Gross Profit Calculator
What you actually make on a dish once VAT and wastage are dealt with honestly.
Enter the menu price as your customer sees it. VAT and wastage are handled below, those are the two places GP is usually overstated.
The price on the menu. The calculator strips VAT to get the sales figure that counts.
20% for eat-in and hot takeaway. Cold takeaway food is often zero-rated, set 0 if so.
What the portion costs you, net of VAT. Use the recipe cost, not the case price.
Trim, spoilage, overpours, staff error, comps. Costing at zero wastage is the second most common way GP gets overstated.
Used only for the last two results, what you would need to charge to hit it.
Set to your platform rate to see the same dish sold through delivery. Zero for dine-in.
Used for the weekly cash figure.
How true gross profit is worked out
Three steps, and the first two are where it usually goes wrong:
- Net sales = menu price ÷ (1 + VAT rate). VAT belongs to HMRC, so it never counts as sales.
- True cost = ingredient cost ÷ (1 − wastage %). If you waste 5%, you must buy about 5.3% more to sell one portion.
- GP % = (net sales − true cost) ÷ net sales
Note the wastage step divides rather than multiplies. Adding 5% to the cost understates it: to end up with one usable portion at 5% loss you have to start with 1 ÷ 0.95, which is 5.26% more, not 5%.
A worked example
An £18.50 main, 20% VAT, £4.60 of ingredients, 5% wastage:
- Net sales = £18.50 ÷ 1.20 = £15.42
- True cost = £4.60 ÷ 0.95 = £4.84
- Cash GP = £15.42 − £4.84 = £10.57
- GP % = £10.57 ÷ £15.42 = 68.6%
Costed the sloppy way, £4.60 against £18.50, no VAT stripped, no wastage, the same dish looks like 75.1%. That six and a half point difference is not rounding. Across a menu it is the difference between the GP you present at a board meeting and the GP that turns up in your accounts.
Common questions
Why strip VAT out before working out GP?
Because VAT was never your money. You are collecting it for HMRC. A £18.50 dish at 20% VAT is £15.42 of sales and £3.08 that belongs to someone else. Costing against £18.50 overstates gross profit by about four points, and it is the single most common error we see in menu costing.
What VAT rate applies to my food?
Broadly: eat-in is standard-rated, hot takeaway is standard-rated, and cold takeaway food is usually zero-rated. The edges are genuinely fiddly, temperature, packaging and where the customer eats all matter, and getting it wrong across thousands of transactions becomes an expensive assessment.
If a meaningful share of your sales sits near one of those edges, it is worth an hour with someone rather than a guess.
Should wastage really be in the GP calculation?
Yes, if you want the number to match your accounts. Theoretical GP from a recipe card assumes every gram sold. Actual GP includes trim, spoilage, overpours, comps and mistakes, and the gap between the two is where margin quietly disappears.
If your theoretical GP is 72% and your P&L says 66%, that six-point gap is not a mystery. It is wastage, portion control, or buying, and it is worth more than any menu price rise you are considering.
What GP should I be running?
As a rough orientation: food 65–72%, wet 70–80%, cocktails higher, wine often lower in percentage but strong in cash terms. These vary hugely by format and location, and a percentage on its own can mislead, a 60% GP on a £40 steak makes more cash than 75% on a £9 starter.
Watch both. Percentage tells you about buying and portioning; cash GP tells you whether the dish is worth its place on the menu.
Does this handle a recipe with several ingredients?
Not directly, enter the total portion cost. For full recipe costing across a menu, with yields and sub-recipes, you want a proper costing system rather than a web form. Several of our partners do exactly that, and we help operators set them up.
Rates and thresholds shown are for 2026/27, correct as at 6 April 2026 for England. They are editable above, confirm the current figures before relying on any output.
An estimate to help you think, not advice on your own business. The numbers depend on assumptions only you can confirm, talk to us before you act on them.
GP that matches your P&L, not your recipe cards
We integrate purchasing and EPOS so theoretical and actual GP sit side by side every period, and the gap between them becomes something you can act on.