Do You Have a Piece of Paper that Prints Money?
Editor's Note: The following is one in a series of blogs provided by the experts who have worked incredibly hard to make Spike TV's "Bar Rescue" reality program, starring Nightclub & Bar Media Group President Jon Taffer, such a success. The Bar Rescue Insider blog series will deliver tried-and-true tips and tricks to help bar owners, operators and managers solve common problems and increase their bottom line. Tune in to Nightclub.com for the next edition of Bar Rescue Insider!
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How often do you see your menu as a money machine? An ATM for your business?
I look at menus all the time, sometimes all day. I spend hours and hours on them – everything from writing them to evaluating them, even criticizing them. But the most alarming conclusion is that most people spend more time on the appearance than they do on the actual items.
It’s pretty painless to make your menu a profitable one with a few tweaks here and there. However, if you have items that are “losers,” taking up precious space, you are not only losing money you’re damaging your brand.
My theory is a simple one. If you have 50 items on your menu and you only execute 25 of them at the highest standard, your brand/concept/reputation is only good 50% of the time. So. . . how do you fix this?
1. K.I.S.S - you know what this means. I would rather see you build a menu that has 15 items executed at a 100% and then add to the menu.
2. You have a POS System – then use it! Talk with your rep to find out what else it does. It should:
a. Be able to provide you with a Product Mix
b. Provide you with a snapshot in each category of sales (i.e. apps, sandwiches, salads, entrees)
3. Once you have these tools in place now you can start tracking your item usage.
a. How many burgers did I sell last year?
b. How many orders of wings did I sell last week?
c. Why did I only sell two of Grandmas meatballs?
4 .Now follow the simple rule of 100%
a. Every menu has a top 20%, these are your biggest sellers and should be your “signature items”
b. Then there is the middle 60%, these items are all dying to make it to the top 20%. Middle 60 are always trying to make the move to the big time.
c. Finally there is the bottom 20%, these are your deadbeats who are not paying rent and therefore need to be evicted. All they do is take up space on your Money Machine (Menu). They need to go away.
Take a look at your food category reports from your POS and do it with a business mind. You will be shocked to see that some of your favorite personal items (i.e. the potato skin stuffed with caviar and foie gras) only sold 16 in a 12 month period. But you will also find that the quesadilla with grilled chicken, three types of grilled onions and roasted pepper aioli, sold 1287 in a 12 month period. Those numbers (diehard facts) are your guests speaking to you. So, lose the skins. You need to make decisions based on the numbers – the bottom 20% always needs to go away. The middle 60% will eventually create a bottom new 20%.
Therefore, the next time you put an item on your menu because you love it, give it the test and see how it fares.
See you in Season 3 of Bar Rescue beginning on February 10, 2012!