How Restaurant Menu Engineering Really Works
Restaurant menu engineering is about more than adding pictures. There are so many places in your restaurant where you can make money or save money. But there is no single place as powerful or relevant as your menu.
Want to know what most independent restaurant owners miss when creating their menus?
The reality is most independent restaurants don’t even know what each dish they put on a plate costs to serve, forget about the side dishes and sauces. What I hear a lot is, “I’ve got all the costs in my head.”
Wanna hear the truth about that?
Just because you inventory and place the order for every food item needed to produce the menu, it doesn’t mean you know what things cost. Operating like this can kill your restaurant. Because what you think the costs are and what they really are is usually very different.
For a more thorough explanation for creating recipe costing cards, watch this video.
Restaurant menu engineering
For a second now, let’s assume you’re not one of the independent restaurant owners I am talking about above. Not only do you have recipe costing cards for your main dishes, you have them for every batch recipe, soup, etc. Heck, you even complete yield tests on a routine basis making sure you’re using the right costs every step of the way. So what do you do now? You already know your cost.
As I like to preach, TAKE ACTION! Here’s what you should do:
1) Input all of your recipe costs into your POS system and then run an item-by-item sales mix report for at least a month, or better yet, three. This report will give you what your ideal or theoretical food cost should be based on what customers have purchased.
2) Once you have this report, you will want to identify changes that can be made to decrease your cost. You can look to purchase different products of like or better quality but cost less. You can reduce the portion sizes. An extra item here and another one there can have a dramatic impact on your costs. A good way to gauge what you can change is to monitor your garbage cans. You’ll see what’s being over served because it will be in the trash.
3) You can use this same report to identify changes that can be made to increase your profits. To increase your profits you should identify items that make you the most money. Then you will want to design your menu to influence your guests’ purchasing decisions by doing some menu merchandising. Menu merchandising is a restaurant owner’s best tool to increasing profits.
Make more money with your menu
Before you read further, I want to warn you that if you don’t have up-to-date and accurate recipe costing cards in place, the following strategies won’t work long term. But once you know your dogs from your stars and what each menu item is costing you to make, restaurant menu engineering continues with the following ideas.
There are a lot of tools that you can use to influence purchasing behavior. Here are just a few:
1) Place high-profit items where your customers are most likely to look first. There have been studies that show where a customer looks first and then the path they take with their eyes. These studies show eye movement for a one, two and three panel menu.
2) Don’t let your menu be a price list. A price list menu has an item name and then to the far right it lists the price all by itself. Stick that price at the end of the item description without a dollar sign and one font size smaller. Let your guest read the description and want it first, rather than shop the price they want to pay and then pick.
3) If you have categories, such as appetizers, that have 10 items in them, understand that the first, second and last items will sell the most in that category. So place your priority (i.e., most profitable) items in those spots to move them.
4) Make an item stand out with a box, highlight, star, picture, etc. These items will sell. If you are a restaurant where pictures are appropriate… if you put a photo of the item in the menu… be prepared. You will sell the heck out of it. I’m not kidding.
5) Reduce the number of items you have on your menu. Fewer menu items means less money in inventory sitting on your shelves, less waste, less labor and consistent food. Having too much on your menu can cost you a lot of money.
Take any of these actions to see results – lowered food costs, increased sales. Heck, maybe you’ll experience both!
Read more about the systems that will help you engineer your menu. Download our free special report, Breaking Away from the Insanity: How to easily take control of your restaurant and make more money. Download it here.
Or request a free 15-minute consultation with our Solutions Coach.
