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%

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% — within the 8–12% benchmark for clothing.

If revenue dropped to $35,000: Rent % = $5,500 ÷ $35,000 × 100 = 15.7% — dangerously high; renegotiate or increase 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.