Restaurants, cafes, hotels, catering, and food service businesses in South Africa.
Use the Markup CalculatorThe South African restaurant and hospitality industry is one of the largest employers in the country, contributing significantly to GDP. Businesses in this sector face unique financial challenges including high staff turnover, seasonal demand fluctuations, and complex VAT rules on food items. Understanding the difference between zero-rated basic foods and standard-rated prepared meals is critical for accurate VAT calculations.
Our free markup calculator is tailored specifically for restaurants & hospitality businesses operating in South Africa. Below you'll find industry-specific tips, benchmarks, and common mistakes to help you get accurate results and make better financial decisions.
Industry-specific guidance to help you get accurate results
Average food cost in SA restaurants is 28-35% of selling price
Beverage markup is typically 200-400%
Target a food cost percentage of 30% or less for profitability
Financial and tax mistakes frequently made by restaurants & hospitality businesses in South Africa
Applying the wrong VAT rate to basic food items sold unprocessed vs prepared meals
Failing to register for VAT when annual turnover exceeds R1 million from catering services
Not claiming input VAT on equipment purchases, renovations, and supply costs
Miscalculating staff costs by excluding UIF contributions and SDL levies
Underestimating food waste impact on gross margin — typically 5-10% of food cost
How does your restaurants & hospitality business compare?
Typical range for restaurants & hospitality
Typical range for restaurants & hospitality
General rule for this industry
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Common questions about markup calculator for restaurants & hospitality in South Africa
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