COVID-19 has introduced a number of significant problems to the restaurant industry, while also bringing one long-simmering problem to the fore: menu bloat.
Sure, the desire to be all things to all people at all times is understandable, but the truth is, even for the most-sophisticated restaurant operators, expansive menus have been difficult to navigate for some time. The coronavirus crisis has only exacerbated the issue—and made right-sizing a matter of survival.
Lengthy menus confuse customers, slow throughput, introduce increased performance demands on an already stretched thin staff, distract from menu profit centers and ultimately increase food waste—among other problems.
The result is a cycle of lower quality, lower check average and less profit. Additionally, customers have a lower satisfaction level.
Now restaurants are slimming down their menus in order to focus on their margins.
Industry pundits predict optimization efforts that include reducing SKUs, highlighting core items and launching safer LTOs.
McDonald’s scaled back its menu offerings soon after the pandemic began. First, it ditched all-day breakfast, much to the relief of the franchisees who never warmed to the idea. While the company has slowly begun introducing items back, the smaller menu resulted in faster drive-through service.
McDonald’s isn’t the only one trimming the menu fat: Taco Bell, Darden, Cracker Barrel, and Applebee’s have cut back on menu length in an effort to focus on margin-friendly dishes.
Still, operators must be strategic when making trims. With dining room shutdowns and restrictions changing restaurants’ very business models, the quicker an operator can crunch the numbers to find the menu superstars—and slackers—the better.
But here’s the problem: cutting the wrong item is just as detrimental as leaving too much. Here is how to maximize returns while slimming down the menu right now:
Analyze What You Serve and When You’re Serving It
What stays and what goes? You could guess. You could ask customers. But only data tells the true story. When planning on what stays and what gets 86’d from the menu, a POS system is a restaurant operator’s best friend. Good POS systems provide all the data managers could ever want: what’s selling, when it’s selling and how long it takes to get to the customer—after all, time is money. Plus, today’s POS systems provide clear, easy-to-understand reporting that breaks down and highlights necessary data.
Think In Terms of Margins, Not Just Sales
Even if a menu item sells well, but creates difficulty in the kitchen or provides a lousy profit margin, it may be time to reconsider if it belongs on the menu at all. Reliable restaurant management systems track food costs down to the cent. The POS will allow you to weed out the menu’s weak links, and identify your superstars at a glance. POS systems help restaurants target the most-profitable customers with incentives and increase loyalty with casual customers.
What Do Customers Want Today … And Tomorrow
Look for trends in sales data. Better yet, use restaurant management software that can do it for you. Up-to-the-minute sales data should provide operators with the ability to dynamically shift the menu according to what customers really want. That way, restaurant operators can leverage information to create specials, LTOs or just find better placement on the menu for hidden gems. That not only saves money by avoiding the initial purchasing costs of food items that will go to waste, but it keeps the waste from landfills.
Make Sure Your Data Really Delivers
Takeout is no longer a second revenue stream for businesses. For many, it’s their only business right now—so they have to get it right. When reevaluating a menu, be sure to look at both on-premise and off-premise data. Look at trends, ordering times, menu preferences and then lean into those insights to help you shape a menu that makes sense for off-premise customers.
The restaurant industry is fighting an uphill battle, but restaurants can win by harnessing data to ensure their menus are engineered to balance customer satisfaction and restaurant profitability. By following the above tips, restaurant owners can create a custom, data-driven menu that helps customers find exactly what they want, when they want it and allows restaurants to stay profitable at the same time.
Graham Campbell is the COO of Givex, a global cloud-based operations management solution designed to streamline business efficiencies and generate valuable and actionable customer data with offices in Canada, the United States, the United Kingdom, Australia, China, Brazil, Singapore and newly opened in Mexico City. Campbell is an innovative technology executive with over 13 years of experience in the payment, e-commerce and point of sale sectors.