The Pareto Principle In Hospitality: Menu Developement

August 29, 2019

You invested a lot of time and energy at your workplace. And now you have tapped that opportunity you’ve been waiting for; a promotion to become a manager. We have established an outline of reliable solutions targetting specific issues, be it improving inventory control, and staff evaluation. But now you face another challenge ahead of you! Creating and pricing a new menu for your establishment.

This is, by all means, not an easy task at all; yet, the Pareto Principle still applies. 20% of your requested items get ordered 80% of the time. For example, at a fine dining restaurant, a guest will order an item that they are familiar with. Dishes like a burger, a steak, and the Ceasar salad are regulars. On the flip side of things, the rest of your 80% items get requested 20% of the time. Your shrimp scallop, baked octopus, and cauliflower steak may not get the most request. The same goes for the bar; 80% of your requested drinks will come from 20% of the menu. Most people will often choose a classic cocktail that they are familiar with or order a cocktail that caters to their flavorful needs 80% of the time. So where does this leave the other 80% of the items on your menu? How to better promote and market these items, prevent waste, and diversify your sales. There are three ways to develop a winning menu for your restaurant.

Philosophy

To get started, analyze what’s been successful so far in your establishment. Which of your dishes and cocktails receive the most request and which ones do not. Developing a concept of what is attractive for your target audience is essential. It diverts you from venturing in different areas that may not pan out. Conduct research on what is trending in the industry. Check out how that can be locally sourced for you to spend the least amount of money. Choose your products wisely. Figure out the local farmers who are moving in an environmentally conscious direction.

There may be another goal to accomplish, depending on the restaurant you are working in. That is developing a seasonal or themed cocktail list. There are a few things to consider while creating a cocktail menu that will pair well with the dishes.

Do the cocktails fit the brand of your restaurant?

Maintaining a consistent and attractive brand for your restaurant is essential. That means having your food menu as well as your cocktail menu compatible with your esthetic. For a bar manager at an Italian restaurant per se, the philosophy would be to learn about famous liqueurs, vermouths, and aperitifs representing historical Italian culture. The aim is to provide an all-around experience of Italian Cuisine along with delicious cocktails. Same goes for French restaurants. A drinks menu would have a wealthy list of wines along with cocktails featuring many flavours representing the French style. But, some restaurants do not follow this trend. Restaurants featuring only American style food with a variety of cocktails do not follow a theme. Developing a cocktail menu will take an excessive amount of your time. But understanding the theme and philosophy of your establishment will help you move on the right track.

Resources

Once there is a philosophy in mind, you need to consider another sector where the principle applies, and that is your resources. 80% of dishes and cocktails will come from 20% of the resources. Proper research will enable you to figure out what other flavour profiles pair well with one another. Some books can help you with this task. Cocktail Codex, The Flavor Bible, and Kitchen Creativity are worth a read. Make sure to take plenty of notes of the different flavour pairings that you may come across. This will increase your efficiency in R&D and reduce wastage when trying to create something new. It will also increase the diversity in your selection as you will be implementing more ingredients than the usual 20%.

Pricing

Creating value is more than just price. The most complicated process of a complete menu creation is pricing the items. When developing a pricing strategy, all factors come into play. Food cost percentage, cost per pound or cup of each ingredient, and the cost of labour. The same goes for pricing your cocktails at the bar. Knowing your pour cost, considering your labour, and finally getting insights on your competition.

Here are a few key steps that will get you in the right direction:

Construction and Calculation:

Have a good familiarity with your cost of goods inside your establishment. Prepare your margins for maximum profit. A way to achieve this is by establishing a food and alcohol calculation system. This will cut your hours using a pen and paper, or an excel spread and help you develop.

Competitive Analysis:

Learn what your competitors are doing. Figure out their pricing strategies for items that are similar to yours. There is no need to duplicate their pricing strategy. Their budget for the restaurant may differ compared to your own. A tip would be to conduct research online or visit your competitive restaurants to see what they have to offer. Compare the high and low prices on their menu to your own to determine a proper average.

Menu development is an investment that will deliver returns if done correctly. Conduct an extensive research and development strategy towards your menu. Look into the inventory in your establishment. Market trends and competition is sure to give the information needed to produce a menu that is attractive to your guests. This will help you achieve the overall growth for your establishment from being good to great.

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