Forecasting Revenue, Budgeting, and Profitability

Good numbers help you plan and spot problems early. This guide covers revenue forecasting, budgeting, and profitability—not legal structure or taxes (see Legal Structure & Tax Planning). Use our Profit Calculator, ROI Calculator, and Financial Tracking Template alongside this guide.

Revenue Forecasting

Start from units (meals, events, or both) and average ticket or event value. For a food truck: estimate meals per day × days open per month × average ticket. For catering: estimate events per month × average event value. Use past data if you have it; otherwise use conservative assumptions (e.g. 20–30 days open, 2–4 events per month). A simple formula: Revenue = Units × Price; break it down by month and adjust for seasonality (e.g. summer festivals, holiday catering). For labor and food cost inputs, see Staff Scheduling and Menu Costing.

Seasonality matters: many trucks and caterers see peaks in spring/summer and around holidays. Adjust your monthly forecast so you're not overestimating in slow months or underestimating in busy ones. Update the forecast as you get real data.

Budgeting: Fixed vs Variable Costs

Fixed costs stay roughly the same regardless of volume: commissary or kitchen rent, insurance, permits, loan or lease payments, software subscriptions. Variable costs change with sales: food, labor, fuel, supplies, packaging. List every cost you know; for variable costs, use historical percentages (e.g. food cost 28–32% of revenue, labor 25–35%) or unit costs. Set aside money for estimated taxes (25–35% of net profit) and an emergency fund (e.g. 1–2 months of fixed costs). Use our Profit Calculator and Financial Tracking Template.

Cash Flow: Deposits and Timing

Cash flow is when money comes in and goes out. For catering, deposits (often 25–50%) and final payments (e.g. 1–2 weeks before the event) mean revenue is recognized before or around the event—but big expenses (food, labor) hit close to the event date. Model cash flow by event date so you're not short when payroll or supplier bills are due. For a truck, daily or weekly sales help, but permit fees, insurance, and loan payments are due on fixed dates; keep a buffer. See Cashless Payment Options for Catering for deposit and invoicing practices.

Tracking Profitability: What to Report Monthly

Review gross margin (revenue minus COGS) and operating margin (after labor and other ops). Compare to your targets and prior periods. Use the same categories every month so trends are clear. Key metrics: revenue vs budget, food cost %, labor cost %, and net profit. If you're off target, dig into the biggest line items (e.g. food waste, overtime) and correct course. Use our Profit Calculator and ROI Calculator to model scenarios.

Step-by-Step: Your First Annual Budget

1. List all fixed costs: commissary/kitchen rent, insurance, permits, loan or lease payments, subscriptions.
2. List variable costs: food, labor, fuel, supplies, packaging. Use historical % of revenue or unit costs.
3. Set revenue targets by month (or by event) using your forecast; adjust for seasonality.
4. Add a buffer for taxes (25–35% of net profit) and an emergency fund (e.g. 1–2 months of fixed costs).
5. Enter the numbers into a spreadsheet or our Financial Tracking Template; review and update monthly.

Checklist: Monthly Review