Taco Bell is doing a monthly subscription for 1 taco a day for $10 a month.

How does Taco Bell make money off that?

Checked the average price of a taco at Taco Bell and it seems to be about $1.80.

That means Taco Bell is giving a $54 value every month for $10.

After that, let’s look at the real costs of the tacos.

Taco Bell is owned by Yum Foods, which has disclosed they run an average food/paper costs on all food sold at 31%.

That $54 a month moves to $16.74, not factoring in labor.

Now it’s a $16.74 value for $10 a month.

Next up, the average checkout at Taco Bell is $5.13 per person.

Largely due to people ordering things like a drink or two tacos, versus just one.

So to estimate what Taco Bell should make on this, it’s pretty simple.

$5.13 is the checkout
The post food costs profit margin is $3.53.
The subscription loses Taco Bell $0.55 of that.

Taco Bell still would on the average order with subscription get $2.98 on profit margin.

Also let’s say hypothetically someone went there for a free taco every single day on the subscription.

If a person just spent $10 extra a month on things like drinks, extra tacos or something else, they’d be able to pull in a profit.

The whole purpose to this subscription is Taco Bell knows very few people to subscribe will come daily and most will be upsold.

This is why Taco Bell will make a profit off a $10 a month subscription.