July 22, 2024

What is Menu Engineering | Financial Management for Restaurants

Published May 23, 2023, 12:20 p.m. by Arrik Motley

What is Menu Engineering?

Menu engineering is the process of analyzing and improving the profitability of your restaurant’s menu. It’s a key part of effective financial management for restaurants.

There are two main goals of menu engineering:

1. To increase sales of your most profitable menu items

2. To reduce the cost of your less profitable menu items

Menu engineering can be a complex process, but it’s worth it to take the time to do it right. A well-engineered menu can be a powerful tool to increase your restaurant’s profitability.

What is Financial Management for Restaurants?

Financial management for restaurants is the process of managing your restaurant’s finances to ensure profitability. It includes tasks like menu engineering, controlling food and labor costs, and managing cash flow.

Effective financial management is essential for any restaurant business. It can help you make smart decisions about where to allocate your resources and how to grow your business.

Why is Crunch TimeZ the Best Virtual CFO for Restaurants?

Crunch TimeZ is the best virtual CFO for restaurants because we understand the unique challenges that restaurants face. We have a team of experienced restaurant financial experts who can help you improve your bottom line.

We offer a full range of financial management services for restaurants, including menu engineering, cost control, and cash flow management. We’ll work with you to develop a customized plan that fits your specific needs.

If you’re looking for help with financial management for restaurants, contact Crunch TimeZ today. We’ll be happy to answer any questions you have and get started on improving your restaurant’s bottom line.

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hi welcome to another video presented to

you by revive group the place to be to

make the tangible connection between

your business operations and its

financial performance

in this video we want to talk to you

about menu engineering for

all those businesses in food and

beverage industry we know while the

barriers to food industry can be

relatively low

barriers to success are too many now

it's more important than ever to look

for ways to increase efficiencies

to be more sustainable understanding the

mechanics of menu engineering

can be a good starting point you are all

asking what is menu engineering

understanding the profitability and

popularity of menu items

and where to put them psychologically on

a menu is what manual engineering is

all about the goal is to simply increase

the profit

inventory management systems can serve

you very well when it comes to

calculating your food cost

but if you don't still have a restaurant

software don't worry we will show you

all the calculations you need with the

sheets we simply built just for you

let's quickly look at how you can

measure your menu profitability you need

to answer these questions

what is food cost and gross margin of

each dish

how much money you make by selling each


and what is the popularity of each dish

in this video we are going to talk about

menu engineering concept

food cost calculation menu profitability

review dashboards and analyze menu items

what is gross margin gross margin is

simply your menu sale price

minus food cost that's why it's so

important to know those pieces of the

equation what is your food cost

and how much you need to sell each item

with the help of excel

we put together different tabs that you

can build your entire menu with it

one of the tab is your entire item list

with their respected measurement type

and costs you can also use it as your

shopping list

in another tab we have the menu item

type from appetizer to side dish

and different measurement types you can

easily modify these based on your

restaurant type and where

your business is located if you follow

the matric

or imperial system and finally every

recipe has

its own little tab where you can build

your recipes from scratch

put some direction for your team and

have the entire recipe cost calculated

let's finish the cheesy stick recipe

that we had started earlier

we want to add one pinch of salt to this

recipe you have drop down box

all around the spreadsheet you can just

easily click

and select your item look at the

measurement and voila

the cost is gonna calculate it and the

recipe card

is gonna get updated when you press the

recipe index up the top

you can go to the list of all your

recipes you can use

comments and tags for any extra

information you desire to add

such as allergies

now let's move on to your menu when you

can set a desired margin percentage to

each individual dish

to calculate how much the sale price has

to be

by updating how many dishes you sold at

the end of the day or the week depends

on how you want to maintain the


you can also calculate menu popularity

and profitability

the graphs on your dashboards are now

updated to show you that cheesesteak

is not only the more profitable dish but

also the most popular dish you have

based on popularity and profitability of

each menu item that we just discovered

it will have four different categories

of products

first is your stars they have high


and they are really popular your stars

are your signature menu items

they are your stars promote them as much

as you can and

stay consistent delivering them the


are your question marks they have low

profitability but they are really


these popular items are costing you more

than they

should investigate why they are costing

you more try making them with less

expensive ingredients and look at your

portion sizes

serving them in smaller portions can

increase your profitability

the next category are your cash scouts

they are really profitable but they are

not popular

these dishes are hard to sell but they

bring considerable amount of profit

these are your hidden treasures

understand why they are not popular

and make necessary steps to make them

stand out

and the last category unfortunately are

your dogs

they have low profitability and low


these items are not positively

contributing to your business

so consider removing them from the menu

let's recap

today menu engineering is more than a

buzzword make sure you are doing these


frequently the difference is making your

business the one that

stands out and grows or the one that


if you would like to get us started and

get in touch we offer consultation

services for a deep dive into your

business finances

the contact detail is down below and

until then

please make sure to subscribe to our

channel and we will see you

in the next video


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