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Menu engineering
1. 05/17/14 SAARC Train the Trainer
menu engineering principles
revisited
โข based on the bcg four box analysis
โข addresses issues of gross profit control and menu profitability
โข represents major break with past attitudes to menu pricing
โข we do not take percentages to bank โ but real time money
โข key words โ contribution margin and popularity
โข menu profitability measured through โ popularity and profitability
( cash gross profit โ contribution margin ) of each menu item
kasavana and smith - 1982
3. 05/17/14 SAARC Train the Trainer
โข stars / winners / prime โ menu item which is popular and profitable
โข puzzles / marginals / sleepers โ profitable but not popular
โข plowhorse / marginals / standards โ popular but not profitable
โข dogs โ neither popular nor profitable
menu engineering terminology
4. 05/17/14 SAARC Train the Trainer
steps to achieve menu profitability
โข analysis of popularity and profitability of each menu item:
popularity = no. of portions sold
profitability = contribution margin/cash gross profit
โข continual reappraisal of the choice of menu items โ very helpful
to us as we are committed to menu changes bi annually in our
outlets
โข continual reappraisal and review of menu prices, portion
costs and sometimes menu design
5. 05/17/14 SAARC Train the Trainer
strategies for dealing with stars:
โข maintain itโs high visibility
โข test for itโs price elasticity and increased prices
โข maintain the high level of quality, presentation and portion size
โข these are really your signature dishes
โข promote it internally with suggestive selling selling
โข in brief โ retain this item
6. 05/17/14 SAARC Train the Trainer
strategies for dealing with puzzles, marginals, sleepers :
โข lowering price point may increase popularity โ use the early bird
incentive method
โข basic question โ how do I increase popularity?
โข renaming menu item is an option as current name is not attractive
and heavily merchandise
โข re plating the menu item is an option to make it attractive
- working on accompaniments and portion size/quality
โข promote internally through word of mouth, table tent,displays,
menu boards, sales incentives
7. 05/17/14 SAARC Train the Trainer
strategies for dealing with plowhorse,marginals,standards:
โข these are demand generators and attract price sensitive guests
โข test price elasticity and eventually increase prices
โข try to reduce cost by buying differently, re costing recipe, re looking
at recipe, reducing portion, combining with less expensive items
โข may change physical location on menu
โข finally if labour cost of production is also high as well as cumbersome
( typically during rush hour ) โ then replace
8. 05/17/14 SAARC Train the Trainer
strategies for dealing with dogs , losers :
REMOVE FROM MENU
( Unless ownerโs favourite )
9. 05/17/14 SAARC Train the Trainer
Therefore - rule of thumb - the four โ rโ menu
engineering remedy
โข stars โ retain
โข plow horse โ re price
โข puzzles โ re plate
โข dogs โ remove