A Proven Step-by-Step Guide to More Profitable, Streamlined Menus
Updating your menu isn’t just a seasonal task, it’s a strategic opportunity to strengthen your brand, improve margins, and delight your guests. In this first installment of the Menu Update Handbook, we walk through the foundational steps every operator should take before making a single change. From defining your goals to assessing your current offerings, this is your playbook for starting strong and setting up a menu that performs.
Whether you update your menu once a year or several times per season, following a structured process ensures every decision drives results.
1. Set Clear Goals for Menu Changes
Strategic Goals
- Brand Positioning: Update the menu to reflect your brand identity or realign the concept.
- Market Differentiation: Introduce unique offerings that set you apart.
- Adapting to Trends: Keep selections current with emerging food trends.
- Day-Part Growth Strategies: Attract more traffic during certain times of the day (e.g., lunch specials, happy hour, etc.).
Financial Goals
- Boost Profit Margins: Prioritize high-margin items; adjust or remove low-margin dishes.
- Cost Management: Reflect seasonal or market price shifts in menu pricing.
- Drive Revenue: Use exciting new items and limited-time offer promotions to encourage repeat visits.
- Eliminate “Dogs”: Cut unprofitable or unpopular items.
Operational Goals
- Operational Efficiency: Streamline the menu to improve speed and consistency.
- Enhance Quality: Remove under-performers so the kitchen can maintain high standards.
- Elevate Output: Continuously refine recipes and prep processes.
Customer-Focused Goals
- Adapt to Preferences: Cater to evolving dietary needs (e.g., vegan, vegetarian, low-carb).
- Leverage Seasonality: Use fresh, seasonal ingredients to boost appeal.
- Act on Guest Feedback: Update based on guest suggestions and reviews.
- Build Excitement and Loyalty: Use new items to drive loyalty and word-of-mouth. (Consider aligning marketing with these updates.)
2. Conduct a Menu Assessment
Evaluate your current menu through objective analysis to determine what’s working—and what’s not. Here are the steps to conducting an assessment:
Collect Data
- Sales: Track item-level performance.
- Food Costs: Calculate costs per dish.
- Customer Feedback: Review guest comments and comp/void reports to identify items that are under-performing and more likely to be returned by the customer.
Calculate Key Metrics
- Profit Margin = Selling Price – Food Cost (measure of how much profit each item generates)
- Food Cost % = (Food Cost ÷ Selling Price) x 100 (indicates the efficiency of pricing)
- Contribution Margin = Selling Price – Variable Costs (focus on items with high contribution margins)
Utilize Menu Engineering Matrix
Classify menu items based on popularity and profitability:
- Stars (High Profit, High Popularity): Promote
- Plowhorses (Low Profit, High Popularity): Adjust pricing or portions
- Puzzles (High Profit, Low Popularity): Rework or market better
- Dogs (Low Profit, Low Popularity): Remove or redesign
Analyze Trends and Patterns
- Identify seasonal patterns and customer preferences
- Analyze links between price, portion size, and demand
- Track whether certain items boost sales of others
Make Smart, Data-Driven Decisions About Existing Menu
- Adjust Pricing to optimize margins
- Revise Menu to remove or redesign “Dog” items, promote “Stars” items and create strategies for “Puzzles” and “Workhorses”
- Improve Costs through waste reduction, portion control, and supplier negotiation
3. Innovate with New Menu Items
Collaborate with your Upper Lakes Foods Sales Account Executive and Specialist team to generate fresh ideas. Creativity varies—some operators naturally innovate, others need support. Lean on your team to brainstorm, test, and refine new offerings that excite your guests and strengthen your bottom line.
Keep the following considerations in mind when evaluating each potential menu item:
Menu Item Evaluation Checklist
Strategic Fit
- Does this item support one of our strategic goals (e.g., boosting profits, attracting new customers, expanding day-parts)?
- Does it create a competitive advantage over other local restaurants?
Brand Alignment
- Is the item consistent with our brand, concept, and cuisine style?
- Will it resonate with our current customer base or help attract new guests?
Market Appeal
- Is the item aligned with current food trends?
- Will it generate excitement or buzz among customers (social media-worthy, craveable, etc.)?
Ingredient & Supply Considerations
- Are the ingredients reliably available during the planned menu cycle?
- Can we source the ingredients at a reasonable, stable price?
- Do any ingredients overlap with other menu items to minimize waste?
- Will ingredients be used quickly enough to avoid spoilage?
Operational Feasibility
- Can the kitchen staff prepare this item efficiently during peak hours?
- Does it require any new equipment, tools, or plateware?
- Will the prep and execution process be smooth and consistent?
Financial Viability
- Can the item be priced attractively while still maintaining a good profit margin?
- Will it help increase overall check average or bring in new traffic?
- Is the risk of food waste or spoilage low?
