Most restaurant operators know their delivery commission rate. Far fewer know their actual profit per delivery order. The commission is just one of seven or eight cost components that determine whether a delivery order generates money or loses it. Without calculating the true per-order profit, restaurants cannot make informed decisions about delivery menu pricing, minimum order values, platform selection, or whether delivery is worth doing at all.
This guide provides a practical, step-by-step method for calculating the actual profit on each delivery order your restaurant fulfills. We break down every cost component, show you how to build a per-order P&L, and explain how to use the calculation to set profitable minimum order values and delivery menu prices. For background on the commission structures that drive the largest cost component, see our guide on hidden delivery fees restaurants miss.
The Per-Order Profit Formula
Delivery profit per order is calculated by subtracting all cost components from the order revenue:
Profit Per Order = Order Revenue – Commission – Processing Fee – Food Cost – Packaging – Labor Allocation – Refund Reserve – Marketing Allocation
Each component has its own calculation method — some are percentages of order revenue, others are fixed costs per order. Understanding and accurately measuring each one is the key to getting an honest profitability picture.
Per-Order Profit Calculation Worksheet
Use the following worksheet to calculate profit on a specific order value. The example column uses a $35 delivery order on DoorDash Plus (25% commission).
| Component | Formula | Example ($35 Order) | Your Restaurant |
|---|---|---|---|
| Order Revenue | Menu price of items ordered | $35.00 | $_____ |
| Commission | Revenue × commission rate | –$8.75 (25%) | –$_____ |
| Processing Fee | Revenue × processing rate | –$0.88 (2.5%) | –$_____ |
| Food Cost | Revenue × food cost % | –$10.50 (30%) | –$_____ |
| Packaging | Fixed cost per order | –$1.75 | –$_____ |
| Labor Allocation | Avg minutes × hourly cost ÷ 60 | –$1.50 | –$_____ |
| Refund Reserve | Revenue × historical refund rate | –$0.70 (2%) | –$_____ |
| Marketing Allocation | Monthly marketing spend ÷ orders | –$0.50 | –$_____ |
| Profit Per Order | Revenue – all costs | $10.42 | $_____ |
| Profit Margin | Profit ÷ Revenue | 29.8% | _____% |
Key takeaway: The commission rate alone does not determine profitability. A $35 order at 25% commission appears to yield $26.25 in revenue, but after all seven cost components are deducted, the actual profit is $10.42 — a 29.8% margin. Add food cost above 30% or packaging above $2, and that margin compresses further. Every cost component matters.
Understanding Each Cost Component
1. Commission
The platform’s base fee, calculated as a percentage of the order subtotal. Ranges from 15% (self-delivery or basic plans) to 30% (premium plans). This is typically the largest single deduction. Note that the contracted rate may differ from the effective rate once all platform fees are included.
2. Payment Processing Fee
The credit card processing charge, typically 2.5–3% of the order total. Some platforms bundle this into the commission, others charge it separately. Check your payout statements to determine whether processing is separate or included.
3. Food Cost (COGS)
The ingredient cost of the food prepared for the order. Calculate this as a percentage of your menu price, not the revenue after commission. If your food cost is 30% and the order is $35, the food cost is $10.50 regardless of how much commission the platform takes.
4. Packaging
Delivery-specific containers, bags, utensils, napkins, stickers, and tamper-evident seals. This is a fixed cost that does not scale linearly with order value — a $20 order and a $40 order often require similar packaging. Typical range: $0.75 for simple single-container orders to $3.50 for multi-course orders with beverages.
5. Labor Allocation
The staff time required to assemble, package, and stage a delivery order. This includes reading the order from the tablet, pulling items, checking completeness, packaging, labeling, and staging for driver pickup. Most delivery orders require 3–6 minutes of dedicated labor. At $18/hour, that’s $0.90–$1.80 per order.
6. Refund Reserve
A statistical allocation for the likelihood that a percentage of orders will result in refund deductions. At an industry average of 2–3%, a $35 order carries an embedded refund cost of $0.70–$1.05. This is not a charge on any individual order but an average cost that should be factored into per-order profitability.
7. Marketing Allocation
If you pay for sponsored listings, promotional participation, or featured placement on the platform, divide your monthly marketing spend by your monthly order count to get the per-order marketing cost. A restaurant spending $200/month on promotions across 400 orders allocates $0.50 per order to marketing.
A fast-casual restaurant receives a $35 order through DoorDash on the Plus plan (25% commission).
Order revenue: $35.00
Commission (25%): –$8.75
Processing fee (2.5%): –$0.88
Food cost (30%): –$10.50
Packaging: –$1.75
Labor allocation (5 min × $18/hr): –$1.50
Refund reserve (2%): –$0.70
Marketing allocation: –$0.50
Profit per order: $35.00 – $24.58 = $10.42
Profit margin: 29.8%
This order is profitable. The 30% food cost combined with a $35 order value leaves enough margin to absorb the 25% commission and all additional costs. The restaurant earns $10.42 on this order.
Estimate how much delivery fee discrepancies may be reducing your per-order profit across platforms.
Estimate Your Revenue LossFinding Your Break-Even Order Value
The break-even order value is the minimum order size at which you generate zero profit — all revenue exactly covers all costs. Orders above this value are profitable; orders below it lose money.
To calculate break-even, separate your costs into variable costs (percentages of order revenue) and fixed costs per order (flat amounts regardless of order size):
- Variable costs: Commission (25%) + Processing (2.5%) + Food cost (30%) + Refund reserve (2%) = 59.5% of revenue
- Fixed costs per order: Packaging ($1.75) + Labor ($1.50) + Marketing ($0.50) = $3.75
Break-even = Fixed costs per order ÷ (1 – Variable cost percentage)
Break-even = $3.75 ÷ (1 – 0.595) = $3.75 ÷ 0.405 = $9.26
Using the same cost structure (30% food cost, 2.5% processing, 2% refund reserve, $3.75 fixed costs per order):
At 15% commission: Variable costs = 49.5%. Break-even = $3.75 ÷ 0.505 = $7.43
At 20% commission: Variable costs = 54.5%. Break-even = $3.75 ÷ 0.455 = $8.24
At 25% commission: Variable costs = 59.5%. Break-even = $3.75 ÷ 0.405 = $9.26
At 30% commission: Variable costs = 64.5%. Break-even = $3.75 ÷ 0.355 = $10.56
At 25% commission, any order above $9.26 generates profit. Set your minimum order value above this threshold — typically $12–$15 to ensure a meaningful contribution per order, not just break-even.
Using the Calculation for Delivery Menu Pricing
Once you know your per-order profit at current menu prices, you can determine whether and how much to adjust delivery pricing. Most platforms allow restaurants to set different prices for delivery and dine-in menus.
The pricing decision framework:
- Calculate current per-order profit at your existing menu prices using the worksheet above.
- Determine your target margin. A reasonable delivery target is 15–25% net margin per order, depending on your overall business model.
- Calculate the price increase needed. If your current margin is 10% and your target is 20%, divide the margin gap by (1 – variable cost percentage) to find the required revenue increase per order.
- Apply the increase strategically. Rather than a flat percentage increase across all items, consider increasing prices more on items with higher food costs and less on items with lower food costs. This keeps popular, high-margin items competitive while improving profitability on items that currently lose money.
For a comprehensive look at all the fees that affect your pricing calculations, see our guide on how to audit delivery platform fees.
Platform-Specific Fee Variations
The per-order profit calculation changes based on which platform fulfills the order. Key differences to account for:
- DoorDash: Commission varies by plan (15–30%). Processing fee is separate (~2.5%). Marketing fees apply for DashPass promotions and sponsored listings.
- Uber Eats: Commission varies by delivery model (15% self-delivery, 25–30% Uber delivery). Processing may be bundled or separate. Uber One promotional costs may be shared.
- Grubhub: Commission ranges from 15–30% plus a processing fee. Marketing fees for promoted placement are additional. Grubhub+ subscriber orders may carry different economics.
Calculate per-order profit separately for each platform you operate on. You may find that the same menu item is profitable on one platform (lower commission) and unprofitable on another (higher commission + marketing fees). This information can guide decisions about platform prioritization and menu customization per platform.
A restaurant processes 500 delivery orders per month at an average order value of $35 across all platforms.
Monthly delivery revenue: 500 × $35 = $17,500
Total commission (blended 24%): –$4,200
Processing fees (2.5%): –$437.50
Food cost (30%): –$5,250
Packaging (500 × $1.75): –$875
Labor allocation (500 × $1.50): –$750
Refund reserve (2%): –$350
Marketing spend: –$250
Monthly delivery profit: $17,500 – $12,112.50 = $5,387.50
Monthly delivery margin: 30.8%
Profit per order: $5,387.50 ÷ 500 = $10.78
At 500 orders per month, delivery generates $5,387.50 in profit — a meaningful contribution to the business. However, if 1–3% of this revenue is lost to commission overcharges, duplicate refund deductions, or incorrect fees, the restaurant is losing $175–$525 per month in recoverable revenue.
Setting Minimum Order Values
Armed with your break-even calculation, you can set data-driven minimum order values. The minimum should be set above the break-even order value with enough buffer to ensure each delivery order contributes meaningfully to profit:
- Break-even order value: The floor below which every order loses money.
- Minimum viable order: Break-even + 30–50% buffer. This ensures each order contributes at least $1.50–$3 in profit.
- Optimal minimum: The order value at which per-order profit reaches your target margin. For most restaurants, this is $15–$25.
Setting the minimum too high reduces order volume. Setting it too low means accepting unprofitable orders. The sweet spot balances volume with per-order contribution, and the calculation above gives you the data to find it.
See how commission discrepancies, refund errors, and hidden fees may be reducing your delivery profit beyond what your calculations show.
Check Your Delivery RevenueCommon Calculation Mistakes
Several errors frequently distort per-order profit calculations:
- Using revenue after commission as the base for food cost. Food cost should be calculated on the menu price (gross revenue), not the revenue received after commission. Your food cost percentage does not change because a platform takes a commission.
- Ignoring packaging costs. At $1.50–$3.50 per order across 400+ monthly orders, packaging represents $600–$1,400/month. It is a real cost that directly reduces per-order profit.
- Excluding refund reserve. Refund deductions are statistically predictable. Excluding them from per-order calculations overstates profit by the refund rate percentage.
- Using contracted commission instead of effective commission. The effective rate (total deductions ÷ gross revenue) is almost always higher than the contracted rate due to layered fees. Use the effective rate for accurate calculations.
- Forgetting labor allocation. Even if you use existing staff, delivery orders consume labor minutes that have a cost. Five minutes of an $18/hour employee’s time is $1.50 per order — small individually, but $750/month across 500 orders.
Frequently Asked Questions
Subtract all cost components from order revenue: Profit = Revenue – Commission – Processing Fee – Food Cost – Packaging – Labor Allocation – Refund Reserve – Marketing Allocation. A $35 order at 25% commission with 30% food cost typically yields $2–$5 in profit after all costs.
Include payment processing (2.5–3%), food cost, delivery-specific packaging ($1–$3.50), labor allocation for assembly and staging, a 2–3% refund reserve, and any platform marketing or promotional fees. These add 35–50% in costs on top of the commission.
A healthy profit ranges from $3–$6 for orders in the $30–$45 range. Below $2 per order indicates marginal viability. Below $0 means the restaurant is losing money on each delivery. Target 15–25% net margin per delivery order.
Calculate your break-even order value by dividing fixed per-order costs by your variable margin rate. Then add a 30–50% buffer. For most restaurants, the profitable minimum falls between $15–$25 depending on food cost and commission rate.
Yes. Charging 10–20% more for delivery is standard industry practice. A 15% markup on a $30 order generates $4.50 in additional revenue, often making the difference between a profitable and unprofitable delivery order.