Proven Ways to a Profitable Menu - Part 4 - Your Menu: Cost or Asset?

Do you think of your menu as a profit-producing asset or as a controllable cost? a menu is the most powerful merchandising tool at an operator's disposal but all too often it functions simply as a decorative price list.

in reference to: http://yaseservice.blogspot.com/2010/05/proven-ways-to-profitable-menu-part-4.html (view on Google Sidewiki)

Proven Ways to a Profitable Menu - Part 4 - Your Menu: Cost or Asset?

Do you think of your menu as a profit-producing asset or as a controllable cost? A menu is the most powerful merchandising tool at an operator's didposal but all too often it functions simply as a decorative price list.

Have you ever been handed a dog-eared, stained, smelly menu in a highly-regarded restaurant? Perhaps an specially appealing item was unavailable because, as the waiter discreetly whispered, "the cost went way up and they can't afford to sell it at that price!" When things like this happen, the tail is wagging the dog - profitability has become subordinate to menu expense.

Just as a succesful coach must make frequent player adjustments to stay competitive, a savvy restauranteur must regularly evaluate the mix of sales and gross profit contribution of each item and make frequent changes to maximize profitability. It sounds easy enough but it doesn't happen because it looks like the menu will be too costly to revise. When a menu remains in service too long, like even the finest athlete, it gets tired and productivity (or profitability in this case) suffers.

Why would an otherwise brilliant operator lose hundreds of dollars by holding on to a rigid menu program that makes changes seem cost prohibitive when the dollars spent to revise the menu could probably be recovered in about a week? Because they are thinking cost rather than asset.

A well-designed menu will influence your guests' total purchases, not just the  entree, while reflecting and reinforcing the key components of your marketing mix - concept, atmosphere, service, location, image, reputation and value. How much is that worth to you?

Consider a restuarant with an annual sales of $ 500,000.00, and average check of $6.00. That means that 83,000 guests will look to your menu for guidance in making choices and recieve an impression of your restaurant (and you!) at the same time. An up to date, thoughtfully positioned menu, a a motivated server trained to sell suggestively, will help to ensure a winning recipe for increased profits.

If you begin looking at your menu as the income producing asset that it is, you will be on the right track to greater profitability.

Proven Ways to a Profitable Menu - Part 3 - The Menu as a Marketing Plan

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Whether your restaurant or foodservice facility is a chain or independent, high volume dinner house, fast food chili doggery, casual outdoor bistro or corporate cafeteria, the menu is your immidiate connection with your guests.

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Proven Ways to a Profitable Menu - Part 3- The Menu as a Marketing Plan

Whether your restaurant or foodservice facility is a chain or independent, high volume dinner house, fast food chili doggery, casual outdoor bistro or corporate cafeteria, the menu is your immediate connection with your guests.

The menu is the purest expression of your marketing plan. It is the first tangible connection your guests have between their interest in buying (why they are there-to dine, socialize or otherwise have a positive experience) and what you have to sell.

So if true marketing is identifying who your customers are and attempting to meet their needs or satisfy their requirements, then the menu is the link between your food and service and the guests' expectations - it is the bridge between marketing and operations.

• The menu sets the tone for every oparation, whether quick service, mid range/casual or fine dining. It determines the need for management, staff and equipment. It affects the profit potential from energy cost to china breakage, from training protocols to comment cards, from table turns to uniform expense.
• The menu is the connective tissue that holds the entire restaurant together. Nothing happens that in some way is not directly (or indirectly) affected by the menu.
• The menu is a translation of the food offered. In a way, the menu is a form of a product brochure.
• The menu is the conerstone of profitable operations and the centerpiece of the guests' dining experience. It establishes expectations that the food will ultimately have to fulfill and which will, in turn, determine the guests' desire to return.

as an offesive weapon, the menu is, of course, only the means to the an end. Every operator's objective, one way or another, is to use the menu to achieve higher sales in one of four ways:

Increase the Average check
Encourage and stimulate selection behaviors that result in buying more from the menu per visit.

Increase frequency visit
The menu's fabulous selections attract more frequent oatronage, driving sales upward.

Increase party size
The menu stimulates guests to expand party size to share in the wonderful dining experience.

Attract new patrons
Properly merchandised, the menu is a powerful selling tool to be strategically distributed through appropriate channels to win new converts.

given these sales building strategies, the menu offers a uniquely flexible and adaptable format to creatively merchandise the food and beverage items available.

Proven Ways to a profitable Menu-Part 2- First Things First

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The menu should be the first item to be fleshed out in building a concept because it affects every aspect of the business..

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Proven Ways to a Profitable Menu - Part 2 -First Things First

The menu should be the first item to be fleshed out in building a concept because it affects every aspect of the business. No matter what the size, shape or style of the restaurant, the menu is the hub of the operation. The stronger the links are between the menu and all other aspects of the restaurant business, the more powerful, popular and profitable the concept is likely to be and the easier it will be to grow.

The menu affects everything about a restaurant from the name on the front door to the purveyors arriving at the back door. It determines the optimum location, the demographics needed to attract the customer desired.

It determined the design of the building and the decor both inside and out. The menu is the necessary guideline to design an efficient kitchen, to choose the equipment package and to decide on the kitchen staff in terms of both prior experience and training needed.

The menu dictates the style of service and determines the staffing needed to operate the business. It sets the price points, the check average, the operation's day parts and sales volume necessary for profitability.

a restaurant in the development stage should earmark a budget for detail menu and recipe development. These documents should be included in the business plan as they provide the basis to forecast the potential sales of the restaurant and serve as the primary planning guideline for designers and support personnel.

A restaurant undergoing retrofit or redefinition because of low sales volume will also find that the menu is the key to the changes needed to regain profitability. the menu will affect eerything from decor uplift to the new look on the tabletop. It drives any changes in the service, kitchen and basic operation that will determine the new marketing image of the restaurant and the action necessary to implement it.

Everythingis linked to the food and menu.....ther is no escaping it. If your heart is not in the kitchen with the food, you must find this passion in an operating partner or a well-paid employee with a performance bonus. a restaurant without a strong sense of its menu (and the kitchen support to deliver it) will find it difficult to survive the aggressive onslaught of national chains and local competition with better food.

Proven Ways to a Profitable Menu-Part 1

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"Proven Ways to a Profitable Menu - Part 1"
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Proven Ways to a Profitable Menu - Part 1

After a short break, deciding what subject to focus on that may serve or help the owners and operators better, thought to take up on menu development and engineering.

Your menu is a blueprint for profit. It determines your image, defines your concept and is the shopping list your guests use to spend their money. Often it is your best (or worst) sales-maker.

The menu does not produce the profit but, properly designed and presented, it can help increase the sales that do! When a menu is poorly designed, guests get confused and order the first thing that comes to their minds. They get about what they expected and may leave satisfied, but they will have spent a minimal amount for a dining experience that will quickly be forgotten. What's wrong with this picture?

However, when a menu is exciting and different, it can catch the guests' attention. They get wrapped up with what you are offering, have a better time and are more likely to try items they never had before. They get more than expected, leave delighted and spend more money for a dining experience that was more memorable and more likely to cause them to return.
That is how your menu can (and should) be profitable!

Good ideas won't make anybody rich-only the application of good ideas will make life better. The next few articles should make you think. Ultimately, the real power in these ideas may not be in the ideas themselves, but rather in the insights that each may trigger for you. I hope you will adapt these notions to fit your needs and take them to a new level! All the best!

Next-Part 2- Menu First