Hospitality F&B Departmental Calculator

F&B is a major revenue driver for full-service hotels — compute departmental margin.

F&B revenue

Cost of sales %

Labor cost %

Other direct %

Departmental profit

$1,305,000

Departmental margin

0.29%

Total direct costs

$3,195,000

How the math works

Departmental profit = revenue − (cost of sales + labor + other direct).

$4.5M × (1 − 30% − 35% − 6%) = $4.5M × 29% = $1.305M departmental profit, 29% margin.

How to Use

Enter F&B revenue.
Enter cost of sales %.
Enter labor cost %.
Enter other direct costs %.
Read departmental profit and flow-through.

Frequently Asked Questions

F&B department structure?

Typical full-service hotel F&B: restaurant (20-40% of F&B revenue), bar (15-25%), banquets/catering (25-45%), in-room dining (5-15%), lounge (5-15%). Catering highest margin (35-45% departmental), in-room lowest (5-15%). Mix varies by property type — luxury resort: 50% catering + 15% restaurant; urban business: 30% restaurant + 35% banquet. Demographics and programming matter.

Typical cost structure?

Food cost: 28-38% of food revenue. Beverage cost: 22-32% of beverage revenue. Blended cost of sales: 26-34%. Labor (including benefits): 30-40% of F&B revenue. Other direct (china, linens, supplies, credit card fees): 4-8%. Departmental profit margin: 20-35% of F&B revenue. Luxury resorts: 25-40%. Limited-service with F&B outlet: 15-25%.

Why is F&B hard?

F&B has highest labor intensity in hotel — 30-40% of revenue vs rooms 20-25%. Most volatile costs (food commodity prices, minimum wage increases). Operational complexity (menus, staffing, inventory). Tight margins, easy to lose money on low-volume periods. Labor minimums: restaurant needs 8-15 staff minimum regardless of guest count. Breakeven typically 40-60% of seats filled during operating hours. Below breakeven: immediate red ink.

F&B to outsource?

Many hotels now lease F&B outlets to 3rd-party restaurant operators (Aramark, Sodexo, private chef-operators). Hotel collects rent ($10-30/sqft) + percentage of revenue (3-10%). Hotel eliminates F&B risk and operational complexity. Trade-off: lower upside if F&B runs well. Common in limited-service + select-service (restaurants often outsourced). Full-service luxury: typically keeps in-house (brand standards).