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SyncShelf guide · for café and coffee shop owners

Café and coffee shop profit margins in the UK: what you really keep

Most figures you'll find for café profit margins are rules of thumb. This page uses official UK data where it exists, says plainly where it doesn't, and works through one cup of coffee so you can redo the sums with your own numbers.

Latest figures

Data checked 22 October 2026. Updated monthly; next refresh after 18 November 2026 (next ONS CPI release).

What the official data says

The ONS Annual Business Survey is the only official source that breaks UK cafés' costs down. Cafés are counted inside "restaurants and mobile food service activities" (SIC 56.1, which includes unlicensed restaurants and cafés, and takeaways); coffee bars that mainly serve drinks fall under "beverage serving activities" (SIC 56.3). The 2024 results, published on 26 May 2026:

UK, 2024Restaurants and cafés (56.1)Beverage serving (56.3)
Turnover£55.6bn£26.8bn
Bought-in goods, materials and services52.2% of turnover53.0% of turnover
Employment costs33.7% of turnover32.5% of turnover
Gross value added minus employment costs13.9% of turnover13.7% of turnover
Same measure in 202218.0%18.6%

Source: ONS, Annual Business Survey, Section I (2024 results bulletin), released 26 May 2026. Percentages are our calculations from the published £m figures. Data checked 22 October 2026.

How to read it:

Figures you'll see online for café net margins (often "5 to 15%") come from accountants, consultants and suppliers. None that we found publishes how it was measured, so we don't use them as data.

One cup of coffee, line by line

An illustrative regular coffee at £3.20, the price a customer pays. Hot drinks are standard-rated for VAT (HMRC VAT Notice 709/1). The £0.60 for coffee, milk and the cup is our assumption: put in your own figure.

Per cup£Note
Price the customer pays£3.20Illustrative
VAT at 20%−£0.53Goes to HMRC if you're VAT registered
Your takings£2.67The figure margins are worked out on
Coffee, milk and cup−£0.60Our assumption
Gross profit£2.0777.5% gross margin

A 77.5% gross margin on a coffee sounds generous, and on ingredients alone it is. But every pound of gross profit still has to pay wages, rent, energy and everything else. Using the industry shares above, wages alone would take about 34p of each pound of takings, which is about 90p of that £2.67.

The price side is moving too. Meaningful Vision measured coffee prices in UK foodservice up 8.2% year on year in Q2 2026, and a regular cappuccino in Central London went from £3.30 in June 2022 to £4.20 in June 2026 (Meaningful Vision, published 25 September 2026).

What's squeezing café margins in 2026

Your margin on delivery apps

Selling the same coffee through a delivery app adds a third cut: the platform's commission, taken from the price the customer pays. On a 30% commission, the £3.20 coffee above loses another 96p before you see anything. To keep the same cash profit per cup, the app price has to rise much more than 30%. Because a hot drink carries VAT, it needs more than the 42.9% markup a zero-rated item would.

That cut buys something, though. The platforms are a way of reaching customers who would not have walked in: Deliveroo says partners "appear in front of thousands of customers on our app" and that 73% of its customers order exclusively with it each month (Deliveroo for partners, checked 23 October 2026); Uber Eats says "millions of orders are placed on Uber Eats every day" and that partners can "reach new customers with delivery and pick-up options" (Uber Eats for merchants, checked 23 October 2026). For a coffee that is a genuinely extra sale, the beans, the cup and the commission are the only costs, so what is left is margin the café did not have before. A regular who moves from the counter to the app is the same cup with a commission on top, which is why the price you set on the app matters.

The delivery pricing calculator does this for any item. For cafés on Deliveroo, a markup on your 20 best sellers also affects how Deliveroo ranks you; our Deliveroo pricing guide explains the tiers.

Five ways to protect your margin

  1. Know your cost per item. Cost each drink and food line including the cup, lid and napkin, and recheck when a supplier price changes.
  2. Work out margin after VAT. On a standard-rated item, a sixth of the price is VAT. The margin calculator does the sums.
  3. Reprice when costs move, not once a year. See active pricing.
  4. Price delivery separately, deliberately. Decide a delivery price per item with commission in view, and keep it in step with your till.
  5. Keep every channel in step. A price change that reaches your till but not your delivery menu is margin given away on every delivery order.

Frequently asked questions

What is a good profit margin for a café in the UK?

There is no official figure for independent cafés. The closest official data is the ONS Annual Business Survey for restaurants and cafés (SIC 56.1): in 2024, employment costs were 33.7% of turnover and gross value added minus employment costs was 13.9% of turnover. That is before depreciation, interest and tax, so real net profit is lower. Figures you see quoted online for café net margins come from accountants and consultants without a published method, so treat them as rough guides.

Is coffee shop margin worked out before or after VAT?

After. Hot drinks are standard-rated for VAT, so on a £3.20 coffee £0.53 is VAT that goes to HMRC if you're VAT registered. Your margin is worked out on the £2.67 left.

How much of a café's takings goes on wages?

In 2024, employment costs were 33.7% of turnover for UK restaurants and cafés (SIC 56.1) and 32.5% for beverage-serving businesses (SIC 56.3), according to the ONS Annual Business Survey. The National Living Wage for workers aged 21 and over rose to £12.71 an hour in April 2026.

Why is my margin lower on delivery apps?

The platform takes its commission from the price the customer pays, on top of VAT and your costs. To keep the same cash profit per sale at a 30% commission, a zero-rated item needs a 42.9% higher price, and a standard-rated item like a hot drink needs more. On Deliveroo, restaurants are also ranked by how far they mark up their best sellers.

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