Menu engineering helps you evaluate your restaurant menu pricing by making the most of sales data, food costs and inventory items to help you decide which dishes to include and at what price. With this information you can categorise menu items according to their popularity and profitability
Running a restaurant involves many costs, the main ones being your overheads, labour costs and food costs. Menu costing is an essential part of restaurant management as it has a direct effect on your profitability, especially in times of high inflation. Understanding how food costing on your menu is calculated is important as it will help you:
Know how much the food in each recipe costs, so you can understand how much you can earn per dish.
Be able to properly price your dishes to hit your target profit
Discover how your competitors price their dishes against the industry benchmark
Monitor costs to find out when to reduce or increase the price of a dish.
Find out the profit margin for each dish and decide which to promote as loss-leaders to boost reservations
An inventory management system is a type of software for chefs and restaurant managers that helps them track the stock coming into your restaurant, what’s leaving your restaurant and what’s left over. Having good software for inventory management for restaurants will help you see where you’re losing money and how you could improve your profitability even further.
Life without a supplier relationship management system is more disorganised, your food will cost you more and may not always be of the best quality. You’ll spend more time on the phone shopping for the best prices and you may not always be first in line if you haven’t built good relationships. Using a supplier management system means all your supplier data is in one place so you can compare prices at a glance, order more quickly and buy better. All this means you save time, can work more objectively and efficiently and plan ahead – things your suppliers also appreciate. A precise ordering process will help you save money, reduce waste and improve your profitability.
Generally speaking, the most important ways to control your food costs are:
Streamline your inventory
Calculate food costs weekly
Portioning food correctly and consistently
Ensure you’ve also costed the garnish
Keep a record of all food waste
For larger multi-sites, centralise purchasing in a CPU
Use inventory management and menu engineering software