Headlines corroborate what the foodservice industry already knows to be true: Menus are getting shorter. As the old saying goes, “work smarter, not harder.” A peek behind the curtain reveals that operators are adding to their bottom lines by using science to hone in on the right menu items.
The science of menu engineering has emerged as a critical tool for operators to maximize overall revenue and profitability. Restaurants, retail grocers and convenience stores that make data-driven decisions to adjust prices or item placement stand to benefit the most.
Menu engineering begins by plotting individual menu items on a matrix that balances profitability and popularity. Naturally, menu items will fall into one of four categories:
- Stars: high profitability, high popularity
Stars score at the top of both profitability and popularity — a win-win. These standouts should be promoted as much as possible. If only every menu item was this easy to assess. - Stars: Plow horses: low profitability, high popularity
These are solid-performing products that guests love. Unfortunately, they tend to be associated with higher food costs or more labor. To mitigate the thin margins, take a look at the food costs, menu prices and portion sizes associated with plow horses. - Stars: Puzzles: high profitability, low popularity
These menu items bring in profit on a per-unit basis. But, customers don’t order enough of them to fully realize their potential revenue. These enigmatic menu items present a challenge to the operator: to increase popularity without adding costs that diminish their substantial margins. - Stars: Dogs: low profitability, low popularity
These underperforming menu items become an easy target for elimination. Dogs are cost inefficient and don’t bring people in the door — a double whammy.
With data in hand, operators can take action. However, to do so, they need the right foodservice equipment at their sides. After all, any analysis that calls for higher profitability will call for kitchens that can function faster and more efficiently.
Speed and productivity
Modern foodservice equipment can speed up cooking times and increase overall productivity, allowing for a more efficient kitchen operation. By accelerating top-line growth, menu items can move away from the “plow horse” quadrant and be on a trajectory to become a “star.”
When an operator identifies a “star,” they should do everything in their power to promote and highlight that menu item. On a physical menu, these items should be boxed or set apart graphically. Whenever possible, rising “stars” need to be put in front of customers at every opportunity. Food display cases and merchandisers in well-trafficked locations such as endcaps or near payment areas can drive impulse sales and multiply revenues.
Reduced labor costs
Labor in the foodservice sector was hit hard during the pandemic and is only now starting to recover. As a result of that labor crunch, operators shrunk menus as a cost-saving measure. Extensive menus led to three negative implications: more prep time, more training and longer time spent on executing dishes.
Low-labor solutions reduce all three of these employment effects on payroll. It’s no coincidence that something as simple as avocado toast has “starred” on countless menus in recent years. And, you can’t have avocado toast without effortless toast. Foodservice equipment such as the Intelligent Toast-Qwik® Conveyor Toaster is easy to use and one of the most labor-friendly creations since sliced bread.
Streamlined inventory management and reduced waste
According to a recent report from the United Nations, the world wastes about 1 billion meals per day, which adds up to over $1 trillion of food wasted annually. This is a colossal waste of money and resources. This doesn’t even account for the ripple effect on the environment as water, livestock and land are exhausted to create food that ends up in a landfill — leaching methane.
There is a fiscal and ethical imperative for operators to avoid superfluous menu items costing an operation and the planet. The two greatest causes of food waste are human error and food spoilage. This is why operators need equipment that safely and properly stores food, either hot, cold or both. “Dogs” and “plow horses” will never have a chance to be anything but a drain if food inventory isn’t managed properly.
Energy efficiency
Energy efficiency can bring the cost of any operation down and help nudge every menu item toward the “star” quadrant in the profitability/popularity matrix. Nobody likes paying bills. Unfortunately, by the time you receive your energy bill, it’s too late. The key is to be proactive in saving energy.
There are simple steps such as putting equipment on a cleaning and maintenance schedule, making sure fridges and freezers have sealed gaskets and using LED lighting. But the greatest step an operation can take in this regard is to invest in the latest energy efficient technology. Foodservice equipment such as induction solutions use 85%-95% of the energy they generate, ensuring cooking energy is maximized and not wasted.
Science is on your side.
Electrical engineering makes foodservice equipment power on. Mechanical engineering makes it work. And menu engineering makes it profitable.
When you pair state-of-the-art foodservice equipment with data science, your operation can optimize profits. Mastering the science of menu engineering means that pricing, promotions and menu offerings are in alignment with your equipment provider.
The right foodservice equipment can give “plow horses,” “puzzles” and “dogs” a leg up. And it can let the “stars” truly soar.
Want to learn more about how the science of menu engineering can lead to increased profits? Contact us today.
