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Menu Analysis & Engineering . HRT383. References. Mill, Robert Christie (1998) Restaurant Management: Customers, operations, and employees / Menu Scoring & Menu Engineering, pp 114-116. Upper Saddle River, N.J. : Prentice Hall.

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references
References
  • Mill, Robert Christie (1998) Restaurant Management: Customers, operations, and employees / Menu Scoring & Menu Engineering, pp 114-116. Upper Saddle River, N.J. : Prentice Hall.
  • Drysdale, John A. & Jennifer Adams Aldrich (2002). Profitable menu planning / Chapter 5: Menu Analysis, pp. 101-115. 3rd ed. Upper Saddle River, N.J. : Prentice Hall, TX911.3.M45 D79 2002
  • CD-ROM TX911.3.M45 D79 2002

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objectives
Objectives

By the completion of this presentation you should be able to:

  • Analyze a menu for profitability
  • Apply menu engineering to menu analysis
  • Price menu items
  • Locate menu items on a menu.

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important terms
Menu engineering

Plowhorses

Puzzles

Stars

Dogs

Menu

Placement

Pricing

Important Terms

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introduction
Introduction

This presentation explains how to evaluate a menu

  • When measuring a menu to see if it is successful 2 criteria must be met to declare it a winner:
    • Must be profitable in terms of individual item profitability
    • Most profitable item must be selling the best.

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stars plowhorses puzzles dogs
Method, called menu engineering, developed by Donald Smith Ph.D., Westin Hotels Distinguished Professor at Washington State University

This method rates the menu by measuring each entrée as to its profitability (gross profit) and its sales. It then combines these measurements and places each menu item into one of four classifications.

Stars, Plowhorses, Puzzles, & Dogs

Puzzle

Plow

Horse

Star

Dog

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contributing margin
Contributing Margin
  • Determine the contributing margin (CM) of each item
    • CM same as item’s Gross Profit
    • Use total food cost (include garnish, accompaniments served with entrée such as salad, potatoes, rolls, butter etc.).

Selling Price – Food Cost = Contributing Margin

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data trap spring 08
Data Trap Spring ‘08
  • See Lunch Hand Out

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desserts
Desserts

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popularity
Popularity
  • Average Popularity

80% of the average item sales per Dessert:

100 / 4 X 80% = 20%

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desserts13
Desserts

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hrt383 lunch desserts
HRT383 Lunch Desserts

100%

Popularity

20%

0 Contribution Margin $3.44

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hrt383 lunch desserts15
HRT383 Lunch Desserts

100%

Popularity

20%

0 Contribution Margin $3.44

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desserts16
Desserts

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the four key menu categories
The Four Key Menu Categories
  • Plowhorses are items that are relatively popular but have a high contribution margin. Items in this category can have their menu prices increased or the portion size cut in a attempt to increase CM. If market is price resistant
  • Stars have both high popularity and high CM
  • Puzzles have relatively low popularity and high margins; lower price.
  • Dogs are both low in popularity and CM; eliminate

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hrt383 lunch desserts18
HRT383 Lunch Desserts

100%

Increase $

Cut Portion ?

Popularity

20%

Eliminate?

0 Contribution Margin $3.44

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data trap spring 0819
Data Trap Spring ‘08
  • See Lunch Hand Out for
      • Main Courses

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popularity21
Popularity
  • Average Popularity

80% of the average item sales per Main Dishes:

100 / 11 X 80% = 7.27%

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exercise
Exercise
  • Please work with your fellow students and come up with suggestions/decisions.

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hrt383 lunch main courses
HRT383 Lunch Main Courses

100%

Popularity

7.27%

0 Contribution Margin $6.88

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group work

Group Work

Please on Menu Categories and make recommendations for Menu changes

the four key menu categories28
The Four Key Menu Categories
  • Plowhorses are items that are relatively popular but have a high contribution margin. Items in this category can have their menu prices increased or the portion size cut in a attempt to increase CM. If market is price resistant
  • Stars have both high popularity and high CM
  • Puzzles have relatively low popularity and high margins; lower price.
  • Dogs are both low in popularity and CM; eliminate

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up selling
Up Selling
  • Manager’s Special

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placement
Placement
  • Two Schools of thought
  • Menu Sequence
    • Menu should follow progression of meal
  • Focal Points
    • Use focal points on the menu to push certain menu items

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focal points
Focal Points

Single Sheet Menu

Twofold Menu

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focal points33
Focal Points

Focal Point

Threefold Menu

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specials
Specials
  • Larger Bolder type than the rest of menu
  • Longer description
  • Concept of Closure
    • people’s eyes are drawn to what ever is enclosed by a box
  • Color, illustration, and/or pictures, bullets can be used to draw attention to signature items.

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branding
Branding
  • Fast food
  • Coke / Pepsi
  • TGIF
  • Jack Daniels

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menu pricing
Menu Pricing
  • Odd-Cents pricing
    • Majority of prices end in either a “5” or a “9”
  • Price rounding.
    • Within certain price bands, price increases have little negative impact on customers
  • Placement

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conclusion
Conclusion
  • Menu analysis is important
  • If demographic studies, internal capacities, cost cards, and markups have been executed correctly, the score should be a good one
  • Analysis should be done using either the Smith or the Hurst methods to ascertain the profitability of the menu
  • If the analysis shows a poor menu, make improvements
  • Good menu: first step has been taken toward running a profitable operation.
  • It’s just that simple

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where to get more information
Where to Get More Information
  • Mill, Robert Christie (1998) Restaurant Management: Customers, operations, and employees / Menu Scoring & Menu Engineering, pp 114-116. Upper Saddle River, N.J. : Prentice Hall.
  • Drysdale, John A. & Jennifer Adams Aldrich (2002). Profitable menu planning / Chapter 5: Menu Analysis, pp. 101-115. 3rd ed. Upper Saddle River, N.J. : Prentice Hall, TX911.3.M45 D79 2002
  • CD-ROM TX911.3.M45 D79 2002
  • Most Menu & F&B Management Books

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