Menu engineering meaning in hospitality

Menu engineering is a strategy to design and price menus to maximise profit in hospitality. It involves looking at sales data, food cost and customer preferences to create a menu that encourages customers to order high profit items. This method categorises menu items by popularity and profit to enable managers to make informed decisions on pricing, placement and promotion of dishes.

Menu engineering is a powerful tool for hospitality because it affects the bottom line. By optimising menu layout and pricing, restaurants can increase average spend and revenue. This method helps identify which dishes are stars (high popularity, high profit), puzzles (low popularity, high profit), plowhorses (high popularity, low profit) or dogs (low popularity, low profit). With this information, managers can make data-driven decisions to improve menu performance and customer satisfaction.

Let’s say you’re a chef at a busy café. You notice your avocado toast is popular but has a low profit margin due to the high cost of avocados. Using menu engineering principles, you decide to slightly increase the price and move it to a less prominent position on the menu. At the same time, you move a new high profit breakfast bowl to the top right of the menu (where eyes go first) and add an image. After making these changes, you find sales of the profitable breakfast bowl increase, offsetting the decrease in avocado toast and increasing overall profit.'