Strategic Menu Engineering
At Czar Metrics, we look beyond pricing with our advanced menu engineering approach. Adding demand curves, substitution effects and cross-elasticity to the traditional approach to menu engineering results in a powerful profit-generating tool for restaurateurs. Our methods drive menu strategy - including R&D parameters, layout and merchandising for optimal profit, product gap identification, pricing and bundling.
We evaluate your menu through 4 critical filters:
- How will this affect the Brand? (brand defining, value perceptions, craveable flavor profiles, memorable items)
- How will this affect the Guest? (influence buying decision, reinforce loyalty, improve frequency, etc.)
- How will this affect us Financially? (ability to afford, generate profit, increase/decrease costs)
- How will this affect Operations? (Ease of execution, skill training, cook times, etc.)
Smart Pricing maximizes profit with strategies for the right price on the right items in the right locations.
- Product Price Elasticity
Identifying the best prices for products based on demand measures, and points of resistance. This can be applied across any menu, including wine lists. Another insight is the ability to measure points of resistance on total per guest spend.
- Product Cross-Elasticity
Identifying how all products on the menu are affected as a consequence of raising or lowering a single price is essential in providing a holistic guide to pricing that encompasses product inter-relationships.
- Market Basket /Substitution Analysis
Understanding how item demand shifts in tandem with or counter to other products allows us to make actionable recommendations on product bundling and product promotion. Understanding this dynamic over time and as seasonal or limited time offers come in to play helps capture the unique rhythm of your demand and profit flow.
- Advanced Menu Engineering
Adding demand curves, substitution effects and cross-elasticity to the traditional approach to menu engineering results in a powerful profit-generating tool for restaurateurs. Our methods drive menu strategy - including R&D parameters, layout and merchandising for optimal profit, product gap identification, pricing and bundling.
We evaluate not only the prices on the menu but also your product offerings. Joining in-depth analysis with an understanding of your core product offerings we reveal:
- Which items are the most popular AND profitable to your bottom line
- Which items you should highlight to drive sales to increase overall profitability
- Which items should be eliminated or retooled for profitability and increased popularity
Menu Layout and Design
With the financial criteria determined, the process culminates in a menu design that is:
- Designed for profitability via the overall menu design and structure (# of panels and folds, ability to highlight and feature items).
- Laid out on a category basis to steer customers to profitable and brand defining categories.
- Designed to encourage profitable purchase behavior within the categories.
- Designed with a balanced approach to featuring items that are brand defining, high quality, easily executed and popular with guests as well as profitable.
Location Based Pricing
Not all locations are created equal and neither should your pricing strategy. We use advanced analytics to group your locations into tiers and then recommend custom pricing for each tier. This approach provides optimal pricing for each location that will drive customer sales and bottom line profit. Learn More.
New Product Introduction, Impact and Pricing
Our approach to new product forecasting can accommodate early stage demand estimation, all the way through live testing and full system rollout. We accomplish this by using a variety of survey techniques (including Delphi technique) during the early stages of product identification, all the way through the use of advanced econometric processes that allow us to project product demand and identify the cannibalization and incrementality of a given product. When media support is used to launch the product, forecasting becomes more challenging and more critical from a marketing, operations, supply chain and revenue standpoint.