How Much Does a Restaurant Owner Make?

How much does a restaurant owner make?

Every restaurant has a story to tell. Behind all the bustling dining rooms, alluring aromas, and colorful dishes lies the hard work of a restaurant owner making it all happen. 

The dream of opening a restaurant is fueled by passion—but its longevity is fueled by financial success. So many prospective restaurateurs wonder, just how much does a restaurant owner make?

The short answer: it depends. Annual earnings for restaurant owners span a wide spectrum, and no two restaurant owners (or salaries) are the same. 

The long answer? With smart planning and execution, talented restaurateurs can earn a comfortable living from their culinary business. 

Average income of restaurant owners

According to Indeed, the median pay for a restaurant owner in the U.S. is $58,193 per year. However, total earnings can vary greatly based on the restaurant’s size, style, location, efficiency, and other factors.

Here are some brackets to put those earnings into perspective:

• Small, independent restaurant owners tend to earn an average of $29,000 to $60,000 annually. 
• More upscale or particularly successful establishments can bring $150,000 or more in owner income.
• Multi-unit operators and franchise owners can further boost earnings into the range of $200,000 or more.

While the numbers are promising, it’s also important to keep expectations grounded. Opening a restaurant is a commitment, requiring forethought on both the creative and logistical aspects.

Again, no two restaurant stories are the same. With so many factors involved, the question of how much a restaurant owner makes can only be answered by considering everything.

Factors influencing a restaurant owner’s salary

Location is perhaps the most influential factor of restaurant owner salary, with restaurant owners historically enjoying greater revenue in bustling urban centers or tourist locations like:

• Washington DC
• New York
• New Jersey
• California
• Florida

Size also matters. Larger restaurants with higher sales volumes generally allow owners to earn more. And operational efficiency, including effective control of food, labor, and overhead costs, is essential in maximizing net profits.

Of course, when asking “How much does a restaurant owner make?” one of the biggest deciding factors is what they choose to pay themselves.

Deciding how much to pay yourself

While certainly a key perk of ownership, determining a reasonable salary involves balancing your personal needs against the business’ growth. 

Here are some tips for deciding your pay as an owner:

• Analyze the current profitability of your restaurant to establish a sustainable salary number.
• Reinvest surplus profits back into the business to fuel growth and expansion before taking home more personal income.
• Increase owner salary benchmarks over time as the business matures and generates consistently higher profits.

Many restaurant owners also opt for compensation packages that combine a regular salary with dividends from business profits. Others may increase their salary by taking a more active share as owner-operators, putting themselves in management or cooking positions.

At the end of the day, profit is tied to a restaurant’s success—so investing in a strong foundation is key to successful ownership, and eventually, a bigger paycheck.

Calculating profit in the restaurant business

Since a restaurant’s profit is intrinsically tied to owner payouts, profit margins are a key metric to determine salary.

In essence, restaurant earnings consist of total sales revenue minus all business expenses. These typically include:

• Cost of Goods Sold (COGS)
• Labor costs
• Overhead (rent, insurance, supplies, utilities, etc.)

Savvy restaurateurs can track these expenses using accounting software and financial reports, subtracting them from sales revenue to determine profitability.

Sales Revenue – [ Cost of Goods Sold + Overhead + Labor ] = Profit

Strategies for increasing restaurant profit

Several strategies can be employed to drive more revenue to your restaurant. Owners can take a proactive share—marketing high-profit menu items and working to streamline processes that can help seat and serve more customers per hour.

Another emerging strategy to drive revenue is utilizing ghost kitchens.

Also known as dark kitchens or virtual kitchens, a ghost kitchen helps restaurants scale operations with a delivery-only model. They work by:

• Operating out of low-overhead commercial kitchen spaces with no dining room or wait staff, ghost kitchens minimize overhead and maximize profit.
• Leveraging delivery apps and focusing on takeout, ensuring a scalable business unconstrained by physical space limitations.
• Handling all the logistics on the backend, helping restaurant owners amp up customer throughput while your brand takes all the credit.

For restaurateurs seeking ways to profitably and sustainably grow their brand, a ghost kitchen presents an appealing alternative.

Maximize profit with Cloud Kitchens

So how much does a restaurant owner make? Ultimately, salary can vary substantially based on their business model, location, operational execution, and financial management. 

While median earnings fall around $50,000 to $60,000, six-figure incomes are possible for multi-unit, higher-end restaurants in the right markets—or with the right strategy. 

One such strategy that’s gaining momentum? Ghost kitchens.

Whether you’re an established restaurant looking to expand into new markets with faster ROI, or a local owner-operator aiming to reach new customers through a robust delivery model, CloudKitchens offers a turnkey solution. 

Ready to explore the opportunities? Reach out to a CloudKitchens expert today.

Explore ghost kitchen locations across the US:

• Ghost kitchens in San Francisco
• Ghost kitchens in LA
• Ghost kitchens in NYC
• Ghost Kitchens in Toronto
• Ghost Kitchens in Atlanta
• Ghost Kitchens in Dallas
• Ghost Kitchens in Chicago
• Ghost Kitchens in Denver
• Ghost Kitchens in Miami

DISCLAIMER: This information is provided for general informational purposes only and the content does not constitute an endorsement. CloudKitchens does not warrant the accuracy or completeness of any information, text, images/graphics, links, or other content contained within the blog content. We recommend that you consult with financial, legal, and business professionals for advice specific to your situation.

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Sources:

Indeed. Restaurant owner salary in United States. https://www.indeed.com/career/restaurant-owner/salaries

Franchise Business Review. How Much Do Franchise Owners Make and Is It Profitable? https://franchisebusinessreview.com/post/how-much-franchise-owners-make/

Indeed. How Much Do Restaurant Owners Make? (With Recent Data). https://www.indeed.com/career-advice/pay-salary/how-much-do-restaurant-owners-make