Subject- Food & Beverage Service

Topic- Menu Engineering

3rd Year

IIHM Delhi

Faculty –Manish Saxena

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 MENU
ENGINEERING

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 Why we do ME-

The objective with menu
engineering is to maximize
profitability by leading the
customer to certain purchases
and avoiding others
unconsciously.
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
 How ?
 Gross Profit of a Dish = Selling Price - Cost
Price

 Garlic Bread = 100 – 10 = 90

 Bruschetta = 100 – 30 = 70

 Same Sale with different Gross Profit

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
MENU ENGINEERING'S PROFIT IMPACT- Research Fact

A restaurant’s profits increase

by 10% to 15% on an ongoing
basis.

(
[Link]
gineering/
Accessed on 19th May 2020)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
Menu Engineering- Definition

Menu engineering is the study of the

profitability and popularity
of menu items and how these two
factors influence the placement of these
items on a menu.

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 What is Menu Engineering?

“A quantitative model designed to

provide a basis for analysing a
menu’s success in both in terms
of attracting clientele and in
terms of profitability”
(Jones and Merricks, 2006, p. 205)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
Menu Engineering and Menu Pricing

 Menu Engineering can be viewed as

Revenue Management for Restaurants .
 Combining the “right” menu items, with
the “right” prices
 To ensure customers choose the items the
restaurant wishes to sell.
 This will maximize the revenue derived
from the restaurant’s limited seat
capacity.
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
To use Menu engineering concept-
We need to have 3 information without which
we can not use the concept-

1. Food cost of each menu item

2. Selling price of each menu item
3. Quantity sold over a specific period.

 The menu item's gross margin (selling price

minus food cost)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
Break your food and drink items into four different

categories.

1. Star: Popular and profitable

2. Puzzle: Profitable, but unpopular

3. Plow horse: Popular, but unprofitable

4. Dog: Unpopular and unprofitable

Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
 .

Plow

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
CALCULATION BEHIND
ME

Example-

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 A B C D E F G H        

Menu Item Item

Item No. Sold Menu Food Selling Item CM Menu Revenues
Menu Menu CM MM% Menu Item
Mix % Costs CM Category Category Classification
Name Cost Price

  MM            
                       
Chicken
Blue 420 2.7 5.95
Steak 360 4.5 8.5
Lobster
tail 150 8 9.5
Tenderl
oin 70 4 7.4
  N      
Total 1000    

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 A B C D E F G H        

Menu Item Item Menu

Item No. Sold Menu Food Selling Item CM Menu Revenue Menu Category
CM MM% Menu Item
Mix % Costs CM Category Classification
Name Cost Price s

  MM       E-D D*B E*B H-G      

                       
Chicken
Blue 420 2.7 5.95 3.25
Steak 360 4.5 8.5 4
Lobster
tail 150 8 9.5 1.5
Tenderl
oin 70 4 7.4 3.4
  N      
Total 1000      

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 A B C D E F G H        

Menu Item Item Menu

Item No. Sold Menu Food Selling Item CM Menu Revenue Menu Category
CM MM% Menu Item
Mix % Costs CM Category Classification
Name Cost Price s

  MM       E-D D*B E*B H-G      

                       
Chicken
Blue 420 2.7 5.95 3.25 1134 2499 1365
Steak 360 4.5 8.5 4 1620 3060 1440
Lobster
tail 150 8 9.5 1.5 1200 1425 225
Tenderl
oin 70 4 7.4 3.4 280 518 238
  N       I J M
Total 1000 4234 7502 3268      

  O=M/N (Av CM)

    3.268 
           
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
 A B C D E F G H        

Menu Item Item Menu

Item No. Sold Menu Food Selling Item CM Menu Revenue Menu Category
CM MM% Menu Item
Mix % Costs CM Category Classification
Name Cost Price s

  MM       E-D D*B E*B H-G      

                       
Chicken
Blue 420 2.7 5.95 3.25 1134 2499 1365 LOW
Steak 360 4.5 8.5 4 1620 3060 1440 HIGH
Lobster
tail 150 8 9.5 1.5 1200 1425 225 LOW
Tenderl
oin 70 4 7.4 3.4 280 518 238 HIGH
  N       I J M      
Total 1000 4234 7502 3268      

I/J (FC
K= %)  O=M/N (Av CM)
  56   3.268 
         
Topic - Food & Beverage Service -
 
Menu Engineering (Manish Saxena)
 A B C D E F G H        

Menu Item Item Menu

Item No. Sold Menu Food Selling Item CM Menu Revenue Menu Category
CM MM% Menu Item
Mix % Costs CM Category Classification
Name Cost Price s

  MM       E-D D*B E*B H-G      

                       
Chicken
Blue 420 42 2 .7 5.95 3.25 1134 2499 1365 LOW
Steak 360 36 4.5 8.5 4 1620 3060 1440 HIGH
Lobster
tail 150 15 8 9.5 1.5 1200 1425 225 LOW
Tenderl
oin 70 7 4 7.4 3.4 280 518 238 HIGH
  N         I J M    
Total 1000 100 4234 7502 3268      

I/J (FC
K= %)  O=M/N (Av CM)
  56   3.268 
         
Topic - Food & Beverage Service -
 
Menu Engineering (Manish Saxena)
 A B C D E F G H        

Menu Item Item Menu

Item No. Sold Menu Food Selling Item CM Menu Revenue Menu Category
CM MM% Menu Item
Mix % Costs CM Category Classification
Name Cost Price s

  MM       E-D D*B E*B H-G      

                       
Chicken
Blue 420 42 2 .7 5.95 3.25 1134 2499 1365 LOW HIGH
Steak 360 36 4.5 8.5 4 1620 3060 1440 HIGH HIGH
Lobster
tail 150 15 8 9.5 1.5 1200 1425 225 LOW LOW
Tenderl
oin 70 7 4 7.4 3.4 280 518 238 HIGH LOW
  N         I J M      
Total 1000 100 4234 7502 3268      

I/J (FC
K= %)  O=M/N (Av CM) Q= (100/ITEM)(70%)
  56   3.268  (100/4)*70%
         
Topic - Food & Beverage Service -
  Q= 17.5 
Menu Engineering (Manish Saxena)
 . Under this approach, all items,
which reach at least 70% of their
rightful share of the menu mix, are
categorised as enjoying high
popularity. For example; where a
menu consists of say 20 items, any
item that reached 3.5% or more of the
70 per menu mix (70% of 5%) would be
regarded as enjoying high popularity.
cent While there is no convincing
theoretical support for choosing the
70% figure rather than some other
percentage, common sense and
experience tends to suggest that there
is some merit in this approach.
 A B C D E F G H        

Menu Item Item Menu

Item No. Sold Menu Food Selling Item CM Menu Revenue Menu Category
CM MM% Menu Item
Mix % Costs CM Category Classification
Name Cost Price s

  MM       E-D D*B E*B H-G      

                       
Chicken PLOW
Blue 420 42 2 .7 5.95 3.25 1134 2499 1365 LOW HIGH HORSE
Steak 360 36 4.5 8.5 4 1620 3060 1440 HIGH HIGH STAR
Lobster
tail 150 15 8 9.5 1.5 1200 1425 225 LOW LOW DOG
Tenderl
oin 70 7 4 7.4 3.4 280 518 238 HIGH LOW PUZZLE
  N         I J M      
Total 1000 100 4234 7502 3268      

I/J (FC
K= %)  O=M/N (Av CM) Q= (100/ITEM)(70%)
  56   3.268  (100/4)*70%
         
Topic - Food & Beverage Service -
  Q= 17.5 
Menu Engineering (Manish Saxena)
Concept of Stars, Dogs, Puzzles &
Plow horses
 Promote “Stars”

 Exploit “Plowhorses”

Solve “Puzzles”

Eliminate “Dogs”

Topic - Food & Beverage Service - (Cousins, J.A., Foskett, D. and Pennington, A. , 2011)
Menu Engineering (Manish Saxena)
THE MENU-ENGINEERING PROCESS

The craft of menu engineering into four

steps:

1. Cost your menu. (You can’t skip this step!)

2. Categorize menu items according to profit
and popularity levels.
3. Design your menu.
4. Test your new menu design.
 
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
ACTIONS ON EACH
CATEGORIES

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Your stars (high profit and high popularity) are your
key profit drivers, bringing in high sales at high margins.

1. Don’t touch these menu items

2. Your menu should highlight your Stars items

3. Promoted vigorously
4. Can yield higher profits though price
5. Control standards
6. Service staff should recommend them when taking orders

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
“PLOW HORSES” (low profit and high popularity) items

should be restructured

• Solid sellers

1. Increase the price of the dish or

2. Decrease their cost of selling by

1. Reduce portion size except for signature items.

2. Substituting the expensive items without hampering the quality.

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Your puzzles (high profit and low popularity) are items you can

improve on.

1. Putting them in a visible place on the Menu

2. You could try moving these up on the menu .
3. Lowering their price to increase their popularity, thus turning
them into stars.
4. Providing special merchandising on the table
5. Make sure your servers are promoting these items

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
“DOG” (low profit and low popularity):

1. Remove these items.

However, this process must be seriously evaluated

in order not to lose some loyal customers.

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Focus Area

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 1. DESIGN YOUR MENU

Here are some things to keep in mind

when using this technique:

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
1. Proper Spacing—

1. Menu should not be too crowded.

2. Proper Menu Category to be placed. Like Appetizers,

Mains, Desserts, Drinks etc

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
 Proper menu Category

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
2. Highlighting Items—

1. Highlighted couple of item per

category.

2. Too many loses importance.

Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
3. Photographs—

Research indicates that using a photograph can

increase sales of an item by as much as 30% when there
is just one or two photographs on the page.
([Link] Accessed on 19th
May 2020)

(again, the more visual cues you add, the lower their
impact).
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
 Me
nu
wit
h
fe
w
Pic
tur
e

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 VS.

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Menu with too many Pictures

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
4. Use boxes to highlights —

This will attract the focus of the

customers

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
 5. Don’t list your prices in a
column down the right side of
your menu

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
a. Placing your prices in a column causes customers
to focus on price, not your food, and could lead
them to choose the cheapest item in the column.

b. Instead, place prices just two spaces after the end

of the item description, using the same type font
size and style.

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
 Vs

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
6. HAVE FUN WITH WORDPLAY
According to a study from Cornell, guests are willing to
spend almost 10% more on more descriptive menu
items. So, Anything relating to some unique adjectives
can really raise your menu readers’ eyebrows.

Using descriptive words like “crispy,” “soft,”

“smoked,” and more.

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
 7. There is a science to listing each
menu items

 The first few spots enjoy levels of importance that

correspond to their position in the list,

 But after that it is the last item in the list that gets the
most attention.

 The items just above the last item in the list are the most
ignored.
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
Topic - Food & Beverage Service -
Menu Engineering (Manish Saxena)
 Reference list
 Cousins, J.A., Foskett, D. and Pennington, A. (2011) Food
and beverage management: for the hospitality, tourism and
event industries. 3rd edn. Oxford: Goodfellow.
 Bernard, D., Lockwod, A.& Alcott,P. (2008) Food and

Beverage Management 4th edn. Oxford: Elsevier

 [Link]

 [Link]

(

[Link]
es/restaurant-menu-engineering/
Accessed on 19th May 2020)

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)
Thank you !!

Topic - Food & Beverage Service -

Menu Engineering (Manish Saxena)