What is Restaurant Menu Engineering?
Menu engineering is the practice of designing menus to maximise profits while maintaining customer satisfaction. It combines psychology, cost analysis, and sales data.
Factors That Influence Restaurant Pricing
Ingredient Volatility
Wholesale food prices are highly volatile. Menu prices must be adjusted regularly to reflect real costs.
Labour Costs
Staff preparation time, from chefs to servers, must be included in dish costings.
Overheads and Waste
Restaurants incur higher rent, energy, and marketing costs, alongside waste from unsold or spoiled stock.
The Psychology of Menu Pricing
Charm pricing, anchoring, and menu design all influence customer choices. A premium steak priced at £29 can make a mid-range dish at £19 seem like better value, increasing orders of the target dish.
How to Calculate Profitability Before Printing Menus
Calculate the cost of goods sold (COGS)
Add labour costs
Apply overheads and waste percentages
Factor in VAT and payment fees
Apply margin target and round for presentation
Practical Example: Pasta Dish
Ingredients: £1.80
Labour: £1.50
Overheads: £0.60
VAT and fees: £0.70
Total cost: £4.60
To achieve a 70 percent margin, the selling price should be £15.30.
Using Menu Engineering to Drive Sales
Highlight high-margin items with boxes, images, or menu placement. Rotate seasonal dishes to keep margins strong while maintaining interest.
Use Our Restaurant Profit Margin Calculator
Our Menu Pricing & Profit Margin Calculator helps restaurants test profitability before printing menus, ensuring every dish contributes to overall success.
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