March 12 - by Andreas Breitfuss
Restaurant Management Center
Today I wanted to talk to you about your menu and more specifically about engineering it for profit.
Menu engineering is the analysis of your menu which look at the sales price, sales history and the cost of each item of the menu. From the collected data engineering refers to the calculation of the profit or contribution margin of each item in relation to all the other items on the menu for a period of time.
Menu engineering is an integral part of hospitality management in today’s robust and competitive market. Each of the items once calculated will be classed into one of four categories:
1. Stars (popular and profitable)
2. Plow Horses (popular but not as profitable)
3. Puzzles (not popular but highly profitable)
4. Dogs (neither popular or profitable)
And it is with this information you are able to make an informed and calculated decision on what to do with the items on your menu. Engineering is not a one time calculation it is done on a regular basis like monthly or quarterly. It will allow you to maximise cost reduction in food and beverage costs and enhance your profitability of your menu. Engineering does not stop there as it allows you to position items on your menu to gain the maximum exposure to your customers to gain maximum profit. Engineering allows you to focus on the profit or contribution of each item rather that the usual practice of the individual cost percentage.
Some of the benefits of menu engineering include:
1. Increased average gross profit per customer
2. I tem analysis for decision making on what item to keep or get rid of
3. Cost control analysis to decrease your F & B costs
4. Sales promotion analysis allows you to promote higher profit items
5. Staff sales analysis and linked incentive programs
6. Menu pricing analysis
7. New menu evaluation
8. Menu layout analysis for increased profitability
9. Trend analysis for food styles on your menu
Remember dollars pays the bills not percentages.
Source: Restaurant Menu Design