At the end of 2022, many restaurant experts projected a renewed emphasis on menu engineering. Why? While a process that’s been around for over 40 years, designing and optimizing menus to maximize profitability seemed even more important when faced with growing inflation, labor shortages, and supply chain issues.
Have you taken stock of your menu lately? For those with seasonal menus or regular specials, changing their menu occurs like clockwork. But changing your menu doesn’t necessarily coincide with menu engineering. Menu engineering is, at its most basic, the study of popular and profitable menu items. And according to Food and Drink Resources, it can increase profit margins by as much as 8-12%.
At its core, menu engineering is menu psychology. Good marketing, after all, always considers the human mind and emotions. How many of you remember Nike’s ‘Just Do It’ slogan? It resonates with the human desire to be proactive and make the changes that allow us to be better.
Does your menu and restaurant have a slogan, a voice, an emotion that drives it? Is it reflected in your menu? And do you understand how your customers’ minds work, including their visual tendencies? All this, and more, is involved in menu engineering.
It involves adjusting your menu to ensure guests don’t scan over the items that offer the highest profits. It’s not about directing them to something they wouldn’t normally consider or subliminal manipulation. It ensures an enhanced experience by highlighting the dishes you know are the crème de la crème.
The Incredible World of Menu Engineering
First off, there are entire books on menu engineering. We can’t quite do the topic justice here, but we can share some tips and tricks that can make a significant difference in your bottom line. The key elements you’ll be considering are menu design, pricing, placement, and description.
The First Impression
According to the Harvard Study of Communications, it takes just seven seconds to make a first impression. For someone entering your restaurant, that’s a lot to consider! The aesthetics, the sounds, and the welcoming all congeal to create that first and all-important impression.
Then, they’re seated and handed a menu (or scan a QR code), and, in less than two minutes (109 seconds to be exact), they scan the menu. The Golden Triangle—or how a customer scans your menu—is defined as the middle, top right, and then top left. Further studies suggest they also linger on the first and last items when looking at a vertical menu. Within this matrix is often your biggest sellers, a place where menu engineers place high-margin signature dishes.
Do you know your biggest sellers and where they’re placed on your menu? Is your signature dish highlighted? You can also emphasize menu items with decorative frames or shaded boxes, otherwise known as ‘eye magnets’ in the industry.
Make sure to keep it to one or two items, retaining a menu that’s easily read with a simple and aesthetically pleasing design. Consider ending prices in a single digit for an elegant and tasteful design.
Pricing for Placement
Pricing involves calculating your per-plate and per-item raw food cost. Determine your ideal food cost percentage, which is usually between 28-32%. Your menu pricing is as follows: Raw Food Cost ($7) / Ideal Food Cost Percentage (30%) = Menu Price $23.33 rounded up to $24.
Keep in mind that different menu items usually have different profit margins. For instance, beverages are often higher, and meats are generally lower. As you can see, it can get very confusing rather quickly.
One way to verify you’re in the ballpark is to compare your menu to the competition.
Comparing Your Menu to the Competition
F&B Insights Menu Pricing helps you keep tabs on your competitors. It’s the world’s largest menu database, giving you your competitors’ and the market pricing information required to make informed decisions. It even alerts you when the restaurant down the street makes a change.
Chris Bisaillon, CEO of Bottleneck Management, a restaurant group that includes City Works, Pour House, South Branch, and Sweetwater, said, “Menu Pricing has been a great resource, to identify where we can consider raising prices. Allowing us to see thousands of menus immediately, we can make very informed pricing decisions. The previous menu pricing process was painfully slow and very manual.” Anyone who’s spent any time in the restaurant industry can undoubtedly relate!
Your menu descriptions are your salespeople. They whisper the delectable items into your guests’ ears with beautiful, descriptive words highlighting the origins, cooking methods, and unique ingredients.
Let F&B Insights Help You
Is your menu everything it could be? Checking competitors’ menus is one way to tell how you rank in this all-important aspect of restaurant operations. To learn more about F&B Insights or take advantage of the free 15-day trial, sign up today.