Menu Development, Planning and Design: Costing and Pricing Report

This report provides a comprehensive analysis of menu development, planning, costing, and pricing within the food and beverage industry. It emphasizes the importance of considering various factors for successful menu strategies. The report highlights key considerations such as understanding customer preferences, calculating menu item costs, and accounting for VAT. Furthermore, it delves into profitability planning and the use of food cost percentages as a crucial tool for effective menu pricing. The conclusion summarizes the critical elements involved in accurately costing and pricing menus to optimize resource allocation and enhance profitability. The report references several academic sources to support its findings and provides a structured approach to menu management.

Menu Development, Planning and design

Table of contents
• Introduction
 Determination of the key considerations which need to be taken
into account when costing and pricing menus
 Accurate costed and priced menus to meet a range of customer
requirements
• Conclusion
• References

Introduction
Food and beverage service business has to deal with various
factors and external functions in order to be successful at the
market with in best business strategies. Manager and directors
have to continuously manage their business strategies and
operational functions according to the changing environmental
factors and business plan.

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Such as in the case of menu modification for more customers
satisfaction and higher profit, organisation have to do many more
other functions along with the menu planing and implementation,
such as they have to effectively consider the profit influencing
factors which planing for menu pricing. In this report different
factors are explain which has to be consider under menu pricing
process along with the development of menu price costing.

Determination of the key considerations
need to be taken into account when
costing and pricing menus
Food service business is not that much easy its require the huge planing
and functions for effective business structure, culture and facilities,
which can help the organisation to attain their business objectives.
In order to achieve the higher profit business objectives organisation
need to consider the various factors during their menu pricing
process. Some factors are given below which should be consider by
the selective organisation.

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Costumers preference-
Most important factor which should be consider before pricing, is the
situation and needs of the target customers related to product's cost. That
is very important to asses and consider the customers demand related to
pricing, along with this price rate of competitors menu. Because lower
price rate requirement of customers and lower price rate product menu of
the competitor can negatively impact the organisation menu planing.
This can lead to the loss of customers, so in order to reduce this risk
organisation have consider the customer preference in menu.

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Calculating Menu Item Costs
Once the custom's requirement is considers then next factor which
should be consider is costing of the each ingredient and assets use
for the preparation of newly selected menu dishes.

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VAT
Value added tax is important to consider while planing for the menu
pricing because they have to collect this from users in order to pay
it into the government authorities. This is the type of tax charges
apply on the resource's users of the nation. This tax is apply at each
stage of the business's functions such on production, distribution
and sale. It has to be consider while costing menu price in order to
select the right MRP with the selection of appropriate profit margin.

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Profitability-
After the consideration of all other factors, another most important
thing which has to be consider in pricing process, is selection of the
appropriate profit earning and margin strategies. This can be
effectively manage by Food Cost Percentages.

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Food Cost Percentages
This is the type of pricing tool which help to effectively cost the each
menu dish with in the consideration and calculation of staff cost,
resource's cost, revenue, profit and fixed cost percentages. So that's
why this is important to consider or use while pricing the menu.