How do you know how your restaurant business is actually doing?

Though there isn’t one magic calculation out there that can you tell you whether or not your business is in the red, there are a few key performance indicators (KPIs), or metrics, that you can track that will give you a better picture on your restaurant’s financial health.

Aloha POS, for example, offers robust analytics and reports that give you the information you need to know how your restaurant is doing.

So, if you want to be set up for success, consider tracking the following metrics for your restaurant….

1) Cost of Goods Sold (COGS)

COGS = Beginning Inventory $ – Ending Inventory $ / Sales

Since restaurants are built around food and drink, it shouldn’t be surprising that calculating COGS is one of the most important metrics for restaurants to track.

Pricing, menu mix, waste factor and smart purchasing are all ways to control this cost.

Contact us today to discuss the perfect inventory solution for your business to determine your perfect cost and manage product to that number.

2) Labor Cost %

Labor Cost = Labor $ / Sales

Calculating your labor cost is a vital piece of the puzzle in ensuring your business’s success. Labor cost determines the percentage of each dollar of sales that is spent to pay your team.

As one of the largest expenses in your business, it is vital to know this information at all times. Fortunately, Aloha POS provides detailed monthly, weekly, daily, and even hourly labor information to help you make informed decisions.

The ideal labor cost is 30% with combined food and labor costs not exceeding 60%.

Contact us to learn about our scheduling software and how it can help with this vital cost.

3) Gross Profit

Gross Profit = Total Sales  COGS

As COGS is the product you sell, those costs must be accounted for first. Understanding your gross profit makes it easier to budget the remainder of your controllable expenses.

Aloha offers robust reporting features. When coupled with industry-leading inventory and scheduling solutions from Midwest POS, you have the power to ensure more money flows through to your bottom line.


Calculating your COGS, labor cost percentage, and gross profit will give you a good start to analyzing your restaurant’s financial situation. Thankfully, this is really easy to do with the right tools.

There are many other KPIs and metrics that you can track as well, from comps to voids and labor costs, but the good news is that by ensuring you have the right point-of-sale, scheduling and inventory solutions in place, these metrics are at your fingertips.

Have questions about how POS systems like Aloha POS can help you with tracking metrics for your restaurant? Get in touch! We’d love to hear from you.