How does your restaurant compare to the rest of Australia?

Any Australian business that sells food and drink, generally for consumption on the premises, is categorised as being part of the restaurant industry.

Performance benchmarks have been set by the Australian Taxation Office (ATO) based on information reported by restaurants’ tax returns and activity statements for the 2015-16 financial year. The ATO updates this information each year. In December 2018, this is the most current data.

These benchmarks show ranges of business income to business expenses. You can use this information to compare your performance against similar businesses in your industry.

What are the key benchmarks?

  • Cost of sales to turnover is the key benchmark range for the restaurant industry. It is likely to be the most accurate when predicting business turnover.
  • If you don’t report cost of sales, or only report a small amount, use the Total expenses to turnover as your key benchmark instead.

Generally, you should fall within the key benchmark range for your particular annual turnover. Falling outside the key benchmarks for your industry may indicate your business has room for improvement.

It may also be worthwhile checking you reported all income and accounted for any trading stock that may have been used for private purposes, as this can affect your results.

Tax return – key benchmarks for 2015–16

Key benchmark range Annual turnover range

$65,000 – $500,000 $500,001 – $2,000,000 More than $2,000,000
Cost of sales/turnover 31% – 37% 33% – 37% 31% – 36%
Average cost of sales 34% 35% 34%
Total expenses/turnover 81% – 90% 87% – 93% 89% – 94%
Average total expenses 86% 90% 92%

Activity statement – key benchmarks for 2015–16

Key benchmark range Annual turnover range

$65,000 – $500,000 $500,001 – $2,000,000 More than $2,000,000
Non-capital purchases/

total sales

56% – 67% 53% – 62% 51% – 59%

Other benchmarks that may assist your business

Note: In reviewing these benchmarks, remember that not all expenses are reported by every business. Additionally, there are fewer businesses in the restaurant industry that report this information, so it should only be used as a guide.

Tax return – other benchmarks for 2015–16

Benchmark range Annual turnover range

$65,000 – $500,000 $500,001 – $2,000,000 More than $2,000,000
Labour/turnover 18% – 28% 23% – 31% 27% – 32%
Rent/turnover 13% – 19% 9% – 14% 6% – 10%

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Source and for more info about benchmarks in the restaurant industry: www.ato.gov.au

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