Published January 26, 2026
Why Your Operating Hours Might Be Costing You Money (And How to Find Out)
Staying open until midnight seems like capturing every possible sale. Why leave money on the table?
Maybe. But maybe those extra hours at the margins are destroying value, not creating it. And most operators don’t have the analytics to know which.
The Edge Hour Problem
Your stated hours might be 6 AM to midnight. But what’s actually happening at the edges?
- How many transactions occur before 7 AM?
- How many transactions occur after 10 PM?
- What’s the labor cost to stay staffed during those hours?
- When does hourly contribution margin go negative?
Many restaurants are paying for empty labor hours at the margins. Not because they don’t know their early and late hours are slow—they know that. But because they’ve never actually calculated whether the revenue from those hours exceeds the cost.
The Math Behind Marginal Hours
Revenue by hour: Easy enough from POS data.
Labor cost by hour: Harder, because scheduling doesn’t usually map perfectly to hours. You need to allocate labor across the hours worked.
Contribution margin: Revenue minus direct costs. For hour-level decisions, contribution margin is the right lens.
Threshold analysis: At what point does the hour stop earning its keep?
For most restaurants, there’s a pattern: strong hours in the middle of the day, marginal hours at the edges, and value-destroying hours at the extremes.
Location-Specific Considerations
Not every location should have the same hours.
College-town locations might thrive until 2 AM.
Office-district locations might die after 6 PM.
Suburban family locations might peak early evening and collapse after 8 PM.
Highway-adjacent locations might have steady traffic at hours when other locations are dead.
Yet many brands apply uniform hours across all locations. The corporate standard says “6 AM to midnight,” so every location is open 6 AM to midnight—regardless of whether it makes sense for their specific trade area.
This is money left on the table. Some locations should stay open later. Some should close earlier. Some should open later. The right answer is location-specific.
The Day-of-Week Dimension
Sunday hours might be very different from Saturday hours. Tuesday mornings might be different from Friday mornings.
Maybe 10 PM makes sense on Friday and Saturday, but 9 PM is the right cutoff Tuesday through Thursday. Maybe 6 AM opening makes sense on weekdays (commuters), but 8 AM is fine on weekends.
This level of granularity requires more operational complexity—different schedules for different days—but it might be the right answer.
The Seasonal Layer
Some edge hours make sense only during certain seasons:
- Extended summer hours when daylight lasts longer
- Earlier closing in winter
- Holiday-adjusted hours
- Local event adjustments (college football Saturdays, festival weekends)
Static year-round hours are simple to manage but might not be optimal. The question is whether the optimization is worth the operational complexity.
The Strategic Considerations
Not every unprofitable hour is a cut candidate:
- Are these hours building habits that pay off later? Early morning regulars might become lunch regulars.
- Is late-night presence strategically important for brand positioning?
- Are there safety or staffing reasons to maintain certain hours?
- What’s the second-order impact on employee scheduling?
The analysis tells you which hours are underwater. The strategy tells you whether to do anything about it.
What Generic AI Gets Wrong
An AI without operational context will tell you your 11 PM hour is unprofitable. That’s just math.
What it won’t do:
- Assess whether that hour is strategically important
- Recommend which specific locations should adjust hours
- Model the second-order effects of hours changes
- Balance optimization against operational complexity
- Recognize that a small sample of late-night customers might grow with better promotion
The calculation is the easy part. The strategic judgment requires understanding how restaurants actually work.
What We Built
Quantiiv calculates hourly contribution margin by location and flags hours where you’re paying to stay open. But it presents this alongside the strategic context you need to decide what to do about it—because not every negative-margin hour is a cut candidate.
When was the last time you ran an hours optimization analysis? What surprised you?