Restaurant Menu Mgt

Restaurant Menu Management
Aftab Umrani
Aftab Umrani F&B Training Manager

Introduction
 Everything starts with the menu. The menu
dictates much about how your operation will be
organized and managed, the extent to which it
meet its goals, and even how the building itself -
certainly the interior - should be designed and
constructed.
 Menu is also know a Contract with Restaurant and
Guest through that both parties are agreed to Deal
with each other.

Introduction
 The menu is the most important document in a
restaurant. It tells the customers what is on offer
and what to expect.
 Menus offer a wide array of dishes, ingredients,
options and styles. These are due to diverse
cultures and history, global cuisine and service
trends have absorbed elements from many different
cultures.
 Menu styles and designs are impacted by the type
of establishment, its clientele and the price points.
 Menus cover all service styles and offerings
throughout the day form breakfast through to dinner

Menu Styles
1. À la carte Menu
2. Table d'hôte Menu
3. Combination Menu
4. Fixed Menu
5. Cycle Menu

À la carte Menu
À la carte (also a la carte), is a French phrase
meaning "from the menu", and it is used in
restaurant terminology in one of two ways:
First, it may refer to a menu of items priced and
ordered separately rather than selected from a list
of preset multi-course meals at set prices.
A la Carte (items are listed and priced separately)

À la carte Menu

Table d'hôte Menu
Table d'hôte is a French Phrase that literally means
"the host's table“
• table d'hôte menu is a menu where multi-course
meals with only a few choices are charged at a
fixed total price. Such a menu may also be
called prix fixe ("fixed price"). The terms set
meal and set menu are also used.
• The cutlery on the table may also already be set for
all of the courses.
• Table d'hôte contrasts with "à la carte", where
customers may order any of the separately priced
menu items available.

Table d'hôte Menu

Combination Menus
Many Operation have menus that are a Combination
of Table d'hôte and À la carte.
 They give both choices to guest
 KFC, MacDonald's and Pizza hut follow this style
 Customer can make their own desire setting in
meal

Fixed Menus
Fixed menus a single menus for several months or
longer before replacing it with new fixed menu.
 Daily special may be offered
 Can add new item take feed back from guest
 Customer engagement and knowing desire of guest

Cycle Menus
Cycle menus designed to provide variety for guests
who eat at an operation frequently - or even daily.
The easiest menu format to use is a cycle menu. A
cycle menu is one which is planned for a specified
period of time and then repeated.
 Special occasions and seasonal foods are added to the
menus at the beginning of the cycle
 ƒThe State Agency or other funding source may require a
specific number of weeks for the cycle menu.
 The basic cycle menu is designed for participants without
special nutrition needs.

Others styles of Menus
 Traditional menus featuring starters, main courses and
desserts with a selection within courses
 Specials menu which may be focussed on specials e.g.
seasonal or local product or catch of the day
 Blackboard menus allowing for flexibility but need to be
legible and clean. Spelling can be a problem
 Contemporary menus which can feature all sorts of
combinations e.g. Breakfast all day, menu items that can
be ordered entrée size or larger, special themes etc.
 Verbal menus are rare as the wait staff has to explain the
whole menu and customers have to remember the
choices. This can however provide a perfect platform for
up-selling

Types of Menus
There are Three Basic Types of Menus in other
words, these menus are designed around the three
traditional meals periods.
1. Breakfast Menus
2. Lunch Menus
3. Dinner Menus

Breakfast Menus
Breakfast menus are fairly standard. Many Operations
in both the commercial and non commercial
segment offer choices of fruits, juices, eggs,
cereals, pancakes, waffles, and breakfast meats.
 Typically Breakfast items are simple and fast to serve
 Inexpensive items in Breakfast Menu
 To keep prices down and make quick service possible, most
breakfast menus are relatively limited, offering only essential.

Lunch Menus
Like Breakfast guests are usually in a hurry. Therefore
lunch menus must also feature menu items that are
relatively easy and quick to make. Lunch Menus
features sandwiches, soups, salads, specials etc.
 Lunch usually lighter than dinner menu items
 Lunch Menus must have variety many guests eat lunch at the
same Restaurant several times a week.
 Most Lunch menus offer specials every day.
 Lunch Menus usually offer smaller Portion than dinner menus,
because most guests do not want to feel full sleepy during the
afternoon.

Dinner Menus
Dinner is the main meal of the day for most people,
and menu items offered at dinner usually are
heavier in character and more elaborate than those
offered at lunch and breakfast.
 Dinner is mostly offered as an à la carte menu unless it is
served as part of a function. Degustation or tasting menus
have also become popular for dinner again.
 Dinner is served after 6pm
 In a normal 3-course dinner the entrée is small and light, the
main course is larger with more robust flavours and the
dessert is lighter
 4-12 courses of small servings showing off the skills of the
chef Aftab Umrani F&B Training Manager

Types Of Menus - Specialty
 Children’s
 Senior citizens’
 Alcoholic beverage
 Dessert
 Knob Menu
 Room service
 Take-out
 Banquet
 California (breakfast, lunch and dinner menu items
on one menu)
 Ethnic

Priority Concerns of the Menu
Planner
Wants & Needs
Guest
Quality of item
FlavorConcept of value
Item Price
Objective of Property visit
Socio Economic Factor
Demographic Concern
Ethnic Factors
Religious Factors
Cost / Budget
Personal Concern
Ingredients
Equipment Con
Theme / Cuisine
Lay out Con
Sanitation Con
Consistency
Texture
Nut: Conc
Visual
Aromatic
Temp:

Basic Rules Of Menu Planning
 Know your guest
 Food preference
 Price
 Age
 Know your operation
 Theme or cuisine
 Equipment
 Personnel
 Quality standards
 Budget

selecting Menu items
The items listed on a menu often can be categorized
 Appetizers
 Salad
 Soup
 Entrée
 Dessert
 Beverages

Appetizers
An appetizer is part of a meal that's served before the
main course.
 Usually, an appetizer is a small serving of food — just a few
bites — meant to be eaten before an entree, and often shared
by several people.
 You can also call an appetizer an hors d'oeuvre. An
appetizer is meant to stimulate your appetite.
 Hors d'oeuvre in French means "outside the work"—that is,
"not part of the ordinary set of courses in a meal"

Salad
A salad is a dish consisting of small pieces of food,
which may be mixed with a sauce or salad
dressing. They are typically served cold. Salads
can incorporate a variety of foods
including vegetables, fruits , cheese,
cooked meat, eggs, grains and nuts.
 The word "salad" comes from the French salade of the same
meaning, from the Latin salata (salty), from sal (salt). In
English, the word first appears as "salad" or "sallet" in the
14th century

Soup
Soup is a primarily liquid food, generally served warm
(but may be cool or cold), that is made by
combining ingredients such as meat and
vegetables with stock, juice, water, or
another liquid.
 The word soup comes from French soupe ("soup", "broth"),
which comes through Vulgar Latin suppa ("bread soaked in
broth") from a Germanic source, from which also comes the
word "sop", a piece of bread used to soak up soup or a
thick stew.

Entrée (Main Course)
The main course is the featured or primary dish in
a meal consisting of several courses. It usually
follows the entrée ("entry") course. In the United
States and parts of Canada, it may be called
"entrée".
 The main dish is usually the heaviest, heartiest, and most
complex or substantive dish on a menu.
 The main ingredient is usually meat, fish or another protein
source. It is most often preceded by an
appetizer, soup or salad, and followed by a dessert.
 For those reasons the main course is sometimes referred to
as the "meat course".

Entrée (Main Course)
 In France, the modern restaurant menu meaning of "entrée" is
the course that precedes the main course in a three-course
meal, i.e. the course which in British usage is often called the
"starter" and in American usage the "appetizer". Thus a typical
modern French three-course meal in a restaurant consists of
"entrée" (first course, starter (UK), appetizer (U.S.)) followed
by the "plat" or "plat principal" (the main course) and then
dessert or cheese. This procession is commonly found in prix
fixe menus.
 Russian service is carried out rapidly and warmly; first,
oysters are served; after the soup, hors d'oeuvres; then the
large joint of meat; then the entrées of fish, fowl, game, meat,
and the entremets of vegetables; then the roast meat with
salad. The service ends with the desserts:

Dessert
The course usually consists of sweet foods, The term
"dessert" can apply to many foods, such as cakes ,
cookies, biscuits, gelatins, pastries, ice
creams, pies, puddings, custards, and sweet
soups. Fruit is also commonly found in dessert
courses because of its naturally occurring
sweetness.
 The word "dessert" originated from the French
word desservir, meaning "to clear the table.
 Dessert is high profitable items in menu where from less cost
presents high returns.
 Guest loves to eat Dessert after main course.

Beverages
beverage is a liquid intended
for human consumption. Although all beverages,
including juice, soft drinks, and carbonated drinks,
have some form of water in them, water itself is
often not classified as a beverage, and the
word beverage has been recurrently defined as not
referring to water.
 When the human body becomes dehydrated it experiences
the sensation of thirst.
 water is essential for life, it has also been the carrier of many
diseases

Menu Information
Some of the information listed on a menu includes:
 Number of courses
 Number of dishes within each course
 Description of the dishes
 Dietary information e.g. suitable for health
 Cultural origin of the dish
Chefs use a wide and ever increasing variety of techniques when
making their dishes. The methods and presentation used vary
between establishments, menus, dishes and service periods

Legal Implications
 Menus are a contract between the customer and the
establishment. The item stated on the menu must be served
or any changes must be indicated to the customer prior to
sale e.g. If you run out of salmon you cannot simply replace it
with another fish
 Weights and prices are also binding e.g. a 300g rump steak
cannot be lighter and if the price is $30.00 you cannot charge
$35.00
 Service of alcohol is often legislated based on age or the
amount that can be given to a customer
 Records of menu sales and overall revenue are subject to
taxation

Menu Factors
Key factors contributing to the type of menu
presented in a restaurant are:
 Style of restaurant and its design
 The setting and ambience created by the building and decor
 The price point or cost of food and beverages and value
offering to the customer
The staff skill level and how they handle:
o Greeting and seating of customers
o Service style such as Fine dine service or simple counter
service
o Food service and wine service and attention to detail
o Technical expertise of staff and ratio of staff to customers

Menu Planning

Principles of Menu Planning
 Colour – provide a range of colours within each dish and within
menus. Consider that the “eye eats first and you never get a second
chance at a first impression.”
 Texture – vary the textures of the products within a menu and on the
individual plate. Soft, crunchy, crisp items create natural contrasts
and enhance the eating experience
 Flavour – balance your flavours within the menu or on the one plate.
Spicy items will dominate the palate and should not be served first if
lighter items follow
 Cookery method – avoid using just one cookery method. Serve a
grilled steak with fried potatoes and glazed vegetables or fresh
salads. This will also enhance the taste, flavours and colours
 Ingredients – vary your ingredients as much as possible within the
menu and individual dishes. This provides for interesting
combinations and gives a wide choice to the customer
 Naming the dish – explain any foreign terms and use clear
descriptions of ingredients and cooking methodsAftab Umrani F&B Training Manager

Other key considerations are:
 Commodities – vary the types of commodities used to allow
for customer preferences e.g. a selection of seafood, meat
and vegetarian options
 Seasons – choose items in season as they are in their prime
and cheaper
 Design – it needs to be aligned to the overall philosophy of
the establishment e.g. A classical font for a traditional
restaurant or light colours and modern fonts for casual dining
 Establishment philosophy – what kind of service and
customer experience are you aiming for? What type of
restaurant are you?

 Dietary needs – customers can have a wide range of diets
based on their personal preferences or culture. Some of the
diets encountered are:
 Vegetarian diets – vegan, ovo-lacto, lacto
 Health diets – allergies, diabetes, low cholesterol, weight
loss, pregnant women
 Religious diets – kosher meals for Jews, halal for muslim,
vegan meals for Buddhists

Menu Knowledge Guest
Information
The menu presented in a restaurant is its key
marketing tool and staff must have thorough
knowledge of:
 The menu items on offer and the cookery methods used
within
 The ingredients used in the dishes listed on the menu and
where they are sourced
 The garnishes used for different menu items e.g. Café de
Paris butter
 Portion sizes of all dishes e.g. Fillet steak is 200g
 Appropriate accompaniments e.g. Fried matchstick
potatoes for the fillet steak
 Sequence of food served

Menu Knowledge Guest
Information
 Timing of cooking for the different dishes on the menu e.g.
soufflé will take 20 minutes
 The price point or cost of food and beverages and value
offering to the customer such as specials, wine of the
month, daily special
 Be responsive to customer requests and queries as well
as suggesting alternatives e.g. dietary alternatives, offer 2
entrées if smaller meals are desired
In order to provide excellent advice to your clients you must know
your menu sequence and style, items offered and how the
dishes are cooked and presented.

Customer Suggestions
 Explain any specials e.g. fresh asparagus or local berries
 Advice customer on alternatives in case of any health issues
or special dietary requirements e.g. “We can grill the chicken
instead of crumbing it to avoid any gluten contamination”
 Provide alternative options in case you run out of any menu
items
 Enquire about their food preferences and make appropriate
suggestions
 Promote additional dishes as starters, accompaniments or as
dessert e.g. “You must leave room for our fresh strawberries
in Grand Marnier “
 Advice on suitable accompaniments to a dish such as salads,
vegetables or starches e.g. The rocket and pear salad will be
an ideal accompaniment to the fillet steakAftab Umrani F&B Training Manager

One of the key skills needed in the service industry is a
strong customer focus. Customers should be made felt at
home and good service ensures return visits. Knowing the
food and drinks menu is crucial:
 Enjoy serving customers
 Portray a professional image and be positive about your
establishment
 Focus on customer needs and share relevant information for
menu items such as the types of whisky available, specials
and possible events coming up

 Speeds up service and allows for fast and efficient service
based on good systems
 Customers come to an establishment for the experience not
only the food or service!
 Sales support your establishment and your job, so be
proactive whilst enhancing the experience of the customer
 Allows you to advice customers on special needs such as
dietary needs

Other menu specific information that the
customer may want to know are:
 The cookery methods used within each dish. You must
understand the key principles of each cookery method such
as:
o Boiling, poaching, steaming
o Roasting, baking, pot roasting.
o Grilling, broiling.
o Frying, sauté, flambé, stir-frying, deep-frying

 Usually a combination of cookery methods is used but you
should be aware that a customer may be on a special diet and
thus you could offer a steamed fish instead of a fried item. You
must be able to explain why certain cookery methods are
used with different food types
 Explain the degree of doneness used for any items that may
not be cooked all the way through such as roast beef, beef or
veal steaks or salmon medallion.
 The internal temperature is listed:
o Well done (bien cuit) 70-75°C – the item is cooked all the way with no
visible blood
o Medium (a point) 60-65°C – the item has a slight pink tinge
o Medium rare (saignant) 50-55°C – the item has a stronger reddish tinge
o Rare (bleu) 45-50°C – the item is raw in the centre

Menu Design
• Design of a menu can influence:
 Guests Purchasing Decision
 Stimulate Sales of Additional / Preferable
Menu Items
 Increase the Guest Check Average
• Readability / Artwork / Type Styles /
Physical Design and layout play an
important role in merchandizing

Menu Changes
External Factors:
 Consumer Demands
 Economic Conditions
 Competition
 Supply Levels
 Industry Trends
Internal Factors:
 Facility’s Meal Pattern
 Concept / Theme
 Operational System

Common Menu-Design Mistakes
 Menu is too small: crowded menus are usually unappealing
and are not he sales tools because they are harder to read
 Type is too small: not every guest has 20/20 vision, and
lighting in some dinning room is quite dim. Guest cannot order
what they cannot read
 No or inadequate descriptive copy : some time name of the
menu item does not describe the item or sufficiently spark
guest interest, Good descriptive copy increase sales.
 Every item is treated same: A menu designer should use
positioning, boxes, color, decorative borders, larger types or
some other device to call attention
 Some of the operations food and beverages are not
listed: Under some other heading items listed like Dessert
written in Beverages Colum etc.

Common Menu-Design Mistakes
 Clip on Problems: clip-on allow on blank space and do not
hide important menu items and clip-on must match with
design, theme and quality of menu. A disorganized clip-on
poorly printed on inferior paper can destroy the effect of well-
designed menu
 Basic information about property is not include: it is
surprising how many restaurants do not include their address,
phone number hours of operation and payment policies on the
menu.
 Blank pages: blank pages of menu does nothing to sell
 Spelling Mistakes: Must Proof reading and be carful about
spelling like “Dessert” not “Desert”

Menu Pricing
After a menu is planned and cost, each item
has to be priced.
There are various factors to take into
consideration such as the:
 Type of Operation
 The Market
 Costs
The market is a major factor in the type of
pricing.
 Certainly most customers want only low prices; others seek
moderate ones; some will be willing to pay higher prices.
 The Key is to establish a fine balance between the Price and
Quality of Food offered by the Operation all other
parameters being the same.Aftab Umrani F&B Training Manager

Calculating Menu Selling Prices
 There are two main types of Pricing
Techniques.
1. Subjective Pricing
Method
2. Objective Pricing Method

Subjective Pricing Methods
Prices determine to a large extent whether
the financial goals of the Operation are met,
many managers use very Subjective Pricing
Methods.
Subjective Pricing Methods establish Prices,
however, fail to relate them to Profit
Requirements and even Costs.
This Pricing method is based merely on
assumptions.

The Reasonable Price Method:
o The method uses a price that the Operator
thinks will represent value to the guest.
o In other words, the Operator puts himself in the
guest’s shoes and asks “How much am I willing
to pay for this Item, considering the type of
setting?”
o The answer to this is the Reasonable Pricing
Method.

Highest Price Method:
 Using this Pricing Method, the Operator sets the
Highest Price for an Item that he thinks the
Guest is willing to pay.
 This is pushing the concept of Value to the
Maximum. A High Price is set then “Backed Of”
in order to provide for an Error Margin in the
estimate

Loss Leader Pricing Method:
 In this type of Pricing Method, the Menu Items
are Priced very low.
 The philosophy for this Pricing method is that
the Guests will be attracted to the Operation due
to Low Prices and will then buy other items while
they are there (Spin Off Business).
 In this case, it is very important to sell other
items to make Profit. This Pricing method is
used as an Early Bird Promotion to attract
specific market segments.

The Intuitive Price Method:
 Like the name suggests, Prices are set by
Intuition of the Operator alone. The Operator
takes a little more than a “Wild Guess” about the
Selling Price.
 It differs from the Reasonable Price Method in
that it takes a little less effort to determine the
price as one does not consider what would
represent Value to the Customer.

 Drawbacks:
a) Cannot relate to the Profit Requirements of
the Operation.
a) Cannot relate to the Cost of a Menu Item.
b) Solely based on Assumptions, Guess Work
and Hunches.
c) Seldom works in an era where Consumers
are looking for “Value for Money” and AP
Prices of Ingredients are sky rocketingAftab Umrani F&B Training Manager

Objective Pricing Methods
Simple Mark –Up Pricing Methods
 Ingredient Mark – Up
 Prime Ingredient Mark – Up
 Mark – Up with Accompaniments Costs
Contribution Margin Pricing Method
Ratio Pricing Method
Simple Prime Costs Method
Specific Prime Costs Method

Simple Mark – Up Pricing Methods
 It considers a Mark – Up from the Cost of Good
Sold (In the case of a Menu Item, that would be
the Standard Food Cost).
 The Mark – Up is designed in such a way that it
covers all Costs to Yield the Desired Profit
Levels.

 Simple Mark – Up Pricing Methods:
a) Ingredient Mark – Up Method
o This Pricing method attempts to account for all
Product Costs (Food Cost in case of Food and
Beverage cost in case of Beverage).
o Steps:
 Determine Ingredient Costs
 Determine Multiplier to Mark – Up Ingredient Costs
 Determine the Base Selling Price.

a) Ingredient Mark – Up Pricing:
Multiplier = 1
Desired Food Cost Percentage
o Example:
 If you want to keep your Food Cost as 40% then:
 Multiplier = 1 / 40%
= 1 / .40
= 2.5

Simple Mark – Up Pricing Methods:
a) Ingredient Mark – Up Pricing:
 Assume that a Seafood Platter has a Standard Food
Cost / Portion of a Seafood Platter is $ 5.32
 If a Food Cost % of 40% is desired:
 Base Selling Price (B.S.P.) = $ 5.32 x 2.5
= $ 13.30

b) Prime – Ingredient Mark – Up Pricing
 This method differs from the Ingredient
Mark – Up Pricing in that it concerns
itself with only the Prime Ingredient of
the Menu Item.
 Only the Cost of the Prime Ingredient is
Marked Up. The Multiplier is usually
higher in Order to account for the Cost
of the ancillary ingredients in the recipe.

(Example)
– Using the same example as above, Consider
the Cost of Prime Ingredient in a Seafood
Platter as $ 2.65 (Prime Ingredient being
Lobster)
– The Multiplier = 5 (Higher than the regular
M to account for other ingredients)
– Hence, B.S.P.
= $ 2.65 x 5
= $ 13.25

– If the Cost of the Prime Ingredient increases to $
2.75 per Dinner Portion, then the new B.S.P.
= $ 2.75 x 5
= $ 13.75
– The Pricing method approach assumes that the
Cost of other Recipe Ingredients increases in
Proportion to the Cost of the Prime Ingredient

c) Mark – Up with Accompaniment Costs:
– In this pricing method, the Operator determines
the ingredient costs based only upon the Entrée
items and then a Standard Accompaniment cost
/ Plate Cost is added before Multiplying by a
Mark – Up.

c) Mark – Up with Accompaniment Costs:
 Example:
– Entrée / Primary Costs = $ 3.15
Plate Cost = $ 1.25
Estimated Food Cost = $ 4.40
Mark – Up Multiplier = $ 3.30
Base Selling Price = 14.52

 Determining the Multiplier:
 The Mark – Up Pricing Methods are simple to
use and hence are commonly used in the
Hospitality Industry.
 A significant disadvantage involves
determining the Desired Food Cost %.
 Pricing method does not reflect higher / lower
Labor Costs / Utility Costs associated with the
Menu Item.

Contribution Margin Pricing Method:
– Contribution Margin
= Selling Price – Food Cost
– We can define Contribution Margin as the
Amount left after deducting the Food Cost
from the Selling Price of the Menu Item. This
is amount left behind to meet all Non Food
Expenditure and Profit Requirements.

– Example: Consider the given data obtained
from the Operating Budget of the Restaurant:
Non – Food Costs = $695,000
Profit Required = $ 74,000
No. of Guests Expected to be served = 125,000
• With the above information, compute the B.S.P. of
a Menu Item with a Food Cost per portion of $4.60.

 Step A)
Determine the Avg. C.M. per Guest:
Avg. C.M. / Guest = (Non F.C. + Profit Req.)
Total No. of Guest Served
= ($ 695000 + $ 74000) / 125000
= $ 6.152
 Step B)
Determine the B.S.P:
B.S.P. = $ 4.60 + $ 6.152 = $ 10.8

Ratio Pricing Method:
• Data:
• Food Costs = $ 435,000
• Non – Food Costs = $ 790,000
• Profit Requirement = $ 95,000
• Standard Food Cost of Menu Item = $
4.75
• Step A) Determine the Ratio of Food
Costs to N.F.C and Profits:
(All N.F.C. + Profit) / Food Costs = Ratio (R)

 Ratio = ($ 790000 + $ 95000) / $ 435000
 Ratio = 2.03
• This Ratio implies that for every $ 1 earned to
cover Food Cost we have to earn $ 2.03 to cover
N.F.C. and Profit Requirements
• Step B) Amount of N.F.C. and Profit
Required:
 The Cost of the Menu Item is $ 4.75
 Amount required to cover all Non F.C. and Profit
Requirements
= $ 4.75 x 2.03 = $ 9.64

• Step C) Determining the Base Selling
Price for Menu Item:
B.S.P. = $ 4.75 + $ 9.64 = $ 14.39

 Simple Prime Costs Method:
i. The term Prime Costs refers to the most
significant Costs in a Food & Beverage
Service Operation. Prime Costs for any
F&B Operation would be:
a) Labor Costs
b) Food Costs
ii. This method involves assessing Labor
Costs and Food Costs for the operation
and then factoring these into the Pricing
Equation. Aftab Umrani F&B Training Manager

Simple Prime Costs Method:
o Data:
Menu Item Food Cost = $ 3.75
Labor Cost = $ 210,000
Number of Exp. Guest = 75,000
Desired Prime Cost % = 62%

 Step A) Labor Costs per Guest =
$ 210,000 / 75,000
=$ 2.8
 Step B) Determine the Prime Cost per
Guest
= $ 3.75 + $ 2.8
= $ 6.55

 Step C) Computing Base Selling Price:
B.S.P. = Prime Costs per Guests
Desired P.C.%
B.S.P. = $ 6.55 / 62 %
= $ 10.56
• An obvious disadvantage of this Pricing method
is to assign an equal share of Labor Costs to all
Menu Items. This is not true as the Labor Cost
of each item may greatly differ.Aftab Umrani F&B Training Manager

Specific Prime Costs Method:
 In this type of Menu Pricing the F&B Operator
develops mark –ups for Menu Items which takes
into account their Food Costs and also their Fair
Share of Labor Costs.
 This method tries to overcome the limitations
of the Simple Prime Costs Method.
 In this method, Menu Items requiring more labor
intensive preparation would have a higher mark
up and those involving less labor during
preparation would have a lower mark – up.

.
.
Step A)
Step B)
Exam
ple:
Computations for Specific Prime Costs Method
The Operator first divides all Menu Items into 2 Categories. One which requires extensive labour during preparation and
the other which does not require extensive labour preparation. This decision is based with the Operator.
The Operator then assigns % of Total Food Cost and Labor Costs to each Menu Item. All % are in relation to the Total
Food Revenue.
60% of the Total Food Cost is expended on Items requiring extensive Labor during preparation. (Cat A Items)
Note:
0 for CAT
B
Note:
40% of the Total Food Cost is expended on Items not requiring extensive Labor during preparation. (Cat B Items)
55% of all Labour Costs is incurred for Preparation of all Menu Items.
45% of all Labor Costs is incurred for Non - Preparation Activities. (Waiting / Clean -Up)
Exam
ple:
60% of the Total Food Cost is expended on Items requiring extensive Labor during preparation. (Cat A Items)
Food Cost 35% 60% of 35% = 21% 40% of 35% = 14%
The above % can be computed from the Operating Budget of the Food & Beverage Operation.
Budget Item Operating Budget % CAT A Items CAT B Items Remarks
60% of 13.5% = 8.1% 40% of 13.5% = 5.4%
Labor Cost 30% 55% of 30% = 16.5%
Negligible Costs of Preparation
associated with CAT B Items. Hence we
assign all Preparation related Labour
Cost to CAT A Items
Profit 15% 60% of 15% = 9% 40% of 15% = 6%
All Other Costs 20% 60% of 20% = 12% 40% of 20% = 8%
30% -16.5% = 13.5% is the Labour Cost % for Non - Preparation Related Activites. It is assumed that that this
% is shared between CAT A. and CAT B. Items
In order to compute Base Selling Price of the Menu Item, simply Multiply the Standard Food Cost of the Menu Item by the
appropriate Multiplier depending on the Category of the Menu Item.
Mark-Up 2.86 3.17 2.39
Total 100 66.6 33.4

 Specific Prime Costs Method:
o Disadvantages:
 Very Time Consuming as All Menu Items
have to be Classified and then the %
Costs have to be allocated to each Cat.
 Assumption that all other Costs vary in
relationship to the Food Cost
Associated with the Menu Item.

Pricing Considerations
 The Base Selling Price is the Starting
Point for deciding the S.P. of a Menu
Item. The B.S.P. is further subjected to
further assessment based on several
factors.
 Factors upon which the S.P. is decided:
a) Concept of Value
b) Law of Supply and Demand

Pricing Considerations
Factors upon which the S.P. is decided:
 Volume Concerns – Higher the Volume / Turn
Over lower the Overheads and vice versa.
 Competition
 USP – Unique Sales Proposition

Evaluating the Menu
The menu is the most important tool
influencing the success or failure or a Food
& Beverage Operation.
The Process of Menu Engineering is an
increasingly popular tool in Evaluating the
menu.
Any menu item is evaluated on the basis of
two criteria Popularity and Profitability.

Evaluating the Menu
 Based upon the criteria of Popularity and
Profitability, the Menu item can be
classified into 4 Categories:
1) STARS: High Popularity and High Profitability
2) PLOWHORSES: High Popularity and Low
Profitability
3) PUZZLES: Low Popularity and High
Profitability
4) DOGS: Low Popularity and Low
Profitability

Evaluating the Menu
Defining Profitability:
– The basis of measuring the degree of
Profitability of a menu item is the “Average
Contribution Margin (A.C.M.).
– A menu item is said to be Profitable when it’s
individual C.M. is greater than A.C.M.
A.C.M. = Total Contribution Margin
Total Menu Items Sold

Evaluating the Menu
Defining Popularity:
 The basis of measuring the degree of Popularity
of a Menu Item is called as the “Popularity
Index.”
 The purpose of analysis, each menu item is said
to be equally popular: i.e. each menu item
contributes an equal share to the total number of
units sold.

Evaluating the Menu
Therefore, ideally the Popularity of each
menu item is computed as 100% (Total No.
of Units Sold) / Total No. of Items on the
Menu.
 Example: If there are 10 Items listed on the
menu, then ideally the expected popularity of
each menu item should be 100% / 10 = 10%
(10% of the Total No. of Units Sold).

Evaluating the Menu
Menu Engineering assumes that an item
is Popular if it’s unit sales equal or
exceed 70% of the Expected Sales of the
Item or 70% of 10% as per the above
example = 7%

Evaluating the Menu
.
Date: 1/9/05
420 42 5.21 7.95 2.74 2188.2 3339 1150.8 LOW HIGH HORSE
360 36 9.95 14.5 4.55 3582 5220 1638 HIGH HIGH STAR
150 15 8.5 12.5 4 1275 1875 600 HIGH LOW PUZZLE
70 7 7.95 9.45 1.5 556.5 661.5 105 LOW LOW DOG
1000 100 7601.7 11095.5 3493.8
Chicken Dinner
Lamb Chops
Seafood Platter
U.S. Tenderloin
Menu
C.M.
CM
Category
MM %
Category
Menu
ClassItem S.P. Item C.M.
Menu
Costs
Menu
RevenueMenu Item Name
No. Sold
(MM)
Menu
Mix %
Item Food
Cost
MENU ENGINEERING WORKSHEET
Restaurant: Mama Neomi's Café
Meal Period: Dinner
Average Contirbution Margin = 3493.8 / 1000 = $ 3.4938
Expected Popularity of Individual Menu Items = 100%/ 4 = 25%
Hence Each Item should ideally sell = (70%of 25%) of 1000 = 175 Units
Totals
Defining Popularity
Defining Profitability
Computing Average Contribution Margin = Total Contribution Margin / Total No. of Menu Items SoldAftab Umrani F&B Training Manager

IMPROVING THE MENU
Carrying out the Menu Engineering Exercise
is only useful if the information obtained
from it is used to improve the Menu.
WHAT WOULD YOU DO WITH
THIS INFORMATION???

IMPROVING THE MENU
 Managing the Plow Horses:
 (High Popularity / Low Profitability):
o Guests like these items, however, they do not
Contribute much to your Profit Requirements
(Low Contribution Margin).
a) Increase the Prices:
i. The item is Popular as it may represent great
value to the guest. Upon increasing the Price,
the item may still remain popular due to it’s
uniqueness to your property and will hence
contribute a higher C.M.Aftab Umrani F&B Training Manager

IMPROVING THE MENU
ii. Relocate the item to a lower profile of the
menu. Since, it is popular, some guests
will search it out and other will then
concentrate on a more desirable areas of
the Menu where we could position more
Profitable Items.
iii. Shift Demand to more more Profitable
Menu Items by Suggestive Selling.
iv. Provide lower cost meal accompaniments,
in this way the C.M. of the Menu Item
would increase.Aftab Umrani F&B Training Manager

IMPROVING THE MENU
v. Assess the Direct Labor Cost involved.
vi. Consider Portion Reduction. By reducing
the quantity of the food served, the Food
Cost of the Item may be reduced
increasing the C.M.

IMPROVING THE MENU
 Managing Puzzles:
 (High Profitability and Low Popularity
Items)
a) In this case the challenge is to increase the
Unit Sales of this menu item.
i. Shift demand to these items: Techniques are re-
positioning on the menu, Suggestive Selling,
Advertising (Table Talkers / Menu Boards /
Promotions etc.)
ii. Reducing the Price: By reducing the price such
that the C.M. of the item still remains higher than
the average, the Value to Guests might be
increased Aftab Umrani F&B Training Manager

IMPROVING THE MENU
iii. Add Value to the Item:
Offering a larger Portion size, more
accompaniments, better quality
ingredients and garnish may all add
value to the item. These steps will
decrease your C.M. and hence Profits,
but maintain it so that it is still greater
than average.

IMPROVING THE MENU
 Managing Stars:
 (High Profitability and High Popularity)
i. Maintain rigid specification. To not try to
alter the quality of product.
ii. Place in a highly visible / desirable area of
the menu. Make sure that guests are
aware of it.
iii. Test for Price In-elasticity. The item may
be Popular with a guest because it
represent Value for Money or because it is
unique to your operation only.
iv. Suggestive SellingAftab Umrani F&B Training Manager

IMPROVING THE MENU
 Managing Dogs:
 (Low Profitability and Low Popularity).
i. These deserve removal from the menu.
However, if you are not going to revise your
Menu Items in the near future we could at
least raise the Price of the Item so that it’s
C.M. increases.
ii. When a Dog involves significant Labor Costs,
is not Popular and Profit Oriented and does
not allow for the use of the leftovers and has a
relatively short storage life, then reasons for
removal from menu become more compelling.

COMPUTER BASED MENU MANAGEMENT
 Data can be entered into a Program’s
Database Manually.
 This can also be done automatically
through an interfaced system with a
Recipe Management Software or an
external POS System.
 The Parameters to be entered would
include:
i. Menu Item Name
ii. No. of units of the Menu Item Sold
iii. Food Cost of the Item
iv. Selling Price of the ItemAftab Umrani F&B Training Manager

COMPUTER BASED MENU MANAGEMENT
 Reports generated by the Computer
Based Menu Management Software are:
i. Menu Item Analysis
ii. Menu Mix Analysis
iii. Menu Engineering Summary
iv. Four Box Analysis
v. Menu Engineering Graph

COMPUTER BASED MENU MANAGEMENT –
Sample Menu Item Analysis Report
210 4.85 7.95
420 2.21 4.95
90 1.95 4.5
600 4.95 7.95
60 5.65 9.95
360 4.5 8.5
510 4.3 7.95
240 3.95 6.95
150 4.95 9.5
360 4 6.45
Item Name
Units
Sold
Portion
Cost
Item S.P.
Fried Shrimp
Fried Chicken
Chopped Sirloin
Prime Rib
King Prime Rib
NY Strip Steak
Top Sirloin
Red Snapper
Lobster Tail
Tenderloin Tips Aftab Umrani F&B Training Manager

Sample Menu Mix Analysis Report
.
210 4.85 7.95 7.0 1018.5 1669.5 3.10 L H HORSE
420 2.21 4.95 14.0 928.2 2079.0 2.74 L H HORSE
90 1.95 4.50 3.0 175.5 405.0 2.55 L L DOG
600 4.95 7.95 20.0 2970.0 4770.0 3.00 L H HORSE
60 5.65 9.95 2.0 339.0 597.0 4.30 H L PUZZLE
360 4.50 8.50 12.0 1620.0 3060.0 4.00 H H STAR
510 4.30 7.95 17.0 2193.0 4054.5 3.65 H H STAR
240 3.95 6.95 8.0 948.0 1668.0 3.00 L H HORSE
150 4.95 9.50 5.0 742.5 1425.0 4.55 H L PUZZLE
360 4.00 6.45 12.0 1440.0 2322.0 2.45 L H HORSE
3000 100 12374.7 22050
Menu Mix Analysis
Item Name
Units
Sold
Portion
Cost
Item S.P.
Menu
Revenue
Menu
C.M.
CM
Category
MM
Category
Item
Category
NYStrip Steak
Top Sirloin
Red Snapper
Fried Shrimp
Fried Chicken
Chopped Sirloin
Prime Rib
Remarks
Menu
Mix %
Menu
C.P.
LobsterTail
Tenderloin Tips
King Prime Rib

.
Totals Average Low High
22050 7.465 4.5 9.95
12374.7 4.131 1.95 5.65
9675.3 3.334 2.45 4.55
3000 300 60 600
56.12
10
Food Cost %
Number of Items
Particulars
Menu Engineering Summary
Price
Food Cost
Contribution Margin
Demand Factor

Four Box Analysis
.
************************************************************
HORSE
Fried Shrimp
Fried Chicken
Prime Rib
Red Snapper
Tenderloin Tips
STARS
NY Strip Steak
Top Sirloin
DOGS
Chopped Sirloin
PUZZLE
King Prime Rib
Lobster Tail

Menu Engineering Graph
Menu Engineering Graph
0
100
200
300
400
500
600
700
0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5
Contribution Margin
MenuMix
70% MM
3.34 CM

Trainer Profile
Aftab Umrani
Training Manager
Skillston Hyderabad,
Sindh, Pakistan

Restaurant Menu Mgt

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