"Overhead" is a business term used to describe operational costs not related to direct materials and labor. Restaurant owners typically absorb these costs and pass the fees onto customers by increasing the prices charged for food. Your restaurant has some of the same overhead expenses as other businesses. But it also has costs related exclusively to the food trade. Figuring overhead lets you plan for current and future costs and analyze ways to reduce costs to make your restaurant more profitable.

How-To

1. Calculate the amount of money your restaurant spends on advertising for the year. Promotional fees include money spent for mobile/social media ads, newspaper ads, magazine ads and Web ads. Include any costs for printing fliers and discount coupons in this category.

2. Total the receipts for money paid for indirect labor costs such as custodial services, accounting services, consulting fees and warehousing charges.

3. Determine the yearly rent total or the amount spent on mortgage interest for your restaurant during the year. Add the amount paid each month for rent or interest to find this total. Do not include the principal for the mortgage loan in this category, because it falls under depreciation of the restaurant structure.

4. Total the amount of money spent during the year on repairs for your restaurant's structure, storage buildings, parking areas, vehicles or equipment used in the business.

5. Add the amount paid during the year for restaurant supplies unrelated to food or drink. Examples include cleaning supplies and dishwashing detergent.

6. Total the amount spent for your restaurant's utilities, including trash removal, recycling fees, telephone service, Internet fees, and monthly charges for water, natural gas and electricity.

7. Calculate the amount paid for annual licensing fees and any fees for your restaurant.

8. Total the amounts for Steps 1 through 7 to determine your restaurant's overhead. You can divide this figure by the number of weeks, days or even hours your restaurant operates to figure out how much business you need to do to turn a profit.