Retail Rent Percentage Calculator

Rent as a percentage of revenue is a critical metric for retail and restaurant businesses.
It tells you how much of every dollar earned goes toward your lease, and whether your location is financially viable for your business model.

Formula: Rent Percentage = Monthly Rent ÷ Monthly Revenue × 100 Monthly Revenue Needed = Monthly Rent ÷ Target Rent Percentage × 100 Maximum Affordable Rent = Monthly Revenue × Maximum Rent Percentage

What each variable means:

• Monthly Rent: total occupancy cost including base rent, CAM (common area maintenance), taxes, and insurance passed through by the landlord (also called NNN charges).
• Monthly Revenue: total gross sales for the same month.
• Target Rent Percentage: the safe upper limit for your business type.

Industry benchmarks by business type:

• Grocery store: 1–3% (thin margins, high volume)
• Restaurant (casual dining): 6–10%
• Restaurant (fast food / QSR): 8–12%
• Clothing retail: 8–12%
• Shoe retail: 6–8%
• Coffee shop: 10–15%
• Jewelry / luxury retail: 5–10%
• Hair salon / barbershop: 10–15%
• Gym / fitness studio: 10–20%

How the calculator grades your number. The assessment line uses one general retail scale, not the per-industry benchmarks above:

Read those two things together rather than separately. A coffee shop at 12% gets an “Elevated” from the calculator and is sitting comfortably inside its own 10-15% industry band. A grocery store at 12% gets the same word and is in genuine trouble, because grocery runs on 1-3%. The general scale tells you how much room the rent leaves for everything else; the industry list tells you what normal looks like in your trade.

Worked example: A boutique clothing store pays $5,500/month in rent (including NNN). Monthly revenue is $48,000.

Rent % = $5,500 ÷ $48,000 × 100 = 11.5%. The calculator calls that Elevated, while the clothing-retail benchmark of 8-12% says it is normal. Both readings are fair: the lease is affordable for a clothing store, and there is not much slack in it.

If revenue dropped to $35,000: Rent % = $5,500 ÷ $35,000 × 100 = 15.7%. Now it reads Warning on the general scale and sits well above the clothing band too. Renegotiate, or find the sales volume.

Rule of thumb: If your rent percentage exceeds the high end of your industry benchmark for more than 3 consecutive months, it is time to review your pricing, traffic strategy, or lease terms.