How to Read a Restaurant Profit and Loss Statement in Ireland

Running a restaurant in Ireland today takes more than great food and friendly service. It takes financial clarity. A profit and loss (P&L) statement shows exactly where your restaurant is making or losing money, and helps you take control of your business with confidence.

Whether you’re a restaurant owner in Dublin, a pub manager in Cork, or an aspiring restaurateur in Galway, understanding your income statement is one of the best ways to stay profitable and future-proof your operations.

What is a Restaurant Profit and Loss Statement?

A restaurant profit and loss statement, sometimes called an income statement, summarises your total sales and expenses over a given time period — typically monthly or quarterly. It’s the single most important report for seeing the financial health of your business in black and white.

This report helps you:

• Track revenue performance by category (food, alcohol, non-alcoholic drinks)

• Identify areas of overspending

• Monitor cost of goods sold (COGS), labour, and operating costs

• Spot trends before they become problems

In Ireland, where 70% of restaurants saw declining profitability in 2023, being proactive with your finances is more important than ever.

Step-by-Step: How to Build Your P&L Statement

1. Choose a Reporting Period

You can generate a P&L weekly, monthly, or quarterly. For most small and medium Irish restaurants, monthly is best — it gives you enough data without becoming overwhelming.

2. Record Sales

Break down revenue by category: food, alcohol, soft drinks. Your POS system (like Toast) should give you this automatically.

Pro tip: Many Irish operators also segment sales by service type — e.g. dine-in, takeaway, or delivery.

3. Calculate Cost of Goods Sold (COGS)

Your Cost of Goods Sold (COGS) is the total amount you spend on ingredients during a specific period — think of it as what it costs you to create the dishes you sell. A quick way to work it out is:

COGS = Opening Inventory + New Purchases – Closing Inventory

Getting this right is crucial. If you’re over-ordering or letting things go to waste, it’ll show up here. Want help getting a handle on it?

4. Add Labour Costs

Labour includes wages, employer PRSI, holiday pay, and staff benefits. With labour costs averaging around 15% of turnover in Ireland, this line item can make or break profitability.

5. Add Operating Costs

This includes marketing, music licensing, equipment repairs, cleaning, and tech tools.

6. Include Occupancy Costs

Rent, business rates, and insurance go here. According to the 2024 Bord Bia report, these are among the biggest fixed costs facing Irish restaurants.

7. Account for Depreciation

This reflects wear and tear on physical assets like kitchen equipment. It’s not a cash expense, but it helps you see the true cost of operations.

Understanding the Numbers

Gross Profit = Sales – COGS

This shows how much revenue you keep after paying for ingredients. Keep an eye on your gross profit margin over time to ensure your pricing keeps up with supplier costs.

According to the Toast Consumer Preferences Survey 2025, in which 200 Irish diners were surveyed about restaurant pricing and value, 85% say rising ingredient prices have clearly affected menu pricing.

Prime Cost = COGS + Labour

Your prime cost should ideally stay below 60%. If it creeps higher, check for overstaffing, wastage, or underpriced menu items.

Net Profit = Revenue – (COGS + Labour + Operating + Occupancy + Depreciation + Other Costs)

This is your bottom line. A positive number means you’re profitable. A negative one signals a need for action.

What Irish Diners Expect — and Why it Matters to Your P&L

Irish consumers are highly price-sensitive. In fact, 72.5% say rising prices have changed their dining habits in the past year, and 87% are likely to avoid restaurants they see as overpriced.

However, it’s not just about being cheap. When Irish diners were asked in the Toast Consumer Preferences Survey 2025 how they felt about restaurants increasing prices if it results in raising staff wages, 59% were supportive.

Overall, diners may be more forgiving of higher prices if restaurants:

• Support local suppliers

• Treat staff ethically

• Communicate clearly about costs and sourcing

When you're looking at your numbers, factor this in. Sometimes that slightly more expensive local supplier or that pay rise for your best server isn't just a cost — it's an investment in what customers actually value.

Final Thoughts

A profit and loss statement isn’t just a spreadsheet, it’s a decision-making tool. In a climate where consumer loyalty is hard-won and costs are unpredictable, Irish restaurants that monitor and act on P&L insights will have the best chance of thriving.