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How to Calculate Your Menu Prices<br />Prepared by:<br />John Smith<br />http://www.BarBusinessBlog.com<br />
Designing your first menu is a fun activity!<br />  Deciding how to calculate your menu prices is not as fun…<br />We’ll c...
Calculating Food Prices<br />Find the cost of each item<br />We do mean every single item!<br />Use this formula:<br />Pur...
Calculating Food Prices<br />2. Add the costs together to total each dish<br />Meat:	$0.75<br />Vegetables:	$1.50<br />Con...
Calculating Food Prices<br />4. Adjust the price for the menu<br />A price of $8.33 or even $7.14 is really weird to see o...
Calculating Food Prices<br />5. Be prepared to change the price<br />How you price your foods will vary from time to time....
Calculating Drink Prices<br />1. What is your pour size?<br />Before you begin to price your drinks you need to know<br />...
Calculating Drink Prices<br />2. Price by Category<br />Most bars simplify pricing by setting a rate across a <br />catego...
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Food How drink menu prices

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Food How drink menu prices

  1. 1. How to Calculate Your Menu Prices<br />Prepared by:<br />John Smith<br />http://www.BarBusinessBlog.com<br />
  2. 2. Designing your first menu is a fun activity!<br /> Deciding how to calculate your menu prices is not as fun…<br />We’ll cover the basics of pricing your menu, <br />using a step-by-step process.<br />
  3. 3. Calculating Food Prices<br />Find the cost of each item<br />We do mean every single item!<br />Use this formula:<br />Purchase cost ÷ Portion<br />This is the portioncost.<br />So if you buy 100 pounds of meat and it cost $1.50 per pound, your purchase cost would be $150. <br />If you use a half pound of meat per portion in your meal, you take $150/200 (half pound divided by 100) to make a $0.75 per portion.<br />
  4. 4. Calculating Food Prices<br />2. Add the costs together to total each dish<br />Meat: $0.75<br />Vegetables: $1.50<br />Condiments: $0.25<br />Total: $2.50<br />3. Divide Food Cost by a Percentage<br />Most bars and restaurants have a food cost of around<br />30% to 35% of the total price.<br />$2.50 ÷ 30% = $8.33<br />$2.50 ÷ 35% = $7.14<br />
  5. 5. Calculating Food Prices<br />4. Adjust the price for the menu<br />A price of $8.33 or even $7.14 is really weird to see on<br />a menu right? Adjust to a level that most customers<br />are familiar with.<br />$8.33 -> $8.50<br />$7.14 -> $7.25 or $7.00<br />
  6. 6. Calculating Food Prices<br />5. Be prepared to change the price<br />How you price your foods will vary from time to time. <br />You will have to meet competitors and the changing<br />market by raising and lowering of your prices.<br />In general, people can handle a move within a dollar than<br />outside of a dollar.<br />$5.75 to $6.50 is a higher “change” than $7.25 to $7.95.<br />Most customers only look at the first digit.<br />
  7. 7. Calculating Drink Prices<br />1. What is your pour size?<br />Before you begin to price your drinks you need to know<br />your pour size.<br />The pour size is simply how much alcohol a customer gets<br />in his order.<br />Most drinks are 1 ounce or 1.5 ounces; so in a liter of<br />alcohol, you can get at maximum 33 ounces of alcohol.<br />Use this formula:<br />Price of per bottle ÷ number of ounces<br />
  8. 8. Calculating Drink Prices<br />2. Price by Category<br />Most bars simplify pricing by setting a rate across a <br />category:<br /><ul><li>Well
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  10. 10. Premium</li></ul>This type of pricing does lead to some irregularities, but it <br />is generally okay for drinks (which require no preparation).<br />The exact price to charge per drink is tough to say, use a<br />percentage that will allow you to compete favorably with<br />competitors, but also appeals to customers.<br />Use this formula:<br />Price per ounce ÷ percentage<br />
  11. 11. This slideshow was prepared by John Smith.<br />Get more information on starting a bar business by visiting this post or by going to http://www.BarBusinessBlog.com today!<br />Image provided by: Simon Howden / FreeDigitalPhotos.net<br />

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