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What’s Contribution Margin and Breakeven Point? 👇🏼 Contribution Margin = Menu Price – Food Cost Two items can have the same price and still produce completely different profit outcomes. For example: 🍕 $10 Pizza → $3 food cost → $7 contribution margin 🍗 $10 Wings → $6 food cost → $4 contribution margin When your weekly fixed costs are $10,000, that difference is everything: 🍕 You’d need 1,428 pizzas to break even 🍗 Or 2,500 orders of wings This is why national chains like Chipotle, Texas Ro
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Don’t mix up Contribution Margin and Gross Margin. Most restaurant owners get confused and it’s costing them. Gross margin tells you if your operations are bleeding or thriving. Contribution margin tells you which menu items are actually worth selling. One drives efficiency. The other drives menu decisions. 👉 Follow @Owner for more restaurant math that makes you money. | Owner.com
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