Remember when you could simply divide the cost of your ingredients by 0.33 and magically arrive at your menu price? Today, restaurant owners and managers agree that it’s not merely the math, but the strategy. Finding the best method for pricing in 2008 is a matter of blending traditional methods with some outside-of-the-box tactics.
Superior is pleased to offer you a few basics ~ and, as always, reminds you that creativity is often the difference between breaking even and breaking records!
First things first: Food Cost
It may seem like a no-brainer that how much you pay for your ingredients will determine how much you should charge for it. Although there is no longer a flat formula, it’s still a good rule of thumb to keep in mind that what it costs you to prepare a dish should be about 30-35% of the listed menu price.
For example, that double cheeseburger that costs you about a $1.00 from kitchen to table should be menu priced at a minimum of $3.35. Even though it may seem as though you are charging much more than necessary, remember included in that mark-up is not only the meat, lettuce, tomato, mayo and bun … but the cost to prepare, serve and clean up after that burger! Don’t forget: Your burger paid for last month’s electric service!
Two tomatoes in every salad: Portion Control
Nothing can destroy your inventory (and profit!) faster than sloppy portion control. Chain restaurants have learned this lesson well. Even their menus will tout Six Broiled Shrimp! Controlling the portions coming out of your kitchen may seem miserly (oh, who cares if there’s an extra tomato here or handful of chips more there), but careful plating will not only save money but will give to your guests the appearance of quality and consistency.
Practice portion control by beginning with these few easy steps: Weigh your meat products; invest in a few portion “control” cups for measurables ~ like grated cheese or diced onions; and consider buying pre-portioned items, like burgers. True, this last step may be initially more expensive but in the long-run can save in time and waste.
What’s Sam charging? Know Your Market
While it’s not good business sense to merely copy the pricing of a nearby competitor, it is excellent business savvy to know what others are charging. This is where the creativity comes in!
Sam charges $5.00 for his excellent quality, double-patty, quarter-pound burger. Serves it on newspaper in a fun paper basket. He includes fries. Before Sam’s price becomes yours, be certain you are comparing … burgers to burgers. You may be serving your burger on china and offering two types of fries …
Consider all of the factors that may ~ and will ~ make a difference in your bottom line. Everything from restaurant style to location to service type to clientele will determine the best price for you!
Consider the ground troops: Consult Your Staff
Harried though they may be, your staff has the very best vantage point for how things are really going. Do they find themselves constantly having to defend the price of the sea bass? Are they forever returning piles of uneaten mashed potatoes to the clean-up station? Are guests asking if “half-portions” are available?
All of these may be clues that can help you to determine the best way to tweak your pricing. Don’t hesitate to include your service staff in pricing decisions. Not only will you most likely receive some wonderfully helpful feedback, but you will show them you value their input: They’re a crucial part of your restaurant’s success!
Never think you know it all! Continuing Education
Whether you are attending a formal seminar or organizing a brainstorming session with local restaurant owners, the business value of feedback and tossing around ideas should never be underestimated.
From how to keep track of staff attendance to running a successful bar, Superior’s comprehensive line of manuals, books, CDs and DVDs has you covered!
If this blog entry has whetted your appetite to learn more, we suggest Controlling Restaurant & Food Service: Food Costs. This 144-page softcover book ships in three business days and will provide you with step-by-step techniques for lowering your food costs.
Catering? Check out our Catering Profit$ for Restaurants. Taped from a live seminar and offered to you in DVD format, this presentation will help you learn to package, price and promote catering in your market. Extra catering sales can easily double your bottom line profits ~ give it a try!
Find these great products and more at www.superiormenus.com.
We hope that this very brief course in Menu Pricing 101 gave you some fresh ideas or confirmed that you are on the right track. Please share your menu pricing tips ~ the do-s and the don’t-s ~ and join our blog!
Filed under: Food Business Tips, Menu Pricing, Restaurant Advice, Restaurant Supplies, Restaurant Tips | Leave a Comment »