The F&B Break-Even Checklist

The capital you burn before you sell a single item. Underestimating this is the #1 way founders run out of cash in month three.

• Lease deposit + first/last month rentUS commercial leases commonly want 2–6 months upfront. Get the exact figure in writing.
• Fit-out / renovation (kitchen, seating, plumbing, electrical)Get 3 contractor quotes and add a 20% contingency — build-outs run over, not under.
• Kitchen equipment (espresso machine, ovens, fridges, POS)Price new vs. used vs. leased. An espresso setup alone can run $10–20K.
• Furniture, signage, and brandingSignage often needs a permit — check before you fabricate.
• Licenses, permits, and health inspectionsCounty timelines run 2–6 months — and rent usually starts before approval.
• Initial inventory + opening-week stockAbout two weeks of stock; your first order is always the most wasteful.
• Pre-opening payroll + trainingYou’ll pay staff 2–4 weeks before the first dollar of revenue.
• Working-capital buffer (3–6 months of fixed costs)The single biggest difference between surviving the ramp-up and not.

These bills arrive whether you sell $0 or $50K. Your break-even point is mostly decided here — before you’ve served a single customer.

• Rent + service charge / CAM feesHealthy rent is 6–15% of revenue depending on model. Above that, the room decides your fate.
• Base payroll — salaried staff + your own drawIf the plan only works when you don’t pay yourself, it doesn’t work.
• Utilities (power is brutal for kitchens — model it high)Commercial kitchens routinely run $800–2,500/month in electricity alone.
• Insurance (liability, property, workers’ comp)Workers’ comp is legally required in nearly every state once you hire.
• Software: POS, delivery tablets, accounting, schedulingThe $80 subscriptions quietly stack to $400+/month.
• Loan or equipment-financing repaymentsLenders want DSCR ≥ 1.25 — net operating income ÷ total debt payments.
• Accounting, marketing retainer, waste collectionGrease-trap and waste pickup are often forgotten line items.

These scale with revenue — the share of every sale you never keep. Three points on food cost can flip a profitable month into a loss.

• Cost of goods sold (food + beverage)Targets: bubble tea 15–25% · coffee 20–30% · restaurant 28–35%. Cost every menu item.
• Hourly / shift labor that flexes with coversModel it per day-part; a dead Tuesday shift still costs full wages.
• Card processing + delivery-platform commissionsCards take ~2.7% of almost everything; delivery platforms take 15–30% of the order.
• Packaging + disposablesHeavy for takeaway and ghost kitchens — 3–5% of revenue is common.
• Loyalty discounts, promos, and compsTrack them as a real cost line. “Free” marketing isn’t free.

Optimism lives here. Validate every number against the real space and the real location — foot traffic you counted, not foot traffic you hope for.

• Average check / ticket size — one typical order, not best-caseUS benchmarks: coffee $5–12 · fast casual $10–18 · full-service $25–60.
• Covers per day vs. physical capacitySeats × realistic turns per day-part — does the room physically fit your forecast?
• Day-part split (weekday vs. weekend, AM vs. PM)Stand outside the location and count. Two visits minimum: one weekday, one weekend.
• A realistic ramp: 3–6 months to steady stateModel month one at 40–60% of steady-state revenue — not 100%.
• Seasonality dipsCan the cash buffer survive your two slowest months back-to-back?

If you can’t answer these five from memory, you’re not ready to sign. Each one takes ten minutes with the numbers from sections 1–4.

• What monthly revenue covers all fixed + variable costs?This is your break-even revenue — the number everything else orbits.
• How many covers per day does that require?Break-even revenue ÷ average ticket ÷ 30. Compare it to real capacity.
• How many months until break-even — and is that runway funded?Most F&B takes 3–6 months to ramp. Your buffer must cover every one of them.
• What’s your contribution margin per sale?Average ticket minus variable cost per sale. It’s what actually pays the rent.
• At what point does this concept simply not work — and what’s plan B?Write down your kill criteria now, while you’re still objective.