Menu design and development is more than just a food list. It is an advertising tool targeting at the same time an increase in profitability.
How mathematics, psychology and engineering menu design and development are associated to each other? At first glance, are not. With a more closer look, however, all combined can help increase the profitability of your business by creating best selling menus.
But let’s start from the very beginning. What is defined by the term engineering menu?
Menu engineering design and development was born from the following question: How does the structure, content, and even style of a menu affect a restaurant’s turnover? Is it possible to structure the menu in such a way as to contribute to increasing the profits of a restaurant while aiming to optimize the use of raw materials?
The answer is a resounding YES! But in what way can such a thing be possible? Encouraging customer preferences for dishes where there is a higher profit margin and discouraging them from dishes where the profit margin is much smaller.
Menu engineering design and development is, in short, a mathematical and scientific analysis of a menu in real time. It helps to better understand details related to choosing a dish and the profit derived from it.Does that sound weird to you? Almost utopian? Let’s try to explain with simple examples the net profit margin of a restaurant.
The profit margin varies greatly depending on the geographical location, the current trend, the seasonal availability of certain ingredients, the economic situation of a region and is calculated after deducting all the profits of the business operation from the gross profit (rent, employee wages, administrative costs, taxes, maintenance).
A restaurant with total revenue of €100,000 and total costs of €70,000 has a profit margin of 30%
That is:
Net profit = €100,000 – €70,000 = €30,000
Net profit margin = 30,000 / 100,000 = 0.3 = 30%
By following the suggestions below and adopting the right practices, you can increase your restaurant’s profitability by up to 15%.
A catering business, wishing to be sustainable, competitive and above all profitable, needs to take into account the following factors:
To increase the number of its customers and the frequency of their visits.
– Achieve an increase in average consumption per customer.
– To be able to increase the average profit per plate.
The engineering menu mainly targets the last two options.
By combining the parameters related to human psychology (the messages that the mind receives, interprets and ultimately motivates in specific purchase decisions) and the mathematical analysis (cost of raw materials, number of dishes sold, profit in each individual recipe) of the menu engineering design and development can contribute to an increase in the profitability of our business.
But what about the average consumption per customer? Is price increase or cost reduction a one-way street? These choices are very risky without a properly thought-out analysis, since they can have short-term results causing problems for the restaurant, thus affecting the quality/price ratio of the dishes and reducing the clientele.
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