Menu Engineering Explained

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What is menu engineering and how could it help your hospitality business?

It has never been more important for hospitality businesses to have full visibility over their operations. As costs rise, businesses need to stay on top of what’s working and what isn’t; what is generating profit and what is creating unnecessary losses.

That’s where menu engineering technology comes in.

Your menu is your most powerful marketing tool; the one thing that every customer will willingly pick up and read. It influences how your customers choose; how much they will spend and how they perceive your company’s brand.

Menu engineering is one of the key capabilities of Kitchen CUT software, giving hospitality businesses unparalleled insight into the psychology of what their customers are selecting, and providing the opportunity to maximise sales by subtly influencing their meal choices.

Here we take a deep dive into the many benefits of menu engineering technology and discuss how its capabilities can be applied to businesses of all sizes and types.

Calculate food cost per serving

Kitchen CUT’s system breaks down the cost of each recipe by ingredient, automatically updating as items are swapped in and out. When these costs are compared with sales figures, the in-depth data can provide a valuable perspective of how financially viable each dish is, giving an ongoing insight into how they are contributing to your bottom-line.

Understand your best and worst performing dishes

By identifying the different types of profit- or loss-making dishes through in-depth data analysis, chefs can strategically position dishes across their menus to drive targeted purchases and maximise profits.

In industry terms, the different types of dishes can be categorised as:

Stars: Stars are extremely popular dishes and contribute significantly to food profits. Ideally Stars should be the dishes you are most proud of, including your chef’s signature.

Plow Horse: Plow Horses are high in popularity but low in contribution to the bottom line. Plow horse menu items sell well, but don’t significantly increase revenue.

Puzzles: Puzzles are generally low in popularity and high in financial contribution. Puzzle dishes are difficult to sell but create high profits.

Dogs: Dogs are low in popularity and low in profit contribution. They are difficult to sell and yield little profit when sold. Menu engineering can help businesses to accurately identify and remove these dishes.

Reduce your food waste

Not only will menu engineering technology enable your business to identify dishes that don’t perform, but it will also help to drastically cut food waste, allowing your chefs to focus their efforts on dishes that sell and generate the most income.

By removing ‘dogs’ from menus, kitchen staff can adjust orders to save money and reduce food waste on items that aren’t selling.

Apply psychology techniques

Alongside these insights from menu engineering technology, hospitality professionals can maximise results by applying psychology techniques to their menus.

Think carefully about where each dish is positioned on the menu, based on its earning potential. The menu ‘sweet spot’ – the top-right corner or the centre, is where most customers start when looking at a menu, making it the ‘prime real estate’ for signature or high-earning dishes.

Other psychology techniques include:

• Avoid decision fatigue by keeping choices easy and clear with an uncluttered menu.
• Box high-earning and signature dishes to draw more attention to them.
• Focus on quality over quantity. By limiting the categories on your menu, your chefs can focus on curating an excellent selection of high-quality dishes that keep customers coming back, time and time again. By using fewer ingredients, hospitality businesses can ease pressure on their chefs, avoid over-ordering, reduce food waste and cut costs.
• Use descriptive language and create an emotional connection to your dishes, e.g. add details about trusted local suppliers or background stories about your chef’s creation of the dishes.
• Apply smart pricing psychology. As more customers are watching their wallets, make dishes more desirable with smart pricing. For example, try removing the currency sign to reduce the focus on cost or try ‘charm pricing’ – we all know £14.95 feels cheaper than £15.

Menu engineering is the most accurate way for hospitality businesses to truly understand how their menu performs and maximise profitability. With data-led insights, businesses can enhance their menus to better cater to evolving trends, tastes and spending habits, creating more customer-led offerings to entice, excite and ultimately increase footfall. Try a demo today.