Vince Barrett, VP of F&B for New Castle Hotels & Resorts in Shelton, Connecticut, discusses with Hotel F&B the mechanisms behind his company's automated, highly successful process of menu engineering.
How does your menu engineering work?
Menu engineering has been around for a long time; we've had it at our property for more than 20 years, but now it's automated. You plug in each menu item, how many are sold, the food cost, and retail cost. The algorithm creates the profit contribution, which identifies the average check and average customer demand, and where those two points intersect lies in one of four quadrants. The upper left-hand corner is a plowhorse, with tremendous demand but less profit contribution; upper right-hand is a star, with above-average demand and profit; lower left-hand is a dog, with low demand and profit; and lower right-hand is a puzzle, with high profit but less demand. We do this procedure every 90 to 180 days, depending on the property, with the food menu as well as wine and beverages.
What are its benefits?
It takes the emotion and ego out of the menu; the numbers talk to you. It helps you manage the decision process, reduce waste, manage the menu more effectively, and evaluate new items. The chart gives a snapshot of the menu and guest habits. It helps you make more intelligent decisions-if you should lower or increase a price, change the location on the menu, or alter the recipe or portion sizes. Having that data makes your decisions more proactive and intelligent versus emotional and reactive.
What data entry is required, and who collects and evaluates the data?
All of the data is on-property, with 90% in the POS system. You determine the time frame you want to run the report on menu item analysis. You take the information from each category-soups, salads, entrées, desserts-rather than combining all into one report. The other 10% is making sure the menu items are costed and have recipe cards and plating specifications.
What is the cost to implement the program, and where is the information stored?
The cost of the program is internal. We used our in-house programmers, so I couldn't put a number on it-perhaps $2,000 to $3,000. I haven't seen anything you can buy off the shelf. The menu engineering sits on the property's networking server. The F&B manager and executive chef to go through the process, and we at the corporate level have reminders for each property. I also oversee every property once yearly when we go through the budget process, and I'm kept in the loop with the menu designers. In our 23 hotels, 21 are using menu engineering. The other two serve only free breakfast.
What kind of culture change is necessary to stay on top of the process?
We used to do this manually on spreadsheets, which was a failure because no one had time. Being automated, we can run the reports and dump the data in two hours, versus three or four days, and make immediate decisions. People must be trained to understand how it works. We put them on a schedule, and once the system is in place, it's pretty routine. We build it in into our budget and cultural process.
Do you feel some areas of the menu are often overlooked?
I think the positioning of items on the menu gets overlooked. That's why we've developed a collaborative team; involving people outside the property gives you a different perspective. People probably won't order things stuck in the lower corner. Make sure the entrées you want to move are in the line of vision when guests open the menu.
What red flags indicate a menu needs to be entirely overhauled?
If people are buying more specials than menu items, you know the menu is kind of boring. If you have 20 items on your menu, and only two are stars, you have problems. If you find that a third or more are dogs or puzzles, you missed the mark and probably have to revamp the whole menu. When that has happened, we developed menu surveys for guests with categories such as meat, poultry, seafood, appetizers, and salads and asked what they'd like to see. From that data, we figure out if the problem is with menu layout, menu items, or something else.
What examples can you give of successful menu changes?
Our Hampton Inn in Jekyll Island, Georgia, was the first to install a bar/lounge in a Hampton. We started off with eight or nine basic items, including chicken wings and a flatbread. We assumed we'd do maybe $100,000 yearly; today, that 14-foot bar generates $440,000 yearly in food and beverage-about $30,000 per stool. Through engineering and listening to the guest, we now have a menu with 20 to 25 items rolled out last August that's kicking butt.
The Westin Jekyll Island opened in April 2015, so we just did our six-month review and implemented a new menu, with about 20% to 25% changes based on menu engineering. We altered how the menu was positioned; we had built the menus with specialty items that were complete meals and a section where guests could build their own. We saw people leaning toward the complete meals, so we expanded the specialty items and needed fewer of the à la carte items. About 8% of the menu was dogs, so we removed those. We made the most popular à la carte combinations into specialty items. This new menu is doing pretty well, and we'll review again in 60 or 90 days.
Do you have tips for other properties looking to implement menu engineering?
Inspect what you expect and hold your team accountable. If you don't follow through, you can lose a lot of money without realizing it. If your menu is underperforming, you may think you're successful while leaving tens of thousands of dollars on the table. This is a great tool to manage menus to be effective, efficient, and profitable, but you have to be disciplined. Tracy Morin is a freelance writer and editor based in Oxford, Mississippi.