Would Longer Opening Hours Pay for Themselves?

Use this worksheet before adding a late night, Sunday session or early opening. It suits shops and hospitality businesses that can measure sales by trading period. It does not set pay rates or determine when you are legally allowed to trade.

Define the extra period and its costs

Start with one proposed session, including preparation and closing time. Obtain the full incremental staffing cost for the actual roster, including applicable on-costs and any minimum engagement or penalty-rate effects, from your payroll adviser or verified payroll setup. List additional cleaning, security, utilities and waste.

Business Queensland's profit guidance recommends budgeting for the expenses needed to generate extra sales. The question here is narrower: how much extra contribution does one additional trading period produce after those expenses?

Allow for sales that merely change time

The fictional business expects product and transaction costs of 40% of sales, leaving 60% contribution before the session's operating costs. It estimates $200 of each session's sales would otherwise have happened during normal hours. Staff costs add $300, utilities $25 and cleanup $35, or $360 in total.

Assumptions: Fictional Australian-dollar management example. Revenue and costs exclude any recoverable GST; non-recoverable tax is included in costs. No GST entitlement or income-tax deduction is assumed for your business. Contribution is before unallocated overhead and income tax. The $300 staffing total is an illustrative input for this example, not an Australian pay rate or compliance calculation.

Measure	Quiet	Expected	Busy
Sales during extra session	$500	$900	$1,300
Sales shifted from normal hours	−$200	−$200	−$200
Genuinely additional sales	$300	$700	$1,100
Contribution at 60%	$180	$420	$660
Extra session operating costs	−$360	−$360	−$360
Incremental result	−$180	$60	$300

Original ASBG worked example. All businesses, amounts and scenarios are fictional. The table contains the same figures as the visual.

The expected case leaves only $60. Looking at $900 × 60% − $360 would report $180 and ignore the $120 contribution lost when $200 of sales moves from existing hours.

The session needs $360 ÷ 60% = $600 of genuinely extra sales. With $200 shifted, that means $800 through the till during the new hours. If the product mix has a lower contribution ratio, the threshold rises. Use multi-product break-even to check that mix rather than applying the whole-week average blindly.

Run a trial you can learn from

Choose a limited number of comparable sessions and record extra-period sales, full-week sales, product mix, actual staffing cost, preparation and closing time, waste and customer feedback. Note weather, holidays and promotions so an unusual week does not become the permanent forecast.

Compare nearby normal weeks and customers' stated preferences to estimate shifted sales. Neither measure, on its own, proves that the extra hours caused the change. Test a higher shifted-sales figure too: if $400 of the expected $900 merely moves from daytime, the result becomes $500 × 60% − $360 = a $60 loss.

Check whether the extra work is sustainable

Owner time still has an opportunity cost even if no extra wage leaves the bank. Record it separately and compare what it displaces. Confirm applicable trading restrictions, staffing requirements, licences and lease conditions with the relevant adviser or authority before changing hours. The example makes no legal eligibility determination.

If trial results remain weak, test a shorter session or a different offer instead of assuming more hours will fix it. The new-service trial worksheet helps assess a different use of the same time.

Where to get help

Ask your accountant to review the additional contribution and your payroll adviser to verify roster costs. Use the pricing and profit hub and hourly-rate guide to cost the work consistently.