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home | How to use your menu to market your . . .

How to use your menu to market your restaurant

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You have to have a menu. Why not make it your #1 salesperson?

How to use your menu to market your restaurant

How to Make Your Menu Your Top Salesperson

Imagine you're a salesperson who boards an elevator with an important customer. He turns to you and says, "I'm thinking of purchasing products from your entire line, but I want you to sell me before we get off this elevator. Tell me what makes your products special, why your pricing is reasonable, which products are best suited for me, and the quality of your service."

Where do you start? Talk about pressure! That's a lot of information to analyze and present in a few minutes. You're sizing up the customer's needs. You're running numbers in your head to determine the profitability of each product and the optimal pricing. You want to use language that entices a sale. Your restaurant's menu shares a lot in common with that salesperson.

The average guest spends only about three to four minutes with the menu, so it is important that your menu make a good first impression and directs him to the item you want purchased. This is true, whether you've been in business for a day or for a decade, but it is especially critical for the startup.

If you consider your menu simply a decorative price list, you're grossly underestimating its value. A menu is your most powerful merchandising tool. Everything that makes your restaurant special and profitable flows from the pages of your menu  your atmosphere, concept, pricing and cost-control strategy, and service ethic. Couple an effective menu with a well-trained service staff that interacts effectively with guests and you've got a winning combination. . . . menu engineering is an eye-opening experience, in that many restaurateurs simply have not looked at their menus in this light, and quite frankly, are leaving money on the table. -- Banger Smith

Menu Engineering is Not That Complex, but it's a Discipline All the Same

The techniques of menu engineering are not overly complex, as business analytical techniques go. Nevertheless, it is an eye-opening experience, in that many restaurateurs simply have not looked at their menus in this light, and quite frankly, are leaving money on the table. Menu engineering is a discipline, which is probably best led by a consultant, until the operator understands how to approach it. Once applied consistently in the restaurant, though, menu engineering can reap immediate increases in sales and, more importantly, profitability.

In the space of a magazine article, it is impossible to fully teach all the techniques and illustrate every restaurant scenario of menu engineering. But by the end of this article, you should have an appreciation for the importance of menu engineering and what it can do for your business. Through a simple illustration, we'll also show you how it can be applied.

Engineering Your Menu from the Bottom Line Up

Menu engineering is the art and science of how and where to place items on the menu. Where items are placed on the menu can dramatically affect your bottom line. Forget the big financial picture for a moment. Customer to customer, day to day, your business is measured in dimes, nickels and pennies. Ask yourself, what is one penny worth? If you answer "one-hundredth of a dollar," you're looking at it from the wrong end of the microscope. If your restaurant has annual sales of $1.5 million, and you can increase your sales one cent for every dollar spent in your establishment, those pennies are worth $15,000.

One of the first steps in menu engineering is analyzing the mix and gross profit of your menu items. The chart and graph below provide simple but effective illustrations of this process, and how illuminating it can be.

For simplicity, we examine a single category on a menu  burgers  during a given period, let's say a month. It is imperative that you keep careful track of item sales and food costs. We could devote entire articles to tracking this information, but for now let's just accept that it's important, and provides you with a powerful and invaluable analytical tool.

In this burger scenario, our data tells us what percentage of sales were attributed to each burger type (i.e., the "mix") and, second, our gross profit on the sale of each item (i.e., "gross profit contribution"). Turn your attention to the chart "Burgers by the Numbers" (below). Here, we see that your most popular item in this category was the Texas burger, and the least popular was the Big D burger. You can see that the average popularity for all items in the burger category was 9.09 percent and average gross profit was $5.60.

But the story doesn't unfold until you plot the information on the graph "The Burger Landscape" (below) using a popular desktop computer spreadsheet program.

Burgers by the Numbers Category by Mix and Gross Profit Contribution

Type Sales Mix Gross Profit Texas 23.38% $ 5.30 Cajun 9.94% $ 5.20 Mushroom 6.31% $ 5.50 Gorgonzola 4.42% $ 5.40 Bacon Cheddar 18.14% $ 6.10 Patty Melt 6.09% $ 6.00 Black Jack 15.82% $ 7.20 Stadium 8.62% $ 6.90 Roma 3.67% $ 6.30 Big D 3.60% $ 7.70 Average 9.09% $ 5.60

Aha! Now we can see our burger landscape in more detail, and see where all the items fall in relationship to the "average," both in terms of popularity and profitability. As noted, the Texas burger is the most popular item, but is below average in profitability. Wouldn't it be great if we could sell as many or nearly as many of them and increase the profitability? The Bacon Cheddar and Black Jack exceed the average in popularity and profitability. Still, you would love to boost their sales, without having to increase their cost or cut their prices, at least significantly.

Now that we see "the trees for the forest," do we detect any "dead wood" in this category? Well, you're not selling many of the huge Big D burgers, but you might need to keep this on the menu to please big eaters, and to make the other burgers look like a good value. Remember that menu engineering is an art, and like all art, requires experience and judgment to make the best calls.

The Mushroom and Gorgonzola burgers are below average in popularity and profitability. The Roma burger uses Roma tomatoes that are not used in any other item on the menu, which boosts the inventory cost of this burger. Plus, tomatoes are a relatively perishable item, which could contribute to wasted inventory costs. You need to search your soul to determine whether these low performers (a.k.a. "Dogs") deserve "real estate" on your menu.

The other question you need to answer is how to transform average or good performers into your "Superstars." You increase the popularity of an item by increasing its perceived value. Sometimes, but not always, this means lowering the price, or just giving it a sexier name. You can also give it better placement on the menu (more about this later). You increase profitability of an item by reducing its cost, or by increasing its price.

Pricing is perhaps the most complex aspect of menu engineering. Here's one caveat: Always change prices in small increments, unless it is clear that the item is grossly undervalued or overvalued (this situation should not happen if you are astute to your competition, and are allowing for sufficient profit margin from the get-go).

If you studied microeconomics in school you remember the economic term "price elasticity of demand," which, among other things, helps us understand how much you can increase the price of an item until people stop buying it and purchase a "substitute" product or service, or go without. As common sense would tell you, for nearly all products, the quantity sold will decrease as the price is increased; however, some products are less elastic (or price-sensitive) than others. Most restaurant items are relatively "inelastic," i.e. there is a narrow price range that people will pay for any given item. Even slight price increases will cause significant drop in the quantity sold. If you stray outside this range, the consumer will purchase a substitute (order the taco salad rather than the burger), patronize your competitor, or eat at home.

To make a plain hamburger a more elastic item, we need to add value, i.e. a sexier name, an interesting sauce, a better advertising campaign, or a special concept or theme. By serving the same burger with ham and pineapple on top and naming it after a rock star, you might be able to increase its price with minimal "erosion" (decrease) of sales. And in fact, in some cases it might be worthwhile to increase prices, and risk some "erosion" of sales, as long as the total profit increases. But you need to do so incrementally. Again, think pennies.

Without belaboring the subject further, I suppose you could hire a marketing consulting firm to find your optimal price points. Or you can be cautious and methodical in making price adjustments. That means listening to your guests and servers, tracking the sales mix and profitability, and employing common sense and experience.

Hopefully, you can see the variables involved, and the decisions to be made. The bottom line: By adjusting certain variables (cost, pricing, menu placement, presentation, and promotion) you can start gaining pennies (and nickels, dimes and quarters) on each item. It adds up.

This is the foundation of menu engineering. If football is a game of inches, creating a winning menu and succeeding in the restaurant business, is a game of cents.

Menu Categories by Performance

Keeping in mind the above burger illustration, you will find four basic categories into which every menu item will fall. If you are a brand-new startup restaurateur, you may be developing a menu from scratch, and you might have to use a certain amount of "gut instinct" and "what if" scenarios. Soon you will have enough experience and data to make educated decisions about menu changes using menu-engineering techniques.

The first category includes menu items that have a high gross profit contribution and high product mix. These items have maximum menu power, and depending upon your menu, these items should command the best real estate on the menu. The more we can influence the mix toward these items, the more profitable the operation will be. The bacon cheddar burger in our earlier analysis arguably falls in this category.

These items should receive the best placement on the menu and the most sales emphasis by your servers. Be careful about making significant changes to these items, in presentation or price, based on the "if it ain't broke, don't fix it" rule. If possible, try to find ways to reduce the food cost of these items, to increase your profit margin.

The second category includes menu items that sell well (high in product mix) but have less-than-average gross profit contribution. These items are often loss leaders but you've got to have them. The Texas burger is an example of this category. Typically, these items are very price-sensitive; thus, you might find that even small price increases could reduce the sales volume. Again, finding ways to reduce the cost of these items could push them closer to "star" status.

Third, we have menu items that have greater-than-average gross profit, but lower-than-average popularity. Sometimes, these items act as "image makers" and provide a largely psychological benefit to the guest. Typically, these are the more expensive items on the menu. Too many of these items can have a negative effect on the menu and they should be candidates for elimination, repackaging, repricing or replacement. Think of the Big D burger, which is so large you eat it with a knife and fork, but few people order it.

In this case, you might want to lower the price incrementally, to gauge its price sensitivity. If you can build significant sales volume, and maintain a healthy profit margin, you might find yourself with a winner.

In any situation in which you try to build popularity and/or profit, carefully track the sales of items that are already good to top performers. You need to look for signs of "cannibalization," i.e., the reformulated product is "eating" sales away from one or more existing high performers. This is not necessarily a bad thing, if the net effect is a greater combined profit; however, you want to avoid a situation in which your customers are switching to an item with a lower profit margin.

Finally, are there menu items that have lower-than-average popularity and produce a lower-than-average contribution to gross profit? These items are also candidates for elimination, repackaging, repricing or replacing. If you choose to keep an item in this category, you should know the reason. Often, these items are important to a particular market segment (like kids meals) and should stay on the menu to help you remain competitive.

You need to consider replacing or eliminating these items, unless you have a compelling reason to keep them, as discussed below.

Bigger Isn't Always Better

When you stroll down the aisles of a typical supermarket or watch television for more than a few minutes, you are slammed with the seemingly infinite choices of food available to the U.S. consumer. That's why it's tempting to offer a supermarket of choices on your menu. Slow down. The number of menu items on the menu is critical to cost and quality control. Vary it enough to interest the guest, but limit choices to maintain control.

Many restaurateurs make the mistake of trying to be all things to all people. On any given menu, 50 percent of the menu offerings typically produce 70 percent to 80 percent of the popularity. Theoretically, that means you might be able to dump half your items and still maintain 80 percent of your sales. Now in practice, some of those less popular items are necessary to carry your concept, please your spouse, and/or cater to smaller, but important customer groups (e.g. children, vegetarians, folks on low-fat diets). The important thing is to understand the trade-offs, and have a strategic reason for every item on your menu, not just to take up space.

Establish early what you do well, and what you want to be known for, and then do it. Size of the menu will depend upon the concept, market, operational capabilities, as well as quality and profit goals. A general rule of thumb: the more items on the menu, the higher the food cost. If, in your circumstances, you feel the need for an "extensive" menu, then make sure you design the menu with a limited inventory, and have strong "cross-utilization," or use the same ingredients across several menu items.

In the February 2004 issue, we discussed the term "speed scratch" products. These are pre-made ingredients that are nearly ready to serve, other than final, but often signature, touches. For example, you may have several variations for duck that are based on marinated breasts. By purchasing "speed scratch" pre-made duck breasts, you can create signature items with sauces and seasonings, and offer several variations on the menu, without a significant increase in inventory.

Choose Your Categories Carefully

How you categorize your menu can affect how the guest perceives value and variety. Most restaurants address the value and variety problem by adding items to the menu, but this can lead to higher food costs, lower gross profits, higher labor costs, wasted inventory and a diluted concept and image.

As it sounds, categorization is simply the process of subdividing the menu into smaller, more specific categories. Done well, a properly categorized menu creates a perception of variety. It also can help certain diners find what they want sooner. As you have probably noticed, men do not take as long as women to decide what they want to order. Women tend to read menus, while men tend to scan. Categorization makes either reading style more effective at bringing items to the guest's attention.

For all diners, categorization shortens the order decision time. A "postcard style" is the quickest format to read. Essentially, you break up the menu in postcard-sized spaces, for each category. Instead of being overwhelmed by a running list of menu items, the guest can compartmentalize the decision by turning his or her attention to each "postcard." Categorizing helps guests find what they want; leading to a quicker decision and ultimately a quicker table turn.

Categorization is a way to merchandize items that you want to sell. With desktop publishing software and affordable instant printing, you can reinvent your menus on a regular basis to promote certain items, driven by inventory levels and profitability.

It is critical that you identify all categories on the menu. Place a minimum of three to four categories, with a maximum of six items within a category. Any less and you lose variety/value in the category (and on the menu)  any more and the guests have to read too much. Place high-profit categories in the prime merchandising areas on the menu  the top right-hand portion of the column or postcard. This is the first place our eyes are drawn to when looking at a page.

Menu Economics

As noted, one of the most important and vital steps in preparing your new menu is "menu costing." Every menu item on the menu should have a "recipe cost." This is the foundation of menu development, and ultimately, your profitability. This will also be a key factor in determining your overall pricing strategy. It is important to note that menu item costing is an ongoing process that should be performed at least quarterly. The old adage "fail to plan, plan to fail" comes to mind here. Unfortunately, the majority of restaurants that I come into contact with do not have accurate and up-to-date food costing of their menu, limiting their profit potential and viability. Without menu costing, we could not have accomplished our above analysis of hamburgers.

Look at the chart "Gross Profit Principle of Pricing". It provides an illustration of the simple but effective way to analyze cost and profitability. Which of these items would you most like to sell? The 9-ounce filet reaps the highest profit contribution, and is the item you want to do the best job promoting and placing on the menu.

Steaks Food Cost Selling Price Food Cost % Gross Profit Sirloin $ 2.90 $ 12.99 22.3% $ 10.09 Sirloin 12 oz. $ 4.76 $ 15.99 29.8% $ 11.23 Filet 9 oz. $ 8.29 $ 20.89 39.7% $ 12.60

Develop a Pricing Strategy

Again, entire books have been devoted to the subject of pricing. There are a number of different methods (strategies) to pricing. In a future issue, we'll cover pricing in more detail. For now, what is important is that you have a pricing strategy.

Among the factors that must be taken into account when pricing your menu is concept, food cost, gross profit, the market, location, economic climate, personnel (kitchen and front of the house), competition (direct and indirect) and value (as perceived by the guest.) Focus on the following: Menu item value is critical, and one that is sometimes hard to define, since there are many factors that lead to value. Don't be afraid to ask guests and employees alike what they would pay (or sell) for a particular menu item. Not long ago, a fast-food restaurant introduced a "$6 burger," which they sold for less than $4. This is a blunt but effective illustration of what you are trying to achieve in creating the perception of value.

Groom Your Top Salesperson to be Your Smartest and Hardest Worker

Track and analyze your sales and profitability. Get to know your market and customer base. Treat the pricing, promotion, and placement of every item on your menu as if your business depends on it, because it does.

Just don't consider it a grind. Consider it a way to get control of your sales and bottom line. Consider it grooming your top salesperson  your menu.


Sharpen Your Menu IQ by Jim Laube

Everyone knows that the menu is an important part of any restaurant. But many operators either dont realize or underestimate the profound impact the menu has on their profitability. As a result, many of them pay a steep price on their bottom line. Heres a collection of menu practices that can either hurt or enhance the profit-making potential of your menu.

Menu Donts 

Dont use plastic laminated menus. Theyre expensive and will probably keep you from making necessary menu changes on a regular basis. Plastic covers with the appropriate paper inserts can give you the look you want and more flexibility in terms of being able to change your menu quickly and inexpensively.

Dont place items within a menu section in any type of order. When your menu items are shown vertically, one below the other, make sure the ones you want to sell most are shown first and last. Numerous surveys have show that items in the top and bottom positions are typically the biggest sellers, while the ones in the middle tend to get overlooked and selected less often.

Dont overlook the kids. For families with kids, the kids menu is a big deal. You must have an effective game plan for addressing the wants and needs of children if you want to attract families with kids. Numerous consumer surveys tell us that children today play a major role in deciding where the family eats. With kids, anything you can do to make the food fun and involve them will be noticed and appreciated. One restaurant I know, does something very effective with their kids cheese pizza. They bring the dough, pasta, cheese and pepperoni to the table so the kids get to make their own pizza. Very popular with the kids and parents.

Dont do across the board price changes. When you increase prices on a large number of items at one time there is a greater potential for customers to notice and become annoyed. Instead perform surgical price increases on a few items at a time. Consider changing prices more frequently, at least 2 or 3 times a year.

Dont end your price points with 0s or 5s. Every price point on your menu should end in a 9. If your price points currently end in 5s, multiply the number of items you sell annually by 4 cents and thats the impact this simple little change could have on your annual net income.

Dont price your menu items solely on an items food cost. Take into consideration your local market prices by examining your competitors price points for similar items. Be sure to take quality and portion sizes differences into account. Base your pricing decisions on an items food cost and local market prices.

Menu Dos 

Calculate the raw food cost of every item you sell. This makes it easy to calculate every items gross profit margin. In each section of the menu rank your menu offerings by profit margin. Use your menu to promote those high gross profit margin items in each section of the menu as long as they are also good, quality products that your customers will love.

Make your menus easy to read. Use typeface of 12 points or larger and use font styles that are easy to read like Arial, Helvetica or Times New Roman. As the average age of our population increases, more of your customers may have trouble reading small, hard to read typeface.

Use graphics to attract attention to those items you really want to sell. With the use of graphic symbols and effects like boxes, shaded backgrounds and signature icons, you can force your guests eyeballs anywhere you want. Its a fact that menu items that get noticed more, get selected more.

Clone your winners. Youre bound to have items that are both popular and profitable, so why not come up with another dish like it. For example, the Parmesan taste profile. If your veal parmesan is working, what else can you parm? Why not parm the chicken? Chicken tastes great and is a lot cheaper than veal. If the chicken works, why not try eggplant parm? (the all-time food cost champ) Cloning your winners can be a very successful strategy because you already know what the customer likes. Remember though, only consider cloning your winners, those items that are both popular and profitable.

Check out other restaurants menus. In particular look at what the large chains are doing in terms of design, font, graphics, colors and price points. Not that you want to copy what theyre doing, but most of the players in this crowd understand what the menu means to their profitability and pay big bucks to have every element analyzed in detail. Put your own spin on some of their good ideas.

Consider printing your own menus or menu inserts. With the advent of laser and inexpensive color printers many restaurants are printing their own menus in-house. This means changing the menu can be done quickly at minimal expense. There are several software programs available specifically for menus which include all types of templates, clip art and more. And many paper companies offer pre-designed menu insert paper in a variety of designs, colors, sizes and paper stock.

Tell your quality story. Chances are pretty good that you go to a lot more trouble preparing your food than your customers give you credit for. That may be partially your fault for not telling them. If you make your own dough, or prepare your sauces from scratch, use your menu to tell them. The back cover can be an excellent place to tell your guests all the little things you do and the special, high quality ingredients you use. Not everyone will take note but some will and it may play a role in where they decide to go the next time they eat out.

The menu is one of the most important critical success factors in any restaurant. The menu is the only marketing piece that every one of your customers will read and it will have a direct bearing on what each of your customers decides to buy. Successfully integrating one or more of these ideas should go a long way toward making your menu a more effective marketing and profit-building tool.

============ The Psychology of Menu Design: Reinvent Your 'Silent Salesperson' to Increase Check Averages and Guest Loyalty By Dave Pavesic

The menu is the most important internal marketing and sales tool a restaurant has to market its food and beverage to customers. It is the only piece of printed advertising that you are virtually 100 percent sure will be read by the guest. Once placed in the guest's hand, it can directly influence not only what they will order, but ultimately how much they will spend. Menu design directly influences sales revenue. Management is constantly forecasting business volume to estimate how much to buy, keep in inventory, and prepare. A properly designed menu makes these kinds of decisions easier and more accurate.

A well-designed menu can educate and entertain the customer as well as be a communication, cost control, and marketing tool for your restaurant. The menu is designed to help the guest decide what to order. When you strategically place menu items on the menu, you will sell more of them than if you placed them randomly.

Well-designed menus market the food the restaurant prepares best and wants to sell by making those items stand out from the others. This article will discuss menu design techniques to help you increase the effectiveness of your "silent salesperson" to boost check averages and guest loyalty.

Your Restaurant's Business Card

The menu design must be congruent with the concept and image of the restaurant and effectively communicate the overall dining experience to the guest. Think of your menu as your restaurant business card. It introduces the customer to your restaurant, and its design should complement the décor, service, food quality, and price range of the restaurant. The menu design should incorporate the colors and graphics that the customer sees from the table. A properly designed menu can help any restaurant  whether it be a fine-dining, casual-theme, fast-casual concept, or fast-food  achieve its sales goals, keep its costs in line, increase its speed of preparation and service, and return a desired average check. This does not happen by accident; it must be planned during the design of the menu or menu boards.

Too often menus are not given the time and budget that such an important marketing tool deserves. Many of the popular and high-volume dinner houses have menus that if their logo and name were removed, the image created in your mind from the menu would be severely understated to the extent that you might not even consider going there to eat. One of the services provided to out-of-town visitors by hotel concierges is making recommendations and reservations at local restaurants. They often display menus for the benefit of visitors, who make dining decisions solely on the basis of the menu. . . . Customers spend an average of 109 seconds reading a menu.

The same care, time and effort should be given to the task of menu design and production as is given to the design and décor of the dining room and kitchen. The menu content is the product of the chef and owner who have in many instances spared no expense in the dining room décor and the kitchen equipment. They are highly respected professionals in the restaurant community and yet their menu design gives the impression that they ran out of money or that the menu design was just an afterthought. Considering how much the restaurant depends on the menu, it is astonishing that many menus do not reflect the level of professionalism and knowledge of the owners, chefs and managers.

More and more restaurant companies have come to realize and understand the importance of proper menu design on check averages. Several years ago, Houlihan's revamped its menu with the goal of increasing check averages. The menu was designed to lead the customer from the specialty drinks on the cover to appetizers on the first page to the complete dinners inside. Its old menu, by contrast, lumped all types of items next to one another on the same large fold-out page. This, it was felt, might have somewhat deflected dinner sales by making it easy for the customer to select only an appetizer.

Menu Psychology

An article in The Wall Street Journal told of restaurants that designed their menus to highlight the most profitable offerings. These menu items were also hyped by servers when asked to recommend a dish by a guest. Techniques such as highlighting items have been used for years in the retail sector. Their store window, counter, and mannequin displays have been used to promote clothing and merchandise. They found that if a customer notices the merchandise it greatly increases the likelihood that they will make a purchase. If they never noticed the merchandise, there is zero possibility of purchase. Adapting this merchandizing theory to menu design, restaurant operators can boost sales of high-profit/low-cost items by highlighting them on their menus. This is called "menu design psychology" or "menu psychology." What we are essentially saying is that the design of the menu can have a subtle effect on what customers will eventually order. The menu is to a restaurant what the merchandise display is to a major department store. You want the customer to see all the things you have for sale in the hope that they see something they like and ultimately make a purchase.

The concept of menu psychology was introduced to the industry in the writings of the late Albin Seaberg, in his book, "Menu Design," published in 1971. He pointed out the importance of designing a menu in such a way that you get the customer's attention and raise the odds that they will select certain items more than others. Too often the menu design was left to the printer or graphics specialist without any input from the restaurant manager. Knowledge of these "menu psychology" techniques will greatly improve the design of any menu.

109 Seconds and Counting

Several years ago, Gallup reported that most customers will spend an average of 109 seconds reading a menu. This is the time limit you have to get your message to them. The time it takes to read a menu and make a decision needs to be addressed in your menu design and presentation.

Over the years, restaurants like Bennigan's, TGI Friday's, and The Cheesecake Factory have been known for their multipaged menus and extensive listings of menu items. If it takes longer to make a purchase decision, it will lengthen your table turnover times, especially with first-time guests. With the information on menu item sales being quickly and easily assembled through point-of-sale computers, the number of selections and pages have been greatly reduced because they found that 60 percent to 70 percent of their sales came from fewer than 18-24 menu items. It did not make sense to have 50-100 different choices. Not only did they shorten the order-taking time, they reduced inventory and purchases.

Considering the importance of the menu sales mix in the smooth and efficient operation of the restaurant, it behooves all restaurant operators to learn the various techniques of menu design so they can be incorporated into their next menu design. A properly designed menu can direct the attention of the diner to specific items and increase the likelihood that those items will be ordered. These items should be the ones with the highest gross profit, lowest food costs and help achieve the average check needed to return the desired sales. In addition, degree of preparation difficulty should be factored into your menu evaluation. If an item cannot be prepared in 10-12 minutes or it requires multiple steps and needs to be moved between more than two stations or employees before it gets to the pickup window, it may not be one of the items you want to prominently display on your menu. This being said, while menu design and placement of items on the menu can influence the customers' decision, it will not influence customers to purchase items that they do not want. Menu design can help increase the odds of an item's selection.

Think how much easier it would be to forecast use levels of perishable ingredients, production quantities, and scheduling help when you can forecast to within 1 percent to 3 percent of what you will be selling during any given meal period. If you can predict the number of customers that will enter your restaurant, you can quantify your needs for inventory, production and staffing.

Don't Leave Guest Preference to Chance

The following statement may at first sound contradictory to what has been stated, but here goes: Any menu, any design, and any format will produce a predictable sales mix if put in service every day for a prolonged period. In other words, regardless of the menu design, the popularity of particular menu items will evolve so management will be able to forecast customer preferences and thereby be able to plan purchases and preparation quantities according to the existing sales pattern. Here is the key point we want to make: If such a sales pattern will occur without any rhyme or reason to the design of the menu, think of the possibilities if the menu were designed to promote the items the restaurant wanted to sell more than any other. Instead of leaving it entirely to a random selection, you can actually "direct" the customers' attention to those items you want to sell and are geared up to sell.

How do you turn your menu into a cost control, marketing and communication tool? There are certain "practices" that when incorporated into the graphic design and layout of a menu can actually "influence" the menu selections of the guests. These practices and techniques are not subliminal and do not in any way force or trick the customer into ordering something they do not want any more than looking at a television commercial or newspaper advertisement influences the purchase decision. However, like a television commercial or newspaper advertisement, menu design can put an idea into the head of the consumer, thereby increasing the likelihood that they will at least consider the choice when a purchase is made. If they never saw the ad it would never had occurred to them to even consider its purchase.

The Power of Print

The techniques of menu psychology are most applicable to the printed menu. (However, there are others that can be employed with verbal menus, i.e., menus delivered orally by the server. In some restaurants, this might just include specials. In very upscale establishments, this might include the entire menu. But this article is devoted to only the printed menu.) What are the techniques employed in the design and production of a menu? Some of the techniques involve such elements as the print style and size, the paper and ink color, the texture and finish of the paper, graphic design, art work and illustrations. Even the placement of items on a page or with a list is done for specific reasons. Actually, menu psychology techniques can be anything that is used to direct the reader's attention to certain parts of the menu to increase the likelihood that those items will be remembered. If they are noticed and remembered, they are more likely to be ordered than an unnoticed or forgotten item.

In a study by a hospitality management student at Florida State University of a Bennigan's menu from the early '80s, more than three-fourths of all menu items sold were either snacks or appetizers. The menu at the time contained 14 pages and the dinner entrees were listed on the last two pages. The customers didn't bother to read past the first four or five pages and the menu length and design was significantly contributing to the poor sales of dinner entrees in the overall menu sales mix.

You can improve your sales without changing any menu item or price. All you have to do is reposition the items and employ menu psychology techniques on your menu. There are several different menu formats and each has a different area of sales concentration. The items you put in the area of sales concentration should be selected with care and purpose. They should be items that you want to feature and do better than the competition. This is where you want to list your house specialties and signature items.

A way to direct a guests attention to a

certain part of the menu is to confine

the elements with a border or graphic.

In addition to the format, the menu items are typically grouped into menu categories. The number of and names used for the various menu categories will be greatly influenced by the type of restaurant, the price range, and number of menu offerings. For example, the typical categories for a restaurant featuring steak will be different from that featuring seafood or ethnic cuisine, such as Italian or Mexican. The industry standard is to put menu items into categories and in the order in which the items are typically eaten. Restaurants with higher check averages typically have more menu categories than those with lower check averages.


There are three basic types of menu page and fold formats you can use on a menu. First is the single-page format in which the entire menu is contained on a single page or card. The area of sales concentration is in the top half of the page. Then there is the most common format of the two-page/single-fold menus. Menu size and shape will vary considerably. The National Restaurant Association conducts a menu contest every year during its annual convention in Chicago and has found that the most common sized menu was 9 inches by 12 inches. This is the result of no other reason than to accommodate the standard paper size of 8.5 inches by 11 inches.

The graphic "Eye Movement Pattern" (see picture below) shows the typical eye movement over a three-panel, two-fold menu. The pattern of eye movement is not fixed and can be altered and directed by "eye magnets." Eye magnets are little graphic techniques that will attract the eye and guest's attention. Some of the best examples are graphic boxes around menu items, the use of a dot matrix screen of color as a background, using a larger or bolder type font, incorporating an illustration or even a photograph to "draw" the eye. The areas of emphasis are used to list the items you want to promote the most.

Gaze motion patterns will vary according to the page format, graphics, layout and number of folds in the menu. There is a tendency to list items in the order in which they are consumed. This puts cocktails and appetizers first and desserts and dessert beverages last. The greatest amount of space on the menu is given to entrees, which are the highest-priced items on the menu. In most restaurants, close to 100 percent of the customers will order an entrée but only a small percentage will order appetizers and desserts. This begs the question that perhaps we should relinquish some of that prime menu space that up to now has been reserved for entrées, and in their place put a la carte appetizers, side orders and desserts. This emphasis can only increase the likelihood of those items being selected in addition to an entrée.

Restaurants with static menus that combine both lunch and dinner items can be quite extensive. Their menus tend to be fairly large and become crowded and use a type font that's too small. A crowded menu that is difficult to read is not an effective merchandizing tool. It is recommended that if the menu approaches 12 inches by 18 inches in size that multiple menus be employed to keep the size manageable. Separate drink, wine, dessert and children's menus may be more practical and do a better merchandizing job than an oversized and crowded menu. Especially with desserts, a separate menu that is handed to the guest is a more effective sales piece than having them recall what was on the original menu or having the server describe the choices verbally. Table tents and menu boards can be used to merchandize daily specials when menu clip-ons add to the clutter and compete with the regular menu items.

Sometimes Bigger Isn't Better

In addition, oversized menus are difficult to maneuver in tight quarters. Guests have knocked over wine glasses with the menu and menus have been scorched by candles. Customers have commented that the menus were obstructing their view of their dining partner and were even too large to be placed on the table. The more extensive the listings of menu items, the larger the menu dimensions and the more space that is needed to contain the listings and descriptive copy.

If you have a three-panel menu with interchangeable pages, try swapping them at lunch and dinner for a month and check your menu sales mix for any changes. Odds are that whatever is in the center panel will sell more than if it were on the back cover. This is also a way to increase your check average at night by moving the lower-priced sandwiches and salads to the back cover where they are less likely to be noticed and therefore ordered.

Menu design psychology also uses several visual element techniques to increase the effectiveness of the menu as a marketing, communication and cost control tool. The first visual element is the font size and style. Words, numbers, or graphic symbols can be increased in size to attract the reader's eye or decreased in size to de-emphasize attention to a particular item. It follows that selectively increasing the type size and style of some menu items is a technique that will draw the customer's eye and therefore their attention. It is this attention that increases the odds that the customer will consider ordering that item more than if they had never noticed it at all.

Different styles of type fonts can be used as "eye magnets." This technique is most effective when the entire menu is limited to three different font styles. When four or more different font styles are used, the drawing power of the font becomes diluted and the eye never rests in any one area. Again, the intent is to bring attention to some menu items or areas of the menu. Improper placement or use of these techniques can be counterproductive and take attention away from the menu sections or items the operator wishes to emphasize.

The second technique is accomplished by increasing the brightness or color (shading) of visual elements to attract attention and establish a menu grouping. In printing jargon, this is referred to as dot-matrix screening. The brightness of a color can be increased, such as changing from gray to black or from a light pink to a dark red through a screen of tiny dots placed in various densities that produces a specified percentage of color. The use of color in the font, graphics, and borders can also be used to attract attention. The change from a light type to a bold type can also increase awareness and can actually direct the eye along a prescribed path. Thus, color and brightness can be used along with font size and style to direct the reader to certain parts or sections of the menu.

Another way to direct a guest's attention to a certain part or section of the printed menu can be accomplished by placing the elements in a confined area or space on the menu. The use of borders to "frame" a menu item or group of menu items is an example of this menu psychology technique. An example would be the appetizer section of a menu that is set off by a box border or graphic design. The grouping of all the appetizers within a designated area encourages reading them as a unit. Adding an extra line space (leading) between menu items and putting less space between the title or name of the menu item and its descriptive copy clearly conveys that the description is for the preceding item.

In much the same way that spacing tends to group visual information, the use of similar elements such as brightness, color, size, or shape encourages elements to be seen together. Thus, switching from regular to bold type, changing fonts, or introducing a different color of type signals to the reader that they are moving from one section to another, e.g., appetizers to salads.

While all these elements can be used to guide the customer's eye around the menu to the items that provide the best overall return, the entire menu must remain uncluttered and easy to read. If for example, appetizers are contained within a rectangular border, do not use a circle or square around another appetizer and place it adjacent to the others. A different shape suggests a different menu category, e.g., side dishes or salads.

The menu design psychology techniques described in this article are useful tools to the graphic designer in preparing a menu. In the March 2005 issue, we will discuss how the menu paper, its weight, texture, finish and color contribute to the menu design, the average check and gross profit return.

For now, the key point is to put a great deal of energy and thought into the design and psychology of your menu. Your efforts and planning will be returned many times over.

-- Restaurant Startup & Growth


Common Menu Mistakes

Inadequate management commitment. Not treating the menu design decision with the same due diligence as any major capital investment decision is setting yourself up for failure. So is leaving the menu layout and design up to your printer and not working with a graphic designer to accentuate the menu items you want to feature.

Hard to read. Examples include poor readability because of font size, paper color and font style; crowded menu pages with elements too numerous and font type too small; and printing on dark paper with dark ink making readability difficult under low-light conditions.

Overemphasizing prices. When you align prices in a column down the page, guests can summarily discount items based on price alone.

Monotonous design. Using the same graphic design on all menu items so nothing stands out says, "blah."

Poor salesmanship. Not emphasizing the items the restaurant wants to sell through graphics, fonts, color, or illustrations reduces your influence on what items will move.

Poor use of space. This includes not using the front and back cover for information about the restaurant, e.g., hours, services, history, address, etc. I have more than 1,000 menus in my library and about one-fourth of them do not have any identifying information. Over the years I have forgotten where some of them came from and the menu does not contain any information. Since people take menus from restaurants as souvenirs, it should contain what is referred to as "institutional information." To not include it would be like having custom matches without your restaurant's name on them.

Incongruent. This includes failing to design the menu to fit the décor and personality of the restaurant. Your menu is your primary communication tool and it should be designed in a way that if a customer who had never heard of your restaurant were handed a copy of your menu they would be able to visualize your décor, type of food, price range and whether you were casual or upscale dining.

Too big. The size of the menu needs to take into account the size of the table, the place setting and the table appointments. Oversized menus can be awkward to hold and handle while sipping a martini and trying to have a conversation with your dinner companions.


About the Primacy and Recency Theory

Most people do not "read" a menu from page to page. Instead, they "scan" the menu with their eyes. Therefore, if you want to feature specific menu items, they need to be placed where the eye goes first. Do not leave this to chance. The use of "eye magnets" helps direct the gaze of the reader to that particular section. The eye can be drawn by treating a particular section of the menu differently from the rest. Perhaps you put a box around your appetizers or use a larger or different color type font to make a menu description stand out from the rest.

Dot-matrix background screens can also be effective as well as using icons or symbols to the left of the menu description. They have been used to designate "Heart healthy," "low carbohydrate," or "Spicy Hot" items. However, use these techniques sparingly because it you overuse them, you diminish the ability to direct attention to specific items.

========================== Menu Format: What's Right For Your Restaurant

One of the most popular and common type of menu format is the plastic laminated format. A plastic laminated menu. It definitely has some advantages. They are durable, very easy to clean and can enhance the presentation of certain designs, colors and pictures.

Durable, But Expensive However, plastic laminated menus can be expensive. A high quality laminated menu can easily cost $5 a piece and more. The fairly significant investment required can cause operators to delay making menu changes even when its costing you money to maintain the status quo. When operators purchase laminated menus they often buy large quantities to get a better per menu price. This makes it even harder to justify a menu change when there are still 10 cases of unused menus in the storage room. As a result many operators keep using the same plastic laminated menus long after a new menu was needed.

Are there some reasons why you want to have the flexibility of being able to change your menu quickly and inexpensively? Absolutely, and well discuss many of those reasons in other menu articles.

A Better Idea A menu format that has become increasingly popular is the use of plastic covers with paper inserts. The initial investment in a high quality plastic cover can be just as much and maybe more than the cost of the plastic laminated formats, but a good plastic cover has a fairly long life expectancy. Menus with a plastic covers and paper inserts can make it easy and inexpensive to make changes.

Im familiar with several, what I would call casual, fine dining restaurants that use a fairly consistent plastic laminated format. Even though these restaurant have a fairly high check averages, they all use inserts that are black lettering on legal sized white or off-white paper. Little or no color and their menus still look good and, appear anyway, to work well for them. I suspect that using this type of menu format allows these restaurants to change their menu in 24 hours or less for not much more than around $50. Now thats flexibility.

You can find companies that specialize in menu covers on the Internet. Just go to you favorite search engine and use the key words menu covers and youll find plenty of companies to check out.


How To Win The Menu Pricing Game Dave Pavesic

Of all the business decisions a restaurateur has to make, the one that causes considerable anxiety is pricing the menu. At first blush, it seems like a numbers game. Simply fire up the business calculator or spreadsheet program and determine what you need to gross in order to reap a reasonable return on the business after all costs are figured. If pricing were only that simple.

In fact, the pricing process is more of an "art" than a "science." That does not mean that you should price your menu simply by intuition. Just because something is an art does not mean that it is not a discipline. The point is you need to understand how your guests perceive your operation. The psychology of your customer is a significant factor. This requires observation and asking questions. Consider your last visit to a flea market, antique mall, or garage sale as either a buyer or seller. You dealt with the uncertainty of pricing when you were deciding how much to charge or what you thought was an acceptable price that would motivate you to buy. At the end of the day, pricing is all about what someone else is willing to pay for your product or service. If you have ever sold a home or car, you probably found that what you thought you should receive and what you ended up taking were not the same. While most folks form an opinion of the value of an item based on experience and research, in many cases the right price is a matter of perception. You need to be aware of how customers perceive your prices, and ways that you can influence their perception.

But I Need to Cover My Costs!

It has been said that it is the buyer, not the seller, who ultimately determines the price. Customers don't care about your costs, and what margin you need to stay in business. Sure, you want to keep your costs as low as practical so that you can reap as great a return as possible. And clearly, as we will discuss, you need to know your costs. That said, banish from your vocabulary the term "cost-plus" pricing (i.e., setting all your prices based on a fixed "target" margin over your costs). It does not apply in this business.

When I gave a talk several years ago at the New York Hotel and Restaurant Show, I began with several anecdotal comments regarding what I considered extremely high menu prices for food and drink in Manhattan and at the convention center. After I finished my presentation, one of the restaurant owners in the audience came up to admonish me for being so outspoken about their prices. He said that they have higher overhead and, as a result, must charge accordingly. "Operators in the Big Apple have to cover costs and make a profit, or it wouldn't be worth the risk, investment and mental anguish of owning a restaurant," he said.

I agreed with that statement, but added that prices must be competitive and reasonable, too. If customers do not feel that they are getting sufficient value for their money, regardless of price, they will likely not return to make another purchase. Where to start? You need to create a pricing "continuum," in other words, a price spectrum, which is defined at one end by the lowest price you can charge and still make a reasonable profit and the other end, by the highest price the market will bear. Use this model for every pricing decision, since it will help define your price range. It is easier said than done, but at least will force you to take a methodical approach to pricing. More importantly, because pricing involves a measure of subjectivity, there is great value in determining your absolute boundaries.

So How Low Can You Go?

Determining the lower end of the pricing continuum requires careful consideration of all costs involved in bringing that item to the table, including the costs involved in preparing and presenting an item, or bringing customers in the door, for that matter. As we said, you cannot base your pricing solely on cost; however, you better know your actual costs before embarking on your pricing journey.

Let's review your cost centers. Your direct costs are the ingredient used in each item. It is vital to know the food cost of each item, and to manage those costs with as much certainty as possible. This includes accurate portioning and weighing of ingredients. (For more information on this subject, see "Profit from Proper Prepwork".)

While the labor to prepare an item is a significant menu cost, many restaurants treat it as an indirect cost. The time and motion studies to determine the exact labor that goes into each item are more involved than most restaurateurs are willing to wade through. Still, try to bear in mind the time and labor involved in producing a particular made-from-scratch specialty versus premade items that require minimal preparation. Common sense tells you that such "convenience" items do not require as high a markup as others requiring processing and handling, to be profitable.

Indirect costs are those that cannot be assigned to specific menu items but often involve aspects of your business that customers perceive as "value-added," and are weighted in their decision to choose your restaurant over a competitor. These include overhead, such as costs related to providing customer service and ambience, and certain amenities, such as a fancy restroom or crayons for kids. You would not allocate these overhead items to your menu pricing, but you would monitor them carefully to ensure that they are in proper proportion to your gross sales. (See "How to Evaluate Your Prime Cost," at the bottom.)

And though indirect costs are not typically allocated to specific menu items in a restaurant, they can be recouped indirectly, if they create added value that can justify higher prices. For example, if your marketing efforts (which are overhead) have helped positioned your restaurant as the most interesting and desirable place of its type in the market, you can price more aggressively than if you were just considered a ho-hum "follower." The atmosphere and decor of a restaurant adds much to the enjoyment of any meal. The perception of value is enhanced when the restaurant is beautifully and tastefully decorated. The service commitment can be the element that makes your restaurant "competitively distinctive" from your competition. This intangible is recognized as an added value by the customer and can be reflected in the prices charged.

For example, if your operation is considered the top steakhouse or Italian restaurant in your market, you will be able to charge more than the "customary" menu prices. Similarly, if your service is head and shoulders better than most of your competition, you can charge a little more than the average operation.

In other words, there are certain things that you do better than most that give you a competitive edge over your competition and you can charge a little more than your competition. Examples of other indirect cost factors that could allow you to adjust prices upward (the absence of these items would work the opposite in the pricing decision). These include ambience, location, amenities, product presentation, customer demographics, and specialty menu items. There are further adjustments that one would make to fine-tune menu prices that involve your desired check averages and the high and low price points of your various menu item categories.

The High Side

At the other end of the spectrum, you need to study your market and customer before pricing at the higher end of the pricing continuum. The tough question, and the one that can only be answered using judgment and observation, is whether you should price an item on the high or low side of the continuum. Again, apply common sense. Your gut will not always be right, but it will never intentionally mislead you, and more often than not, it will tell you if an item's price is too high. If you would not pay that price for the item, most likely your customers would feel the same way. But realize that pricing menu items can rarely be completely objective. In addition, avoid the temptation to underprice a menu item. In a business in which success and failure is often measured in pennies, underpricing can be as much of a dilemma as overpricing. You don't want to leave money on the table, anymore than you want customers grousing about your pricing, and eschewing your business for a competitor that is perceived a better value.

And it's another reason why basing your pricing on cost alone can be problematic. Take this very simple illustration. Consider a cup of beef bouillon as an example. The food cost of a 5-ounce cup would be about 10 cents. If it were priced to achieve a 40 percent food cost (a markup of 2.5 times its raw food cost) it would be underpriced at 25 cents. Since this item is usually served in white-tablecloth operations, the "customary price point" could be $3.95 and it would not be considered overpriced by patrons. In fact, one technique for boosting the profitability of your menu is to offer low-cost, but popular items. The margins can be extraordinary, and boost the profitability of the house significantly.

Again, you need to look at each item separately, and determine which price seems reasonable. Applying a single markup method or marking up each item to return the same profit will result in items being overpriced and underpriced over what the customers see as "customary" in the market. If, for example, your cost to produce a common menu item like a hamburger was twice the cost of other restaurants, your price could not be twice the price of your competition. Your cost is excessive and customers would not pay your price. You could only charge the "customary market price" for a hamburger unless you turned it into a "specialty" item. Markup is tempered by other factors besides food costs and desired profit.

More Advice on Picking the Right Point on the Pricing Continuum

While pricing is mostly art, sometimes you need to rely on a little science. For a minute, let's play economist. (Economics is called the "dismal science," so you may need to crease your forehead and frown a little at this point.) With the pricing continuum in mind, pricing can be either "market driven" or "demand driven."

Market-driven pricing is just what it sounds like  the market determines the price. If you stray even a little above what the market is willing to pay, sales plummet. What items are driven by the market? If the menu item is a "commodity" in the economic sense, that is, it is available just about everywhere and quality differences are nominal, a definite price point exists in the market and in the mind of the customer. A quarter-pound hamburger might fall under this category. There is only so much any