Thanks for joining me on the podcast. Today is all about the power of your menu, not just about being a list of food, but how to make your menu a money making machine, how to cost out items, how to determine profitability of items, which is a real needle mover and a strategy. It’s about branding, it’s about design, colors, fonts, sizes.

All these things are super, super important, but the emphasis is on how do you squeeze every nickel of profit. Outta your menu. You’re not gonna wanna miss this episode if you really wanna dial in your profits. I have something called the Menu Profit Accelerator, which is a complete template on how to figure out what items you’re most profitable versus popularity of items, and how to see where you’re making money or losing money.

Every single day you might be filling your seats wondering why your bank account isn’t growing. The Menu Accelerator will put more money to your bottom line, so check that out at restaurantrockstars.com. Now on with menu strategy.

You are tuned in to the restaurant Rock Stars Podcast, powerful ideas to Rock your restaurant. Here’s your host, Roger Beaudoin.

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Let’s talk menus. Your menu is your most important marketing tool. It should be a moneymaking machine, not just a list of food. It should represent your brand. It should represent your business. Branding is all about colors and fonts. There’s a strategy to this and there’s so many different choices.

Know that there is graphic design help available to you if you want to choose your own font or have someone create your own font. Now, I did this in my restaurants. If something doesn’t meet your brand expectations, why not talk to a graphic artist and get them to create something really unique and special?

And that would be awesome for your menu and your advertising. You wanna tell your unique restaurant story? Now every restaurant has a story. My story was I was starting a wood-fired pizzeria 30 plus years ago, and as you might know, pizza was invented in Naples, Italy. So I jumped on an airplane and believe it or not.

The oldest pizzer on the planet that’s been handed down from generation to generation that actually invented the food we know of as pizza is still in business today. I just had to see this place and I lived in Italy for a while and I had very basic Italian skills and I walked in the door.

Beautiful brick oven covered in mosaic tiles right in the middle of the dining room and the pizza makers are throwing the dough, and it was such a show and I’ve always believed that the restaurant business is show business. In my very rusty Italian, I was able to tell them that I had a pizzeria that I had just opened in America and I wanted to do things.

The author. Authentic Neapolitan way. I never expected anything. I just wanted to see if I could learn something. The next thing you know, they threw an apron over the counter come on back. And I made pizza in the oldest pizzeria in the planet for about five hours, and they taught me secrets that I put into my pizzas.

In my pizzeria. Now, nobody else could tell that story, and that was a powerful story. So I printed that on my menus and on my table tents and on posters on the wall, and on my takeout box, my pizza boxes. I printed it everywhere. That was a story. What’s your story? Promote it. It’s powerful. Put it on your menu.

You wanna make sure that your menu can be red in dim light. I go to so many restaurants and the font is small, and the type is dark, and you know the lighting just isn’t there. And then you need to pull out your phone, turn on the flashlight just to read the menu, and that’s a pet peeve. And you don’t want the tap into your guests.

Most importantly. Highlight your hooks. What are your hooks? The unique, special, different items that you sell that the competition doesn’t that capture your guest’s imagination? They love them. They’re popular. Hopefully they’re very profitable to sell.

You have lots of choices in terms of the size, the style of a menu. Now, some people have one sheet menus that they print every single day because their specials change or their items change based on farmer’s markets and fresh product. Okay? That’s not very cost effective. But it can be elegant. But again, they’re one use only because they get soiled and dirty.

You have to toss them out. You need to print lots of those. You can do a double fold or a front and back, double sided, or you can do a tri-fold where you literally have three pages that open up. It depends on the size of your menu, but these days it really helps to streamline your menus. Streamline your menu items and make sure that everything you’re selling is profitable.

We’re gonna dive into that a little deeper as well. Do you have sleeves that you put your menus in that make it easy to clean and you don’t have to throw them out, they don’t get soiled? Maybe you’ve got a beautiful leather book and you open it up. The choices are endless. Maybe you just have a lamination.

And the plastic, double-sided menu is laminated. And again, it depends on your concept, it depends on your price point, but you have choices. The key is, of course, does it represent your brand and concept to your guest. All these things are part of your strategy and they matter. Let’s shift gears for a moment.

I want to talk about some important housekeeping issues. Before you can have a profitable menu, you need to take inventory. Now, I travel a lot and I speak with lots of restaurants on the road, and I ask them, do you take inventory? And so many of them think it means placing next week’s order. No, it doesn’t.

It’s all about calculating the true value of your goods on hand at any given time. And then week after week. Calculating your food cost. Now, the same process is takes place with your beverages as well, but for now, we’re talking about food costs because before you can have a profitable menu, you need to know what your food cost is.

All right? So in order to calculate your food cost, let’s just say I. You have all of your inventory arranged on a template. Now I can help with that. If you don’t have an inventory system in place, reach out to me, Roger, R-O-G-E-R, at restaurant rock stars.com. But let’s just assume you’ve got your template, you’ve got all your pricing on all your, you know the value of your goods as it comes in the door, and then you literally do the counts.

And it’s so important to do the counts when your inventory levels are at their absolute lowest. And for most of our restaurants, that’s at the end of a busy weekend. But the process is simple. You literally take the counts at the end of the weekend. Hopefully it’s Sunday night, or maybe if you’re little burned out after a busy weekend, you take it early Monday morning.

But it’s so important to do it before your delivery trucks come in that Monday morning. Okay, let’s just say you take inventory four weeks in a row and I’ll tell you what the process is, but you do this because you wanna establish what I call the sweet spot. Now, maybe you take your physical counts and then you calculate your food cost the first week, and you get a 32%.

You might be happy with that. You take it one week later and now it’s a 36. You do it one week after that, and now it’s a. 29 or 30. Okay. And then one more week, and it’s something else. You don’t know what your food cost is. There’s no sweet spot. It’s all over the map. Maybe you’ve got a waste problem or a theft problem, who knows?

And that’s why you need to take it four weeks in a row until you consistently reach 32, 32, 32 and a half, 31 and a half. Close enough. That’s your sweet spot. The second step is a formula. Once you’ve calculated or you have a template I have that I can share with you, but once you’ve calculated the value of your goods, the first time you do it, the first time you do a count and you’ve got a value.

Maybe it’s $5,000, maybe it’s 10,000. It depends on the size of your restaurant. That is what is called your beginning inventory. Now the formula is this beginning inventory plus your purchases. Now that means the truck showed up Monday, Wednesday, Friday, whatever. And those are all the deliveries that came in the door.

So it’s beginning inventory plus your purchases, minus ending inventory. What’s ending in inventory the second week that you count it. After the delivery trucks come in. Okay, so beginning inventory plus purchases, minus ending inventory equals what we call usage. Now, I have a template that automatically calculates usage.

You don’t calculate it, but what that means is. Anything that you sold to a guest for full price, anything that you sold to a team member at a discount, perhaps anything that comps and voided off a check, anything that was wasted, spoiled, stolen out the back door. It’s all calculated. That is your true food cost.

Now, once you have that usage number, all you have to do now is divide by weekly food sales, and. Food sales only for that period, and that’s gonna give you your food cost percentage. I have to tell you, you don’t. You can’t make certain mistakes. I’ve seen lots of restaurants do this process, and they’re counting things that are not food.

They’re counting soda straws and plastic wrap and mop heads. No. If it doesn’t go on a plate and if you don’t serve it to a guest. It’s not food cost. Same with bar items. You need to separate bar items. Maybe you get a case of lemons and maybe half of it goes to fish dishes. If you sell seafood and the other half goes behind the bar, you need to take that into consideration.

But only count food, only. The only exception here is since the pandemic and so much delivery and online ordering and curbside pickup and takeout, all that sort of thing, and even the people that don’t finish their meals and they ask for that. Takeout container. The doggy bag, you should cost that out and consider that to be food inventory.

Okay? Once again, to recap the formula, beginning inventory plus purchases minus sending in inventory equals usage that’s automatically calculated divided by food sales only for that period equals your food cost. You need help with this. Again, reach out to me, Roger. Restaurant Rock stars.com. Alright, next.

A lot of the industry is not aware of that key indicator called prime cost. Prime cost determines whether or not you’re making money in your restaurant. Now, that’s a simple formula also. Okay. It’s simply the sum total of your food, beverage, and labor costs expressed as a percentage. So let’s start with the formula.

Let’s. Let’s just assume that your food cost is 32% and then your beverage cost is 22%. Add those two together, you get 54%, and then you divide that by two because I mentioned it’s an average of your food and beverage cost, and that gives you 27%. Now we’re not done yet. We’re almost done. Next, you need to add your labor cost.

Now, I always tracked labor every single week. When the payroll comes in, it’s every single, wage that you paid an employee. It’s all the taxes, it’s the fees. If you pay yourself or a manager, that’s included. That’s your total labor, whether it’s on a biweekly basis or every single week. So let’s assume that your labor cost is 32%.

Your average food and beverage was 27. Your labor cost is 32. You add those together and now you get a 59. That is your prime cost. Okay? What does that mean? The industry standard says that to make any money in this business, your prime cost should be somewhere between, say, 55 to 60%. Now, this is simple math.

That means that for every dollar of sales, 55 cents to 60 cents is going just to food. Beverage and labor, and there’s so many other expenses in your restaurant. There’s your lease, your insurance, the dumpster in the parking lot, the utilities, the repairs and maintenance linens, if you have them on the table, fresh flowers, the list goes on and on.

So you really want to shoot for the lowest of that range, 55% up to 60, but the, the better and the lower you got the more chance you have of making money. So let’s just say you’ve got 55%. Prime cost. That means that 45 cents of every dollar is left over to pay all those other expenses. This is really important stuff.

Okay. All right. Let’s talk menu pricing strategy. You must cost out your menu. That is vitally important. Now, I’ve done this exercise for multiple restaurants and. A lot of restaurants aren’t even costing out their menu. And with volatility of goods and rising prices, you can’t afford not to know what it costs you to serve every single item to every single guest.

So it starts by taking an order guide from your suppliers or your invoices, and there’s a little homework involved here. You have to work with your kitchen manager or your chef and reverse engineer every single item so you know when the big bulk comes in the delivery. How much of the, each of those ingredients goes into any one item.

Again, it’s simple math. You can do this with a calculator and a pencil. I can show you how to do it. I have templates for this, and again, reach out to me and I can help you with that. Alright? Must cost out your menu. Every category, every item. Then let’s just assume that you have all these cost sheets for every single item in your restaurant.

Now, maybe it’s on the computer, maybe it’s pieces of paper like this. You rank start with each category. Let’s start with appetizers. You rank each item from the most profitable to the least profitable, and you put down. How much each contributes in profit. Now, when you cost out your menu, you have a list of your ingredients and how much each of those ingredients costs you based on the quantity or the amount or the ounces of every one of those ingredients that goes into the dish.

And my template automatically calculates the total. So that’s called your plate cost. When you have all the ingredients worked out for any single item on the menu, that’s your plate cost. Now, a cost sheet should also include. The menu price. How much do you charge your guest for this item? That’s next. And then there’s simple math that determines, one, your profit on the item and your food costs.

So let’s just say, the item costs $3 on the menu. No, I’m sorry. Your play cost. Let’s just assume the play cost is $3. Okay. If you’re following me here and you charge $7 on the menu, the math is obviously the $7 menu price minus the $3 item. Cost gives you a $4 profit. There’s your profit. Now, your food cost is determined by dividing.

The plate cost of $3 by the menu price of $7, and that gives you your food cost. So that’s a complete costed out menu item right there. So once you’ve got the profit of each dish, then take those cost sheets and say, this is the number one most profitable, the number two and the number three, and so on and so forth.

Now, why are we doing this? I have another template that has really calculated the menu profit of. Different restaurants that I’ve worked with and you wouldn’t believe how much money they’ve lost. Now, I worked with two restaurants recently that were about $3 million operations. I showed one that they’d left a potential profit last year of 343,000 on the table, and the other one was closer to $365,000.

Why? Because their lower profit items were bigger sellers in every menu category, taking sales away from what they wanted to sell, what they could be selling, and everything in ranking order is shown on my template, and it shows you where you’re losing money every single day. Alright, the next step, let’s just say you’ve got these cost sheets.

You’ve got them ranked from most to least profitable. Then you need to figure out the volume of sales over a period of time. If you change your menu once a year, okay, you’ve got 12 months of data. If you change your menu twice a year, you’ve got six months of data. The more data the better, because it’s more telling information about how much profit you’re leaving on the table.

Okay? This is why. Restaurants might be filling their seats and wondering, why is my bank account not growing? Okay. Because the profit difference in each category is many dollars. When you’re selling appetizers, you might make a $3 profit on one, a $5 profit on another, a $6 profit on another, and you can see there’s a multi dollar difference in the profit.

And in many cases, you’re selling lots of $3 items when you wanna be selling lots of $7 items, because that’s. Impacting your bottom line. Okay. The most recent client I worked with, a five location pizza restaurant, and I showed them last year that they left a potential profit of $885,000 on the table across those five locations because the profit spread difference in all the different pizzas on the menu was huge.

Their biggest seller, the cheese pizza they sold 70. Thousand of these things roughly, and every time they sold that, they left $8 on the table from their more profitable pizzas up above. So that’s a huge needle mover. So what do you do? Once you’ve costed out your menu and you know which items are the most profitable to sell, you train your staff to suggest those every table, every time.

You can go back and do a quick menu, reprint and box those in, highlight them. Call the most, most popular or guest favorites, whatever it is. The eye is naturally drawn to those things, and that will sell more of those items quickly. Raise the price on those lower profit big sellers that your guests absolutely love.

The market will bear our price increase and get it closer to the profit of the other items. Internally market them. Okay. Again, we already talked about highlighting them on the menu, but where else can you put them? Do you have table tents on the tables where you can highlight your most profitable items that you wanna sell?

Hopefully those are your hooks or your signature items, portion controls. I can’t tell you how many restaurants I see that do not have strict portion controls. In place that is so vitally important also, and checks and balances to make sure that every single person making every single menu item is making it to spec and not putting extra slices of pepperoni on a pizza or two scoops of ice cream on a pie.

Alamo, just to get a bigger tip, you need portion control, spec standards, and photographs. That’s really important. Next you can shop comparable quality ingredients. If you work with a certain supplier that you’re really happy with, they buy in huge volumes and new products are coming in the door all the time.

They know what you’re buying now. But if you don’t ask, you don’t get, ask them, is there anything that I can buy at a better price because you bought it in greater volume. The quality is there, the flavor profile, the guest will never know. And always ask for a sample if that is possible. And if if you cook it up and if you like it, if it tastes great and you know that your guests will never know the difference from the prior product, but it’s at a better price, it’s to your advantage.

And then we’re gonna design a new menu. Go back to the drawing board. Work with your kitchen man, manager or your chef, or work with me and design a new menu that. Contributes a very similar profit in every category. And what I mean by a similar profit is for the lower priced menu items like appetizers, it’s okay if every single item is within 50 cents of each other, that’s fine, but not $3, $4, $5.

Like my example before on the entree side, make sure that every item is within $1 of each other. And not 7, 8, 10, 12. I’ve seen restaurants leave as much as $18, a potential profit on the table from more profitable items that they could be selling. That’s really important. Okay? Strategy number two, shop your competition.

Listen, don’t lose birthday business to your competition. People celebrate birthdays seven days a week. The check averages are high, and when they have fun in your place, they’ll come back again. Talk to my buddy Dyson. He’s an operator also just like you and me. But now he runs a done for you birthday club.

Go to jointhebirthdayclub.com/birthdayrockstar. It’s a piece of cake.

Play your best game, but know what the competition is doing okay? And look at their menus. And if you’re selling the same items, look at how they’re pricing those items. Now, what do you do? You can slightly underprice them if you’ve got a high volume restaurant, okay, and a low prime cost, that’s important, but that’s just one strategy.

You can meet their price. That’s another strategy. Or you can price slightly higher than the competition if you have added value. If you’ve got a amazing service, if you’ve got a great location, if you’re in a tourist resort or area, or if you’ve got an amazing view, obviously you know you can charge higher prices for that.

Think about. Adding catchy, funky names to your menu items. Don’t just call it the chicken parmesana or the nachos. It’s come up with really unique items for every item on the menu. Item names are really powerful. I had crazy names from my desserts and my entrees. It’s like the chocolate peanut butter blast and the raspberry cream disaster.

You get the idea, it captures the guest imagination. Have a glowing description, and then make the price at the end of the description a little bit smaller than the font size for the description and remove the dollar signs. Okay. Don’t call attention to the price. What do I mean by remove the dollar signs?

Just put the digits. If you’re selling an $18 steak, just put 18. Or if it’s a $25 seafood dish, you get the idea. 25. Okay, that’s a good strategy also at the end of the glowing description. All right. How about some smart hacks? Are you cross utilizing ingredients? Now that means that you don’t bring in one ingredient if it only goes on one dish.

Hopefully, all the ingredients that you have are utilized on many dishes, and that minimizes your waste and your spoilage loss leaders now. A long time ago, they used to have what was called the early bird special. Now, that’s kinda goofy, right? But the idea is really sound because our restaurants are usually busy from seven o’clock on, especially on weekends.

But what can you offer for a pricing that gets people in the door so you at least get one table turn before you get busy? So you need a loss leader, but you’re also hopefully gonna sell alcohol if you have an alcohol license, and that’s very profitable. So come up with a dish that you can charge a little less for.

That’s really attractive. And market that and try to get people in at six o’clock or six 30. All right. And again, portion control standards are vitally important to make sure that you’re maximizing your profit. Okay. Do you notice lots of doggy bags? So portion sizes are really important. You gotta watch all of your customers.

And if you’re sending lots of food out the door and takeout containers, chances are your portion sizes are a little too big. All right? So that’s not only costing you extra food cost, but it’s also more takeout containers going out the door, which is also part of the food cost, as I mentioned.

Alright, what are the big opportunities? Events and holidays. Did you know that there’s a major food holiday just about every month of the year? And if you sell that food, you need to promote that as a reason for your guests to come in the door. It’s National Cupcake Day. It’s national cheeseburger day.

You get the idea. If you sell any of these things, go to the. There’s a calendar. You can just Google it, food, holidays, and then look at that, put it on your own calendar, and then come up with a theme dinner or a special item. That’s a big deal. Now, all the other events that happened, Valentine’s Day, St.

Patrick’s Day, Mardi Gras, Cinco de Mayo, mother’s Day, father’s Day, Thanksgiving Day, the Super Bowl. These are all big events that you can promote with a special menu. I even had my staff. Get into character and on a Super Bowl, they’d all be wearing the jerseys of their favorite team and they’d have the little blackout paint under their eyes, and they would get into the spirit and they’d all wear green for St.

Patrick’s Day, and they’d all have beads on for Mardi Gras. You get the idea. It’s really fun if you get a family casual restaurant, get in the spirit, but promote these special holidays and promote them in advance, that’s a big deal. All right. What about slow nights? Every restaurant isn’t busy seven days a week.

There are certain nights in our restaurants that are slower. First, you need to determine what your daily break even is, and that means how much does it cost to open the doors of my restaurant, whether I serve 10 people or a hundred people, or a thousand people, and that varies on the size of your restaurant and your expenses.

Of course, if you don’t know how to do this, again, reach out to me, [email protected]. I’d be hap happy to help you with daily break even. Alright, a locals appreciation night. It’s a simple idea, but if you serve a certain signature food that your guests absolutely love, why can’t you discount that on a slow night?

Especially if you’re making it up for the alcohol Now, for us, for many years, Tuesday. Traditionally was the slowest night of the week, but we, I immediately changed that by coming up with $5 pizza night, and then that became one of the busiest nights of the week. Now, yes, we offered a one topping, single sized pizza for $5, which was a value, but we served a bunch of drinks with that.

Everyone that ordered a pizza had at least two drinks, and then they jokingly referred to it as $45 pizza night because their average check was about 45 bucks. But you get the idea. Come up with a special night theme and then try it out and see if that doesn’t drive business. If you absolutely can’t do that, then your daily break even is gonna decide if it makes more sense to close that night or open.

Okay. A lot of people confuse that. All right. Happy hour menus. That’s a big deal, right? Everybody loves happy hour. If your state allows it, you can have a special menu. Maybe little tasting plates offer special drink prices. Maybe you only do this between six and 7:00 PM or earlier, five to 6:00 PM whatever if you can choose, but it works really well.

Next cash cow, come up with some cash cows. Those are items that have very high perceived value by the guest, but they cost very little to serve. Now that’s really powerful because you can. Go out to local businesses and print coupons with that cash cow on it, and then tell these businesses, high traffic businesses that have lots and lots of customers say, listen, I’d love to have you send your guests into my restaurant on a Tuesday night or a Wednesday, whatever’s the slow, and I will give them an absolutely free whatever it is, provided it costs you very little.

And then say, listen. If you stamp the back of the coupon, let you know and they come in the door, I’ll give you 10% back in trade before tax. For every dollar you send us. Now, this was a powerful idea. I didn’t limit it just one day. It was valid like five days a week. ’cause I didn’t need the business on Fridays and Saturdays, but some of these businesses sent me $15,000 in a couple of months.

In brand new business I would not have had. So that’s a big deal, but come up with the cash cow idea and that’s huge. Okay. Last, do you have a family friendly place? Because if you do know that, the kids often determine where the family dines out. They wanna go to the fun place, and there’s so many things you can do to create a really fun, friendly environment for the kids.

First. Do you know what a diorama is? You’ve seen these things at carnivals. It’s basically a giant piece of plywood, four by eight sheet perhaps, and it’s got holes cut out, but you have an artist paint something that’s common to your theme or your restaurant that’s really catchy because this is a social media event, and then people get behind it and they take selfies with their faces sticking through the holes.

In line with a theme of the logo of your business provided you get an artist to do something really special. The kids love to do it. The adults love to do it. But what happens? The phones come out and now this goes viral because they’re sending this to all their friends in your restaurant and it drives business.

That’s powerful stuff. Helium balloons. We used to give out helium balloons to the kids. We used to have a fishbowl filled with lollipops. We had a prize chest that the servers would take to the tables with inexpensive kids’ prizes that they, the kid could stick his hand in, pull out a prize. This is all entertaining stuff, but most powerful of all, we’ve seen these crane games, where the kids literally try to win the stuffed animal or the candy crane and just know that there are companies in every state that will provide these games to you for free in exchange for.

The real estate you. If you got a small space and you just need one crane game, or if you’ve got a little bit more space and you bring in video games and pinball machines and all that kind of stuff, we certainly did. We had an arcade in our biggest restaurants, and this company will not charge you anything.

They will maintain the games. They will give you a change machine. The parents are happy to put the $5 $10 bills in the kids’ hands just so that they can have an entertaining, fun night out without worrying about the kids. And then at once a week, the game company comes in and they simply cash you out and they give you 50% of whatever the game’s brought in.

So that’s really powerful. So those are some tips on maximizing your menu, costing out your menu, maximizing your profit. And it’s really a strategy. So that’s it. Thanks for listening. Thank you to our sponsors of this week’s episode. Thank you all for tuning in. Can’t wait to see you next time, so stay tuned.

Stay well, and I will see you then.

People go to restaurants for lots of reasons, for fun, celebration, for family, for lifestyle. What the customer doesn’t know is the thousands of details it takes to run a great restaurant. This is a high risk, high failed business. It’s hard to find great stuff. Costs are rising and profits are disappearing.

It’s a treacherous road, and smart operators need a professional guide. I’m Roger. I’ve started many highly successful high profit restaurants that I’ve now sold for millions of dollars. I’m passionate about helping other owners and managers not just succeed, but knock it out of the park. I created a game changing system, and it’s filled with everything I’ve learned in over 20 years running super profitable, super fun restaurants.

Everything from creating high profit menu items and cost controls to staff training where your teams serve and sell to marketing hooks, money, maximizing tips and efficiencies across your operation. What does this mean to you? More money to invest in your restaurant, to hire a management team. Time freedom and peace of mind.

You don’t just wanna run a restaurant, you want to dominate your competition and create a lasting legacy. Join the academy and I’ll show you how it’s done.

Thanks for listening to the Restaurant Rock Stars Podcast. For lots of great resources, head over to restaurant rock stars.com. See you next time. I.

Restaurant Profit Maximizer Mini-Masterclass: Learn how just a few tweaks in the way you do business can massively impact your profits! https://restaurantrockstars.com/sp/restaurant-profits

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Stitcher – https://bit.ly/3iFGAAb

Soundcloud – https://bit.ly/3lYBhho

YouTube – https://www.youtube.com/@RestaurantRockstars

Ask Roger a Question or Share a Restaurant story with us:

https://www.speakpipe.com/RestaurantRockstars