There are several factors to consider when setting restaurant menu prices. The main aim is to attract and retain customers but also meet all the restaurant costs. Arriving at the best menu prices requires a delicate balance between the costs, customers, and making meaningful returns. Here are some of the issues that you have to take into account when setting your restaurant menu prices.
Every item used in making the meal costs you some money that you would like to recover. Therefore, include all the ingredients without leaving even the smallest item. This ensures that you have the right value for each standard item you serve your clients. In case these items are many, leverage on the technology by making a spreadsheet list of all you ingredients for a quick summation of your costs. Take into account the cost of the raw ingredients used in your menu, the cost of cleaning the dishes and tables and the cost of labor used to prepare the menus.
Varying price points
Every restaurant owner has a different concept for his or her restaurant. This concept is reflected in the prices set in the menus. Consider whether your pricing points are similar or different to those of your competitors. The uniqueness of your restaurant may be in the quality and quantity of the offer or the quality of service a customer gets in your restaurants. If you have a competitive edge over the competitors, set a slightly higher premium price for your restaurant menu. However, be cautious not to overprice the menu to a point of driving your customer away to the competition. Remember that customer associate with the quality you offer them when they visit the restaurant.
When setting your restaurant menu price consider the characteristics of your customers. Take into account their social, economic or behaviors in setting a wide range of menu prices. Set a price for the family dinners or a group offer for friends who may visit your restaurant. This will ensure you are serving a wider range of customers. Remember that the prices you set for the menus reflect your restaurant’s identity and are among the first things the customers take note in your restaurant.
No fixed prices
The cost of ingredients used in your menu may fluctuate almost every month. At times, the changes are absorbed in the current menu prices. However, a change on the menu prices should be made when the fluctuation in the ingredient prices is too high. Always take in to account the needs of your customers before making a huge adjustment in the price.
You also want to earn some profits on your investment. Evaluate the percentage of returns that is desirable for the restaurant owners. The margin should not compromise on the quality of services or hurt the owner. Like all business, your restaurant also should generate a meaningful return on the investment. Add this margin on top of the cost to arrive at your restaurant menu price