Menu engineering - what it is all about ?
Date of addition: Nov. 18, 2020, 1:21 p.m.Let's get specific: the menu is not just an accessory for the interior of a gastronomic establishment. It is not just a traditional way of presenting the dishes on offer. The menu is in fact an extremely important sales tool, and its proper preparation or construction has a direct and crucial impact on the profitability of the restaurant. On this small piece of paper, in the context of the whole business, there is all the knowledge about the industry, the consumers, the potential and the chance to make money. You don't nail it - you lose out. Gastronomy is a rather fickle, restless maiden, eager to give in to new trends, and it will only make friends if you understand it. And this is where the engineering menu will definitely help.
Menu card, and restaurant guests
In running a business, you must never look in the mirror, and always look out the window. What this means. That when running a catering business you MUST think, see and even feel like your guests. What determines their choices and how they feel about them? For example, you need to know that (according to research) if people are presented with too many options (e.g. menu items), they have a hard time choosing. And then he or she feels uncertain whether he or she has done the right thing... The visit to the establishment becomes uncomfortable, yet seemingly nothing bad has happened. It's just that the guest was given an overloaded card because the owner/chef most likely 'wanted to do the right thing'. So... If you trivialise the process of creating a menu card, you can either hope for a miracle, or start counting the savings you're about to have to invest in a poorly performing business. A bit of a zero-one? OK, but look around and see how many venues fail after a year of operation? How many premises fail to cope with the constraints of pandemonium? Those that persist and thrive - are probably applying menu engineering.
What is menu engineering?
The concept combines conscientious costing, thoughtful graphics and... psychology. This hybrid of competences and knowledge from different fields guarantees the planning of guest choices. Easier? If we make good use of menu engineering - consumers will order exactly what we want. This is because menu engineering is a multi-faceted way of influencing the subconscious, but ONLY if we have perfectly prepared dishes to offer - that is, imagined, discussed, meticulously calculated, tested and then closely monitored once they are on sale. Menu engineering, therefore, starts with the concept and ends... probably only when we don't want to make any more money. So - never. IMPORTANT: Menu engineering assumes that the menu will be created in such a way that satisfaction concerns both parties: the guests (ideal choice, time pleasantly spent, money well spent) and the owners (profit, minimising losses, satisfaction).
Card creation using menu engineering
Menu engineering is planning, statistics, forecasting, verification, observation, calculation. With a dash of psychology. When creating the 'ideal' menu for a new establishment, you obviously need to remember to determine the audience, the type of cuisine, think about the culinary concept and the margins. This is a topic that requires a separate analysis, so let's start from the stage when the decision-maker of the establishment knows what direction he or she is going in and to whom his or her offer is dedicated. The time comes to prepare the set or list of dishes to be on permanent offer (i.e. on the menu). Let's see what is actually to be done:
- development of a proper (effective) portfolio of dishes;
- the visual side of the card (aesthetics), and the ways to influence the audience (sales psychology);
- meeting formal requirements (allergens, grammages) and social requirements (diets e.g. vege);
- calculating the final price: analysing the cost of creating the dish (food cost) and all the costs that are incurred to make the dish (all cost).
There is so much at the beginning, but once the card is prepared, the work is not over. Now begins the process of seeing how sales are, what the guest feedback is, what the losses and profits are. Not overall, but for each dish individually. So the engineering menu 'happens' still, and there are the following things to do:
- analyse sales for a given period of time - for each item on the card (i.e. dishes and drinks);
- isolating unprofitable and profitable dishes and then determining their importance for the whole offer of the restaurant (sometimes unprofitable dishes have to be in the card for certain reasons);
- detecting the internal competition of dishes (e.g. the same food cost does not always serve sustainable sales);
- preparation of a new menu card with exclusion of unprofitable items that harm the rest;
- at the graphic design stage - subliminal management of guests' decisions.
Examples of menu engineering
As you can easily see, menu engineering is used comprehensively and long-term. It is impossible to exhaust the subject or teach all the principles of using this tool in a single article. However, we will give some examples that may prove practical in application.
- How do you do a sales analysis?
Obviously, you can use the available functions of catering software, but the truth is that a restaurant owner's (as well as a chef or manager's) best friend is Excel. It is therefore necessary to prepare a table, and in it list all the items from the menu, determine sales in pieces (for a given period), sales in percentage, cost of preparation, food cost, net selling price (different VAT rates in catering is a big difficulty in calculations), margin, total cost and, finally, revenue. Yes, the task is not easy, but it is necessary if you want to decide your own business. The other option is to passively wait for what fate brings.
- Number of menu items
- Menu card design
Main principle of menu engineering
The tool was developed in the early 1980s as a model for merchandise analysis and later adapted for the foodservice industry. At that time, all dishes on the menu were broken down according to criteria: percentage of sales (in a given category) and margin in relation to the average. And now a curiosity. The authors of the method identified four groups of dishes:
- Stars - being the foundation of a well-crafted menu: high margin and high sales;
- Hors d'oeuvres - dishes popular with guests but with low margins;
- Puzzle/question marks - these are, in turn, dishes with high enough margins but too low sales;
-Dogs - low margin and low sales. That is, to be removed from the card.
Doesn't this approach make it a little easier to implement menu engineering at a venue? Dogs need to go, Puzzles need marketing ideas to gain guest interest. The workhorses need to be re-evaluated at the recipe stage, and the stars should become the establishment's calling card.