Developing profitable menus: a few simple steps to optimise your menu (FREE DIY Tool)
Your menu is the most powerful tool to maximise your profitability and the most important piece of marketing for your restaurant. Optimising your menu economics and design can help you increase your average check per guest, maximise menu profitability and enhance customer experience. Here is a short guide to help you develop menus - build for functionality.
Creating your Menu
For any Horeca Business, one of the key factors to consider is what you are putting on you menu. The most common mistake we see starting Restaurateurs make, is not optimising their menu for functionality and neglecting recipe cost management. Whenever you get started, remember that proper F&B management is fundamental to managing a successful F&B business. At the end of the day, the core function of your business is to sell food and beverages - and selling a profitable menu is fundamental to it’s success.
So where do you start?
Develop effective menu strategy: it's the number one and surest way to maximise sales, margins and influence overall guest experience.
Understand and bring overview in what ingredients you use, what they cost, who your suppliers are and calculate the economics behind your menu mix.
With insight into your menu economics, you will now be able to design functional menus that maximise menu performance and enhances customer experience.
1. Understanding your food cost
To calculate the cost of each dish - you need a recipe.
You can calculate your recipe cost, based on the costs of your raw ingredients and quantity used. This will help you in determining how to properly price your products, understanding your contribution margins and make changes. Besides, having a recipe helps you to stay consistent in what you put on the table.
Note: costing out your sub recipes (i.e. syrups, sauces, etc) will help you to cost out your final dishes (main recipes).
2. Pricing your menu
With your pricing strategy in mind - you will be able to appropriately price your menu items based on strategy and insight into your recipe costs.
At this stage, you’ll be creating the overview of your menu economics:
Price - Recipe Cost = Contribution Margin
Knowing the margins of each product will help you to determine menu item placement - to create effective menus for your business.
3. Menu Design and Psychology
Leveraging the psychology of menu design is one of the surest way to help you to maximise your menu performance, direct guests in what to order and enhancing the customer experience.
From your pricing strategy, to using highlights, product placement or where you’ll display the price of your menu items - the way in which you'll design your menu will influence what your guests order.
It’s the one piece of marketing that all your guests will certainly see, and will help you to consistently maximise your menu performance and influence guest experience.
4. Your Menu Matrix
It goes without saying that F&B management is important for F&B businesses. Yet, one of the common mistakes we see, is that restaurants do not emphasise or put much effort into this. We understand, it’s time-consuming and often boring work - but getting it done will help you run a great and optimised restaurant.
To do so, you need insight into your menu economics. This ensures your menu can be designed, based on understanding and analysis. This includes having proper overview of all your:
ingredients
purchasing prices
sub recipes
main recipes
deals
& menu mix
At the end of the day - selling food and beverages is your core business, and managing your menu economics is fundamental to your long term success.
5. Creating your menu strategy
Your menu is so much more than just items and prices. It’s the single piece of marketing you surely know all your guests will see and act on.
Use the opportunity to create effective menus that enhances their experience, while promoting the items you want your guests to buy.
Leverage the psychology of menu design, and create a menu that helps you maximise your profitability.
Not sure on where to start? Shoot us a message and we’ll see if we can help you out.
you can email us at support@horecacollective.com or contact us by clicking here
