Delivery Margin Optimization

Delivery Margin Calculator Restaurant

Third-party apps eat 20-30% of your sales, but you can fight back. Use this calculator to find your true margin per delivery order and tweak pricing to stop the bleed.

RPS Guide • Built for operators who actually run the shift
Reading time: about 6 minutes
delivery

The short version

Most restaurants lose 5-15% on delivery after fees. Aim for at least 15% net margin per order—use the calculator to plug in your commissions (20-30%), packaging ($1-2), and food cost (25-35%) for real numbers.

Delivery isn't "extra sales"—it's a margin killer unless you price and menu it right. Get this wrong, and you're subsidizing DoorDash's profits.

The real math: delivery margin breakdown

Forget gross sales. True delivery margin = (order total - food cost - fees - packaging - labor allocation) / order total.

  • Commissions: 20-30% ($4-6 on a $20 order).
  • Packaging: $0.50-2.00 per order.
  • Food cost: 25-35% ($5-7 on $20).
  • Labor bump: $1-3 for handling/packing.

Total deductions: $10-18 on a $20 order. Left with $2-10? That's your margin—10-50%, but aim low end is a loss after overhead.

Example: $20 order - $6 food - $5 commission - $1.50 pack - $2 labor = $5.50 profit / $20 = 27.5% margin.

Factors that tank your delivery margins in 2026

Delivery apps are evolving, but costs are sticky—here's what to watch:

1. Platform fees and tiers

  • Basic: 20-25% commission.
  • Premium visibility: +5-10% effective rate.
  • Self-delivery hybrid: Lower fees but add driver costs.

2. Order size and mix

  • Small orders ($15-20): High % fees kill margin.
  • Large/group: Better, but more packaging/labor.
  • High-cost items: Proteins amplify food cost hits.

3. Hidden costs

  • Refunds/errors: 5-10% of orders eat profit.
  • Peak hour labor: Overstaffing for rush adds $2-5/order.
  • Inflation: Packaging up 10%, food up 5-8% YoY.

4. Pricing strategy

  • In-app markup: +10-20% over in-house to cover fees.
  • Free delivery thresholds: Boost volume but crush small orders.
  • Menu exclusives: High-margin items only for delivery.

Quick delivery margin audit

Pull last week's data and run it in 10 minutes:

Step 1: Gather per-order basics

  • Total sales, food cost from POS/inventory.
  • Fees from app statements.
  • Packaging/labor estimates (use our templates for tracking).

Step 2: Set benchmarks

  • Target: 15-25% net after all deductions.
  • Break-even: Under 10%? You're losing on volume.

Step 3: Calculate and optimize

  • Plug into our Delivery Margin Calculator.
  • Tweak: Raise prices 5-10%, cut low-margin items.
  • Track weekly in Menu Engineering matrix.

How to boost delivery profits without ditching apps

Margins improve when you treat delivery as its own P&L:

  • Menu optimize. Delivery-only items with 20-25% food cost (apps, salads over steaks).
  • Price tier. In-app +15%, bundles to lift average order $5-10.
  • Fee offsets. Add $1-2 "service fee" or bundle packaging.
  • Volume caps. Limit orders during peak to avoid labor bloat.

Use the Third-Party Delivery Checklist from our templates to audit your setup.

Where the RPS tools plug in

One calculator is a start. The full system keeps margins honest across channels:

  • Delivery Margin Calculator: Plug in real numbers for per-order and menu-wide insights.
  • Menu Costing Spreadsheet: Auto-adjust prices as fees or costs change.
  • Prime Cost Calculator: Factor delivery labor into your overall targets.
  • Live Menu Engine service: We automate pricing across in-house, delivery, and apps.

If you’re comparing DIY spreadsheets and live menu pricing to the big all-in-one restaurant platforms, our Us vs Them page breaks down why Restaurant Profit Systems is different.

For beginners, start with our fillable templates like the Third-Party Delivery Checklist. Ready for pro-level? Dive into the calculators in The Vault.

Simple next step for this week

Pull 10 delivery orders from last shift. Run them through the calculator. If average margin under 15%, markup 3 low performers and test.

Open Delivery Margin Calculator Get Third-Party Checklist See Live Menu Engine

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FAQs

How do I calculate delivery margin per order?

Take your order total and subtract: food cost, app commission (20-30%), packaging ($1-2), and labor allocation for packing ($1-3). Divide what's left by the order total. Example: $20 order - $6 food - $5 commission - $1.50 packaging - $2 labor = $5.50 profit. That's 27.5% margin.

What's a good delivery margin to target?

Aim for 15-25% net margin after all deductions. Under 10% means you're losing money on volume—every order costs you. If you're between 10-15%, you're barely breaking even after overhead. Above 20% and delivery is actually contributing to profit, not just revenue.

Why is my delivery margin so much lower than dine-in?

Commissions eat 20-30% right off the top—that's the biggest hit. Add packaging costs ($1-2/order), extra labor to handle/pack, and higher refund rates on delivery errors. A dish with 30% margin in-house might run 10-15% on delivery without price adjustments.

Should I charge more for delivery than in-store?

Yes. Most operators mark up 10-20% on third-party app menus to offset commissions. Customers expect delivery to cost more—they're already paying service and delivery fees. If you run identical pricing, you're subsidizing every order out of your dine-in profits.