Catering Profit Calculator

Example: $1M revenue business

Traditional Approach to Estimating Profits

Cost items scale with revenue, meaning profit margin stays the same regardless of scale

Traditionally, cost is allocated by the 30-30-30-10 rule, which leaves a 10% target profit, with lots of fixed assumptions for overhead and labor. It also tends to do interesting things like putting commission and payroll taxes into overhead.

Year 1 Year 2

Revenue

Revenue $ {{revenue.number | currency }} {{ vm.results.revenue | currency}}
Revenue Growth %

Cost

Food % {{vm.costFood / 100 * revenue.number | currency }} {{vm.costFood / 100 * vm.results.revenue | currency }}
Labor % {{vm.costLabor / 100 * revenue.number | currency }} {{vm.costLabor / 100 * vm.results.revenue | currency }}
Overhead % {{vm.costOverhead / 100 * revenue.number | currency }} {{vm.costOverhead / 100 * vm.results.revenue | currency }}
Total Costs {{ (100 - vm.results.costs)/100 * revenue.number | currency }} {{ (100 - vm.results.costs)/100 * vm.results.revenue | currency }}

Profit

Profit (%) {{ vm.results.costs }}% {{ vm.results.costs }}%
Profit ($) {{ vm.results.calcProfitInDYearTwo | currency}} {{ vm.results.calcProfitInD | currency}}

Chefalytics Approach to Estimating Profits

Large fixed costs remain same as business scales, resulting in higher profit expectations with growth

We focus on separating out fixed from variable costs, as this allows you to best understand the impact of additional sales for your same facility rent as well as a much clearer understanding of what drives your profits, and how different initiatives might best improve your profits.

The takeaway from this example is that rather than expecting a profit of $15K for an additional $150K in sales, this company should instead expect a $48K increase (38% more profit on the 15% increase in sales), due to high incremental margins after paying down rent and overhead. In our experience, this makes it much more interesting/ valuable to focus on capturing a little extra revenue every month - in our business it meant expanding our drop-off line.

Year 1 Year 2

Revenue

Revenue {{ revenue.number | currency}} {{ cf.results.revenue | currency}}
Revenue Growth {{growth.number}}%

Revenue Breakdown

Food % {{ cf.results.revenueDriversChefFood | currency}} {{ cf.results.revenueDriversChefFoodYearTwo | currency}}
Staffing % {{ cf.results.revenueDriversChefStaffing | currency}} {{ cf.results.revenueDriversChefStaffingYearTwo | currency}}
Rentals % {{ cf.results.revenueDriversChefRentals | currency}} {{ cf.results.revenueDriversChefRentalsYearTwo | currency}}
Planning % {{ cf.results.revenueDriversChefPlanning | currency}} {{ cf.results.revenueDriversChefPlanningYearTwo | currency}}
Other % {{ cf.results.revenueDriversChefOther | currency}} {{ cf.results.revenueDriversChefOtherYearTwo | currency}}

Variable Cost

Food COGS (Margin = {{100 - cf.foodCogs}}%) % {{cf.results.calcFoodCogs | currency}} {{cf.results.calcFoodCogsYearTwo | currency}}
Staffing COGS (Margin = {{100 - cf.staffingCogs}}%) % {{cf.results.calcStaffingCogs | currency}} {{cf.results.calcStaffingCogsYearTwo | currency}}
Rental COGS (Margin = {{100 - cf.rentalCogs}}%) % {{cf.results.calcRentalCogs | currency}} {{cf.results.calcRentalCogsYearTwo | currency}}
Planning COGS (Margin = {{100 - cf.planningCogs}}%) % {{cf.results.calcPlanningCogs | currency}} {{cf.results.calcPlanningCogsYearTwo | currency}}
Other COGS (Margin = {{100 - cf.otherCogs}}%) % {{cf.results.calcOtherCogs | currency}} {{cf.results.calcOtherCogsYearTwo | currency}}
Total: Cost of Goods Sold (COGS) {{cf.results.sumOfCogs | currency}} {{cf.results.sumOfCogsYearTwo | currency}}

Cost of Sales

Sales % {{ cf.results.costOfSalesChefSales | currency}} {{ cf.results.costOfSalesChefSalesYearTwo | currency}}
Marketing % {{ cf.results.costOfSalesChefMarketing | currency}} {{ cf.results.costOfSalesChefMarketingYearTwo | currency}}
Total: Cost of Sales {{cf.results.valueSalesSum | currency}} {{cf.results.valueSalesSumYearTwo | currency}}

Fixed Costs

Facility $ {{cf.facility | currency}} {{cf.facility | currency}}
Equip/Maint $ {{cf.equip | currency}} {{cf.equip | currency}}
Administrative $ {{cf.administrative | currency}} {{cf.administrative | currency}}
Total: Fixed Costs {{ cf.results.fixedCostsChefSum | currency}}{{ cf.results.fixedCostsChefSum | currency}}
Total: Costs {{ cf.results.fixedCostsChefSum + cf.results.valueSalesSum + cf.results.sumOfCogs | currency}} {{ cf.results.fixedCostsChefSum + cf.results.valueSalesSumYearTwo + cf.results.sumOfCogsYearTwo | currency}}

Profit

Profit ($) {{ cf.results.totalMasterProfit | currency}} {{ cf.results.totalMasterProfitYearTwo | currency}}
Profit (%) {{ cf.results.profitTotalFinalPercent | toPercent}}% {{ cf.results.profitTotalFinalPercentYearTwo | toPercent}}%
Profit Increase (Year Two) {{ cf.results.curIncreaseInPercentage | toPercent }}% {{ cf.results.curIncreaseInProfit | currency}}