Labor Cost Benchmarks: What Percentage Should You Target?

Labor is the biggest controllable expense in your restaurant. Unlike rent (fixed) or food cost (semi-variable), labor is something you can adjust shift by shift, day by day. But to manage it, you need to know what "good" looks like.

General benchmarks

Total labor cost (including wages, taxes, and benefits) as a percentage of total sales:

• Quick service / fast casual: 25-30%
• Casual dining: 28-33%
• Fine dining: 33-40%
• Counter service / takeout heavy: 20-28%

These are guidelines, not rules. Your specific number depends on your menu prices, concept, and market. But if you're consistently outside these ranges, something needs attention.

FOH vs. BOH

Front-of-house labor (servers, hosts, bussers) and back-of-house labor (cooks, prep, dishwashers) should be tracked separately. A healthy split for casual dining is roughly 40% FOH / 60% BOH. If your FOH labor is running high, you might be overscheduling servers. If BOH is high, look at prep efficiency and kitchen staffing during slow periods.

The shift-level view matters most

Your daily labor percentage might look fine, but that can mask a lunch shift at 22% (great) and a dinner shift at 38% (too high). Check labor cost by shift to find the real problems.

When to cut vs. when to hold

Cutting labor too aggressively hurts service quality, which hurts sales, which makes your labor percentage worse. The goal isn't minimum staffing — it's right staffing. One extra person during a rush pays for themselves in faster turns and better tips. One extra person during a dead shift is pure waste.

Let the data decide

Expo monitors your labor cost in real time against your sales volume. When the ratio tips too high, you get a text: "Labor is at 36% and sales are trending below normal. Consider cutting your newest server." No spreadsheets, no calculators. Just actionable advice when you need it.