OPERATOR'S MENU GUIDE
SOLVING NEW MENU ITEMS
Diners want to regularly encounter new items on your menu – but how do you find the time to create, with everything else you have to do to keep your business running? Make it easier with the right inspiration:
Operators’ top sources of inspiration for new menu items are:
39% their customers
38% other restaurants
37% distributor food shows
You may have many reasons for being hesitant to change your menu. Adding an item to your menu is an investment – from purchasing products, to training your staff and promoting the new item to your guests. And what if customers don’t bite? Specials and limited-time offers (LTOs) can allow you to test fresh menu items before committing to the dish on your full menu.
When asked why they offer LTOs rather than adding new items directly to the menu:
51% of operators stated it’s because they want to test consumer response to the item.
“Specials make the place interesting,” says Mikles. “It makes it interesting for the guest to come here, but it also makes it interesting for the employees to work here.”
THREE GREAT WAYS TO
FIND IDEAS FOR SPECIALS
- Did one of your sous chefs or line cooks blow everyone away with a new dish at a family meal? Nurture their creativity by adding the dish to your specials menu that week.
- You’ve sensed your diners’ tastes are changing. Use an LTO to push the boundaries and see how they react. Have they enjoyed your new plant-based items, and are they willing to pay more for them? Use that information to find other ways on your menu to satisfy their cravings and increase check averages.
- Take advantage of seasonal ingredients. Diners today realize that everything isn’t in season year-round, so they go looking for the best applications of seasonal ingredients. Capture their curiosity by creating seasonally inspired offerings that allow them to taste produce at its peak.
Pro Tip: Call out that a special will be available for only a week or month to create urgency. Get ready for extra traffic and lots of tagged social media photos!
WHEN TO TAKE AN LTO TO YOUR FULL MENU
“Everything that's on our core menu we call ‘riot worthy’ – that if you took it off, there'd be a riot.”
– Lee Mikles, owner of Grain Craft Bar + Kitchen
Specials and LTOs are great ways to keep it fresh, but it’s also a shorter-term solution to driving traffic. You also have to consider changes to your full menu. But how do you know when an LTO is ready for the big leagues of your regular menu? Mikles says his diners decide. “The guests will really dictate whether something goes from being a special to being on the regular menu – and that means, do they continue to come back for it? Are they asking for it?”
Your customers’ opinion about your menu has less to do with what they say in words as what they express with their dollars. Monitoring customer feedback is important, of course, but tracking sales data is critical to the success of your menu and business.
Jim O’Donoghue, Mikles’ partner at Grain Craft Bar + Kitchen, is a strong advocate for operators using data to make smarter decisions in menu engineering. “We spend a lot of time in Avero; I look at it first thing every morning to see what’s selling, and what categories of things are starting to move,” he says. “Almost all of our decisions are based on numbers. A couple of my favorite items have gone off the menu because enough people didn’t buy them.”
“No decision should ever be made without understanding how it will impact your profitability. Don’t just put something on the menu or pick a price without truly understanding what the impact is to your bottom line.”
– Russ Spencer, US Foods Restaurant Operations Consultant
To understand the profitability potential of a new menu item, Grain Craft Bar + Kitchen uses tools to also make sure the price is right. “We work a lot with US Foods® Menu Profit ProTM to see what’s going to make the item price point correctly,” says O’Donoghue. “We break it down to the ounce cost per ingredient in the menu item. Using Menu Profit Pro, we can play with how much we’re using, so it really allows us to drive the price by the cost of the item.”
When the data shows your special is skyrocketing in popularity and the price is set for profitability, it may be time to take the dish to the next level. According to US Foods Restaurant Operations Consultant Brian Kerby, there are five must-haves that confirm whether it’s the right time to add an item to your menu:
5 RULES FOR ADDING NEW MENU ITEMS
From US Foods Restaurant Operations Consultant Brian Kerby
Your new item should yield more profit than any other item on the menu at the same price point.
If not, your menu addition likely will result in no financial lift – and could even lead to lower profit. Don’t forget: changing a menu is mostly about increasing guest contribution margin.
It must deliver more gross profit than the average product in its category.
Bringing in lower-priced and lower-food-cost-percentage items into a category that are below the current ACM run rate will result in going backwards in profits.
It must be efficient for the kitchen and should use existing ingredients where possible.
Bringing inefficient items into your kitchen will translate to slow ticket times and slower table turns – both of which cost your restaurant. Using existing ingredients when possible controls waste, saves storage space and streamlines ordering.
Your new item should either be unique or should be clearly differentiated from what competitors offer.
If it can’t bring value and be done better, or at least differently, than what your competitors are doing, why do it at all? Menu items that already exist elsewhere are hampered by established price guardrails. Better to add something different that doesn’t have a price established, enabling you to price for better profits.
It must be in tune with your brand and reinforce what your restaurant stands for.
You can sell egg rolls at a breakfast restaurant and make money, but at what cost to your brand and customer perceptions? Selling only for the sake of sales isn’t necessarily the best practice.