If you are planning to open a pizzeria, you may want to know how much profits you can make with this business. In other words, you must know how much revenue you must generate to reach break-even and make profits.
With a market size of about $46 billion and over 75,000 pizzerias in the US, the average pizza shop has an annual turnover of $600,000..!
What does this mean for your pizzeria? How much revenues can you expect to generate? More importantly: how much profits can you realistically make with a pizzeria?
In this article we’ll look into the average revenues and profit margins of a pizzeria in the US. We’ll also look into how you can accurately forecast your pizzeria’s turnover and break-even point. Let’s dive in!
What is the Average Profit Margin for a Pizzeria? The average profit margin for a pizzeria can vary widely based on factors such as location, business size, efficiency, and pricing strategy. However, as a general guideline, the average profit margin for a pizzeria typically falls within the range of 7% to 20%.
What is the average profit margin for a pizzeria?
According to BNG Payments, the average profit margin for pizza businesses is about 15%.
These are industry averages though, and vary a lot from one pizzeria to another. In our experience, profits can be estimated by preparing financial projections.
Indeed, profits for a pizzeria vary based on 2 factors: your revenues and expenses.
We already saw how much turnover earns the average pizzeria in the US (~$600,000), let’s now see how much it costs to run a pizza shop.
Forecasting expenses for a pizzeria
There are 2 types of expenses for a pizzeria:
- Variable expenses: these are the COGS as explained earlier. They grow in line with your revenue: if your turnover increases by 10%, variable expenses grow by 10% as well
- Fixed expenses: salaries, rent, debt interest (or leasing) costs to acquire the equipment, marketing and all the other operating costs listed above
How to Run a Profitable Pizza Restaurant
FAQ
What are the profit margins on pizza?
Is pizza highly profitable?
How much do pizzeria owners make?
|
State
|
Annual Salary
|
Hourly Wage
|
|
California
|
$68,378
|
$32.87
|
|
New Hampshire
|
$67,797
|
$32.60
|
|
Massachusetts
|
$67,504
|
$32.45
|
|
Hawaii
|
$67,123
|
$32.27
|
How much do pizza pizza owners make?
What is the average profit margin for a pizza business?
According to BNG Payments, the average profit margin for pizza businesses is about 15%. These are industry averages though, and vary a lot from one pizzeria to another. In our experience, profits can be estimated by preparing financial projections. Indeed, profits for a pizzeria vary based on 2 factors: your revenues and expenses.
How do I calculate my pizza shop’s profit margins?
Here’s a step-by-step guide on how to calculate your pizza shop’s profit margins: 1. Gather Financial Information: Start by gathering all the relevant financial data for a specific period, usually monthly or annual sales.
What is a good EBITDA margin for a pizzeria?
Whilst gross margin stands at about ~83%, EBITDA margin can go up to 15-20% depending on the business and net profit margin up to 5-10% for the most profitable pizzerias (in line with the industry averages discussed above). How to calculate break-even for a pizzeria? Break-even is the point at which total costs and total revenue are equal.
How much profit can a non-chain Pizza store make?
Most non-chain pizza stores run have a 3-7% profit margin. Whichever way you slice it, that number can be improved. There are plenty of possibilities for profit in any pizza parlor. But before we dive into the tips for increasing revenue, you need to calculate your profit margin. Just follow this simple formula: