
No-Show Rate
No-shows can result in lost business and underutilized tables. This KPI assists with controlling that risk.
Formula:
No-Show Rate (%) = (No Shows / Total Reservations) × 100
Example:
10 no-shows out of 100 bookings = 10% no-show rate
Think about overbooking or deposits if your rate is always high.
Cancellation Rate
Cancellations put plans at risk. Monitoring this rate allows you to refine reservation policies and plan ahead.
Formula:
Cancellation Rate (%) = (Cancellations / Total Reservations) × 100
Example:
20 cancellations from 200 reservations = 10% cancellation rate
Use this data to streamline confirmation procedures or develop flexible cancellation policies.
Technology and Digital Metrics: A Leap Ahead in a Digital-First World
Online Reservation Rate
This indicates the number of bookings being made on your website or reservation systems. This gives an indication of how effective your online reservation system is performing.
Formula:
Online Reservation Rate (%) = (Online Reservations / Total Available Seats or Tables) × 100
Example:
50 online reservations out of 100 available seats = 50% reservation rate
Monitor this to see booking trends and enhance user experience.
Sales from Online Ordering
This records how much revenue is being generated through delivery apps or your own direct ordering system—helpful to monitor customer take-up and market coverage.
How to do it:
Gross up revenue from online orders over a fixed time.
Example:
If online orders produced $5,000 in a month, your online order sales = $5,000
Use this to maximize delivery options and marketing campaigns.
Online Ratings and Reviews
Reviews and ratings matter for your restaurant’s reputation. Monitoring them gives insight into customer satisfaction and areas for improvement.
How to track:
Check on platforms like Google, Yelp, and TripAdvisor.
Calculate average Rating:
Average Rating = Total Stars / Total Reviews
Example:
50 reviews with 4.5 stars average = Overall rating = 4.5
Customer response and adjustment of service based on feedback can enhance visibility and credibility.
Marketing KPIs for Restaurants
1. Social Media Engagement
If you’re investing time (and dollars) in social media, you need to figure out if it’s worth it. These statistics tell you how people are interacting with your content:
- Likes – A quick measure of support.
- Comments – Great for measuring conversation and criticism.
- Shares – Tells you that your content is worth passing along.
- Engagement rate – Summarizes likes, comments, and shares to display total interaction.
2. Website Traffic
Your website should be up and running 24/7 to attract people. Here’s how to measure its impact with tools like Google Analytics:
- Traffic by channel – Check where visitors are coming from: organic search, social media, referrals, or ads.
- Bounce rate – Shows how many people left after only opening one page. High bounce? Something is wrong.
- Pages per session – The more pages viewed, the busier your visitors are likely to be.
3. Keyword & Search Visibility
Are customers finding your restaurant when they search online? Use keyword monitoring tools to watch for:
- Search traffic – Discover how many visitors arrive on your site via search engines.
- Keyword rankings – See where you are ranking for phrases like “brunch near me” or “best vegan restaurant.”
4. Conversions
What are people doing after finding you?
- Phone reservations – Put call tracking software in place and watch the number of visitors turn into bookings.
- Online bookings or form fills – Put conversion tracking on Google Analytics to monitor real results.
What to Do With Your Restaurant KPI Data
- Catch Trouble Early: KPIs signal problems before they become issues. Falling RevPASH? Maybe it’s slower service. Rising food costs? Waste or inefficient inventory control? Set weekly goals and track trends over time.
- Coach Your Team With Data: Don’t just correct your team. Use KPIs like average check size or error rate to support staff development and also mark victories. Arrange weekly 1-on-1s. Use measures like PPA and guest feedback to start useful, honest conversations—not performance appraisals.
- Revise Your Menu: Your menu is a revenue driver. Use item sales and food cost data to track what’s profitable and what’s not. Update the menu on a quarterly basis. Merchandise up on high-margin products and cut the under-performers.
- Staff & Schedule Optimization: Match staff to true demand. Slow revenue on weighted-labor shifts? Balance out time. Cross-check RevPASH with labor cost by shift. Refine schedules where labor is high, but sales are low.
- Plan Growth Wisely: Thinking of expanding or launching new services? Your KPIs will inform you if you are ready—or not. Leverage a simple-to-consume monthly dashboard with key metrics (sales, profit margin, prime cost). Present it to partners or investors to build credibility.
- Build a Data Culture: Bring data to the beat. Celebrate the little victories, talk about the difficulties openly, and make optimizing a group goal.
Conclusion
Weekly monitoring of restaurant KPIs is less about crunching numbers than it is about staying ahead. With a clear picture of your sales, employees, guest satisfaction, and operations, you make smarter decisions, run more efficiently, and fuel bottom-line growth. By taking data to action, you create a restaurant that performs better today and prepares for tomorrow.
FAQs
1. Why do restaurants have to monitor KPIs weekly?
Weekly tracking catches issues early, tracks real-time performance, and allows rapid adjustments to improve operations and profitability.
2. What KPIs are of most importance to restaurant success?
The most important KPIs are sales, prime cost, labor cost, customer satisfaction, and table turnover rate for well-rounded operational intelligence.
3. How do I track restaurant KPIs efficiently?
Employ POS systems, inventory software, and analysis tools to automatically collect and report performance data by department.
4. What is the difference between COGS and prime cost?
COGS refers to food and beverage costs; prime cost includes COGS along with total labor cost for a full view of profitability.
5. How is team performance boosted with KPIs?
KPIs identify leading performers and training opportunities, allowing you to coach employees with real facts instead of guesses.