What is Menu Engineering?
Menu engineering looks at the profitability and popularity of menu items and how these two factors can influence the increase in price charged per portion.
The Menu-Engineering Process!
This can be broken down into four steps:
1. Cost your menu Break down every item on your menu to its individual ingredients to determine exactly how
much it costs to create each of these items. It is important to cost your menu for food and not labour as the engineering process depends heavily on the profitability level of each menu item.
2. Categorize menu items according to profit and popularity levels. The process of categorizing each of your menu
items will allow you to determine how to apply your menu-engineering efforts.
3. Design your menu Part of the design process involves highlighting the items you want to sell the most, make sure
you consider your customer base: what types of customers order which items, what drives them to your establishment (a certain dish, cheap drinks, atmosphere), do your customers read your menu thoroughly, and other factors.
4. Test your menu design If you have a large chain try testing on one or two restaurants before rolling out to all, if you are a single site then try to avoid simultaneous tests between the old and new menus.
Operators in different segments apply different price points to support their market positions.
– £#.09 price points are strongly associated with value-led brands
– £#.05 with mainstream brands
– £#.00 with upmarket brands
Overall, nearly one in three food dishes in the regions apply £#.09 price points, which is 10pp higher than in London. Operators clearly sense customers outside London are more cost-conscious. £#.09 are perceived as being lower than they actually are and deemed to encourage spend and favourable price perceptions.