What Is a Restaurant P&L Statement?

A Profit & Loss (P&L) statement — sometimes called an income statement — shows your restaurant’s sales, costs, and profits over a set period.

It answers three key questions:

• How much revenue did we make?
  
  
• How much did we spend?
  
  
• How much profit is left?
  
  

A simple restaurant P&L includes:

• Revenue — food sales, drinks, delivery, catering
  
  
• Cost of Goods Sold (COGS) — ingredients, packaging, delivery costs
  
  
• Labour Costs — wages, tips, taxes, benefits
  
  
• Operating Expenses — rent, utilities, marketing, software
  
  
• Net Profit — what’s left after costs
  
  

Why Your P&L Matters

Without a clear P&L, you’re flying blind. You might be busy every night, but still losing money.

Your P&L helps you:

• Spot profit leaks: see where your money disappears
  
  
• Understand true margins: know which menu items make or lose money
  
  
• Control costs: track suppliers, labour, and overhead
  
  
• Make smarter decisions — from pricing to promotions
  
  

Average Restaurant Profit Margins in the UK

According to industry benchmarks, the average UK restaurant profit margin is between 5% and 15%:

• Fast food/takeaway: ~10–15%
  
  
• Casual dining: ~5–10%
  
  
• Fine dining: ~3–7%
  
  

If your margins are below these ranges, it’s time to dig into your P&L.

5 Ways to Improve Your Restaurant Profitability

Here are five actionable strategies to increase your margins using your P&L:

1. Engineer Your Menu

• Identify high-margin dishes and promote them.
  
  
• Remove low-performing, low-margin items.
  
  
• Use data to drive menu pricing.
  
  

2. Negotiate Better Supplier Deals

• Compare pricing across suppliers.
  
  
• Buy in bulk where possible.
  
  
• Track COGS trends to spot overcharging.
  
  

3. Optimise Labour Scheduling

• Match staff hours to peak demand.
  
  
• Use data to avoid unnecessary overtime.
  
  
• Automate rota planning where possible.
  
  

4. Reduce Food Waste

• Monitor ingredient usage vs. sales.
  
  
• Use smart portion control.
  
  
• Repurpose excess stock into specials.
  
  

5. Automate Your P&L Tracking

• Manual spreadsheets are slow and error-prone.
  
  
• Tools like Alpacap automatically collect your financial data, categorise costs, and show real-time profit and margin insights.
  
  

How Alpacap Helps Restaurants Stay Profitable

Instead of juggling spreadsheets and invoices, Alpacap:

• Connects directly to your bank and POS
  
  
• Categorises every transaction automatically
  
  
• Generates real-time P&L reports
  
  
• Alerts you when margins drop below target
  
  

It’s like having a digital CFO — without the cost.

Key Takeaways

• A P&L statement is your restaurant’s financial health check.
  
  
• Healthy UK restaurant profit margins range from 5% to 15%.
  
  
• Use your P&L to control costs, improve pricing, and grow profits.
  
  
• Automating your P&L with Alpacap saves time and improves accuracy.