Menu engineering
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Menu Engineering is the process of using a marketing assessment to help generate additional gross profit from a restaurant’s menu.
In its truest sense, the term menu engineering refers to the specific restaurant menu analysis methodology developed by Michael L. Kasavana, Ph.D and Donald J. Smith at the Michigan State University School of Hospitality Business in 1982.
By using guest demand (also called the menu mix) and gross profit margins, the relative performance of each menu item is determined, and assigned one of the following terms:
Stars
Stars are extremely popular and have a high contribution margin. Ideally Stars should be your flagship or signature menu item
Plow Horse
Plow Horses are high in popularity but low in contribution margin. Plow horse menu items sell well, but don’t significantly increase revenue.
Puzzles
Puzzles are generally low in popularity and higher contributions. Puzzle dishes are very difficult to sell, but are have a high profit margin.
Dogs
Dogs are low in popularity and low in contribution margin. Basically they are difficult to sell and when you do they are not all that profitable.
Several variations to this methodology have been developed at hotel and restaurant schools around the country which have had qualified results.
Over the years, the term menu engineering has become a buzzword within the industry which has come to mean “doing something/anything to improve menu performance”, slang for the generic use of the term. As a result, the understanding of the whole process has become less clearly defined.
In the hands of a skilled practitioner, menu engineering can be a powerful tool which points out a wide range of strategies and tactics which can lead to large increases in the profitability of restaurant menus.
