For restaurant owners, even small missteps can eat into already razor-thin margins. That’s why successful operators aren’t just looking at reports at the end of the month.
They review key performance indicators (KPIs) weekly so they can make adjustments in real time and keep the business on track.
And they’re not alone. According to the 2025 State of the Restaurant Industry Report, 69% of operators say back-of-house technology made their restaurants more efficient and productive.
So, what exactly should you be watching weekly? Let’s break down the KPIs that deserve a standing spot on your schedule.
Prime cost, the combined total of cost of goods sold (COGS) and labor, is one of the most important numbers. It makes up the majority of your controllable expenses, and small changes can have a huge impact.
Prime cost includes the products and the people that keep your restaurant in business. You can calculate your prime cost using the following prime cost formula: Total Cost of Goods Sold + Total Labor Costs = Prime Cost
In addition, many restaurant operators contextualize their prime cost by comparing prime cost to total sales for a specific period, calculating prime cost percentage using this formula: Prime Cost / Total Sales = Prime Cost as a Percentage of Sales
Prime cost percentages vary depending on the restaurant model. Quick service concepts typically spend less on food and labor than full-service or fine dining restaurants, which often see higher labor costs from day to day. Factors like menu mix, pricing, hours of operation, and service style all influence these expenses, shifting your ideal prime cost target slightly. In general, a healthy benchmark is around 60% of total food and beverage sales. Full-service restaurants usually fall between 60-65%, while quick-service spots tend to land closer to 55-60%.
Sales alone don’t tell the whole story. That’s where sales per labor hour (SPLH) comes in. It shows how efficiently your staff is turning labor into revenue.
SPLH measures how efficiently your team drives revenue during their shifts. It’s a key metric for labor productivity, helping you identify your most efficient service periods and those that may need adjustment. You can also apply this concept to guests served per labor hour for a different view of efficiency.
Using your POS data, you can compare labor hours to sales or guest counts. Low SPLH may point to overstaffing, while unusually high SPLH could signal understaffed shifts, potentially leading to service issues or staff burnout. Knowing your ideal SPLH or guest-per-hour targets by daypart helps you get the most out of every labor dollar.
Food is perishable, and so is your cash if it’s tied up in inventory that’s not moving. Tracking your inventory turnover rate weekly can help you avoid over-ordering, reduce spoilage, and keep storage space manageable. It also gives you a clearer picture of which ingredients are selling and which ones are dragging down your profitability. The faster you turn inventory, the more efficiently you’re converting product into revenue.
A consistently low turnover rate may indicate that you’re carrying too much inventory or relying on items that don’t sell quickly, tying up cash and increasing the risk of waste. On the flip side, a turnover rate that’s too high can leave you short on key ingredients during peak times, leading to missed sales and frustrated guests. Striking the right balance ensures you have what you need when you need it without overextending your budget or storage space.
Restaurants across America generate more than 11 million tons of food waste annually, costing over $25 billion. At the same time, up to 10% of food purchased by restaurants is wasted before reaching guests. Of the food that makes it onto someone’s plate, nearly 20% goes uneaten, while 55% of edible leftovers are abandoned at the table.
Cutting food waste isn’t just good for the environment; it’s good for business. Sustainable practices paired with the right technology can help restaurants reduce waste, lower costs, and boost profitability all at once. In fact, Restaurant365’s food-saving features helped restaurants eliminate an estimated $318 million in waste in 2023, which added up to about 1.2% of total food sales.
With tools like waste tracking screens and actual vs. theoretical reporting, operators can pinpoint where waste happens, whether it’s excess ingredients or unsold dishes, and take action fast. Logging waste in a manager’s log is a good start, but advanced reporting gives a fuller picture and helps fine-tune operations. The result? Smarter purchasing, tighter inventory control, and a reputation that resonates with sustainability-minded guests.
Labor is one of your biggest expenses, and one of the easiest to let spiral. Weekly labor cost reviews help you stay on budget and identify scheduling gaps before overtime becomes a problem.
Calculating your labor cost as a percentage of sales helps you understand how well your staffing aligns with customer demand. Use this simple formula: Total Labor Cost ÷ Total Sales = Labor Cost Percentage
Be sure to include your fully burdened labor costs (wages, payroll taxes, and benefits for the given period_ and divide by your total sales (before taxes and discounts), typically pulled from your POS system.
So, what’s a good target? Labor cost benchmarks vary depending on your restaurant type and service model. Quick service restaurants often aim for the lower end, while full-service and fine dining restaurants trend higher. In general, most operators try to stay within the 25-35% range.
Industry averages offer helpful context, but your own labor cost percentage is the most important benchmark. Focus on improving it over time without sacrificing service quality. If you’re currently at 27%, set a goal to bring it down a few points over the next year while maintaining a great guest experience.
Here’s the bottom line: restaurants that track and respond to weekly KPIs don’t just avoid problems; they prevent them. With tighter margins and constant shifts in demand, waiting for monthly reports can leave you reacting too late. Weekly data gives you the insight to act quickly and protect your profitability.
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