Restaurants are getting creative with menus to counter soaring food
Long Beach Fish Grill’s menu board
Source: Jessica Dinglasan
Jessica Dinglasan, owner of Long Beach Fish Grill in Long Beach, California, never used to write “market price” on her menu.
But now the halibut fish she sources costs more than $30 a pound, nearly double what it was a year ago, and the 13-gallon container of canola oil she buys for French fries and crispy fish has jumped from $19 to $42.
“I have to do market price,” she said.
As food and labor costs rise, restaurants are making strategic changes to menus to avoid reprinting new ones every week. But price hikes can only help so much, especially since weekly changes in the cost of ingredients would mean frequent reprinting. That’s where menu engineering comes in.
Analyzing sales data and food costs can help restaurateurs decide which menu items to emphasize, which prices to increase and which offerings to eliminate altogether to optimize their bottom line. A smart menu design can highlight the food or drinks that will keep customers coming back or help with kitchen operations.
A slightly larger font or an eye-grabbing box, sketch or photo can quickly translate into dollars.
“To me, menu engineering is the layout of the menu that makes the order process the most profitable for the restaurant,” said Michele Benesch, president of the menu design firm Menu Men.
Pricing pressure
Sean Willard, a menu engineering specialist with Menu Engineers, estimates diners spend fewer than 90 seconds after sitting down browsing the menu. That puts pressure on restaurants to present customers with menus that help them order the meal they’ll enjoy the most, quickly.
The restaurant industry has been grappling with higher commodity costs for months now as demand for restaurant meals snaps back but their supply chains lag. Russia’s war with Ukraine has exacerbated the issue, sending gas prices soaring and spurring global shortages of wheat, corn and soybeans.
“Inflation’s not going down. I thought it would, but now there is this war,” Dinglasan told CNBC.
Food prices have climbed 7.9% over the last year, according to the Bureau of Labor Statistics’ Consumer Price Index. But not all menu items have felt the inflationary effects to the same degree.
“Chicken’s gone up, but not as much as fish or beef,” Benesch said.
Inflation’s not going down. I thought it would, but now there is this war.”
Jessica Dinglasan
owner of Long Beach Fish Grill
That puts seafood restaurants and steakhouses in a bind. Ruth’s Hospitality Group, for example, is forecasting its food costs, excluding beef, will rise 16% during its fiscal first quarter. Add beef costs into that equation, and the Ruth’s Chris owner is expecting the price of its ingredients to climb 24% compared with the year-ago period.
At steakhouses, facing steeper price tags, cost-sensitive diners may opt for a smaller cut of the filet mignon. So Benesch helps those restaurants round out their menus so customers are tempted to order more sides or appetizers.
“Maybe featuring the wedge or a…
Read More: Restaurants are getting creative with menus to counter soaring food