Question 1

How should I allocate shared costs between brands?

Accepted Answer

A common and fair method is to allocate shared costs based on the percentage of total revenue each brand generates. For example, if a brand accounts for 40% of your total revenue, it should be allocated 40% of the shared costs like rent and labor. This calculator does that automatically.

Question 2

What are typical shared costs in a ghost kitchen?

Accepted Answer

Shared costs typically include rent for the kitchen space, shared hourly labor (e.g., dishwashers, prep cooks who work across brands), utilities (gas, electric, water), insurance, and any shared software or administrative expenses.

Question 3

What is a good net profit margin for a virtual restaurant brand?

Accepted Answer

Net profit margins for virtual brands can vary widely, but a healthy target after all costs (including delivery commissions and shared costs) is often in the 5-15% range. Margins can be tighter than traditional restaurants due to high commission fees.

Question 4

What if one of my brands is not profitable?

Accepted Answer

If a brand is consistently unprofitable, it's a drag on your overall business. Analyze why: Are its COGS too high? Are the menu prices too low? Is it not generating enough sales volume to cover its share of costs? You may need to re-concept the menu, adjust pricing, or even discontinue the brand.

Question 5

Should I include marketing costs in this calculation?

Accepted Answer

If you have marketing costs that are specific to one brand, you should ideally add them to that brand's COGS for a more accurate picture of its profitability. If you have a general marketing budget for all brands, you can include it in the 'Other Shared Costs' section.

Brand Profitability Split Calculator

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Understanding Brand Profitability Split

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