Assess Risks! Get Rid of Old Menu Items before Your Restaurant Flounders
Restaurants that have been open for some time such as at least one year should analyze their menu items to make changes as appropriate to their situations. Many restaurants overlook this issue, so their menu items stay the same from opening day to the present. Consequently, they lose opportunities for generating profit and might be increasing costs without realizing it. So, how do you make changes in your own menu items? We’ve got some suggestions to offer you:
In running a restaurant, menu items require the primary attention of entrepreneurs, because menu items generate income for the restaurant. Every year, an analysis should be conducted on the existing food costs relative to any changes in ingredient prices for the entire year in order to determine the actual cost of each plate of food sold at the restaurant. This topic is often overlooked by SME restaurateurs. But don’t forget that most ingredient costs fluctuate throughout the year and are more likely to go up than down. As a result, it is likely that the food cost per plate will be higher. With higher costs, profit per plate will decrease. This is why restaurants should change their menu items periodically.
In changing menu items, in addition to knowing food costs, you have to find out which menu items sell well and which items sell poorly. You need to analyze these two categories in order to plan menu changes for greater profit. This is because good-selling menu items may not always remain very profitable and many items that sell well might in fact be totally unprofitable.
What should you consider when eliminating menu items?
If a restaurant uses a POS (point-of-sale) device, it will be very easy for that restaurant to analyze its menu items. Just get the sales statistics from the device for analysis. You will then know which menu items are selling well and which items are not. However, if the restaurant does not use a POS device, then use menu order bills for analysis, even though this information might not be entirely accurate as bills might go missing. In any case, analyze information between menu items that sell well and menu items that do not to identify the best-selling and profitable menu items. Then make considerations based on ingredient costs in doing so. Keep the profitable menu items, and for those menu items that do not sell well or that are unprofitable or only ordered occasionally at no more than five plates per month, particularly if the menu items require very specific ingredients, consider quickly doing away with these menu items. Once you eliminate them, it will be easier for you to manage your stock, and your costs will decrease. Don’t forget that ordering ingredients for poor-selling menu items, in addition to increasing your costs, also wastes storage space and creates risks related to quality such as spoilage and loss of quality. Moreover, for menu items that are only sold once in a long time, the chances of deviating from recipes or producing appearances that are different from the recipes will also be high, as employees might forget the recipes.
Eliminate menu items that don’t sell well, that need specific ingredients and that cannot share ingredients with other menu items.
One thing you can’t forget about is the number of menu items in your restaurant. If your restaurant already has few menu items and there are more low-sale menu items than high-sale menu items, eliminating menu items might leave you with few menu items. Therefore, you have to also consider the number of menu items you have in your restaurant. You should eliminate only high-cost and unprofitable menu items that do not sell well but that use specific ingredients or have extensive preparation processes that involve many steps or require a lot of preparation time.
If you eliminate old menu items, you need to find new menu items to replace them.
Once you eliminate menu items, what you need to do next is invent new menu items to replace what you’ve eliminated. Otherwise, your restaurant will be offering the same old menu items, which leads to fewer opportunities for increasing revenue. Try creating new menu items to replace them. First check out which menu items sell well at the restaurant and learn their flavors and ingredients to find out what customers like. Take those flavors and ingredients to create new recipes, possibly with the addition of new ingredients, decorations or more interesting presentation, etc. However, do so while making sure to keep your preparations simple and fast while keeping cost low and profits high.
A lot of restaurants cherish their menu items and do not want to eliminate them. Sometimes that is because they are traditional menu items or they are menu items that the entrepreneurs themselves like, but they forget about whether or not these menu items are creating burdens or profits. When SME restaurants have a lot of menu items, a big problem that often occurs is that many menu items use very specific ingredients and require very different preparation methods. These processes are wasteful and not worth the time and accumulated cost. Moreover, they are not generating profits, and the act of offering lots of menu items makes it difficult for customers to make their decisions, making employees wait a long time as they take orders.
