Menu Development: Planning, Design, Costing, Pricing & Profitability

This report focuses on menu development, planning, costing, and pricing strategies for restaurants, particularly referencing the Fat Duck Restaurant. It identifies key considerations for costing and pricing menus, including competitor prices, equipment costs, labor costs, food quality, and legal factors. The report analyzes different approaches to menu costing and pricing, such as potion cost pricing, raw food cost pricing, and competitive pricing, to maximize profitability. It outlines a realistic plan for menu development, emphasizing the importance of understanding customer needs, conducting surveys, and gathering feedback. The report also discusses the use of Key Performance Indicators (KPIs) to test and evaluate the menu's success, including marketing KPIs, probability KPIs, and customer feedback. Furthermore, it provides recommendations for improvement based on menu testing and evaluation, such as hiring professional staff and monitoring market trends. The ultimate goal is to develop a menu that meets customer and business requirements, maximizes profitability, and aligns with the overall business objectives of the chosen organization.

Menu Development,
Planning and Design

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 2............................................................................................................................................3
P3 Determine the key considerations which need to be taken into account when costing and
pricing menus.........................................................................................................................3
P4 Produce accurately costed and priced menus to meet a range of customer requirements 4
M2 Analyse approaches to menu costing and pricing and use effective methods to accurately
cost and price menus to maximise profitability......................................................................4
TASK 3............................................................................................................................................5
P5 Produce a realistic plan to develop a menu which meets customer and business
requirements to maximise profitability for a chosen organisation.........................................5
P6 Produce a menu which meets customer and business requirements to maximise
profitability for a chosen organisation....................................................................................6
P7 Test and evaluate the menu produced...............................................................................7
M3 Produce a realistic menu using a fully researched and costed plan that meets the overall
business objectives of a chosen organisation.........................................................................8
M4 Make justified recommendations for improvement based ontests and evaluation of the
menu.......................................................................................................................................8
D2 Produce an in-depth plan for menu development, including KPIs to measure success
produce and test the menu, making justified recommendations to resolve problems identified
to meet overall business objectives of a chosen organisation................................................8
CONCLUSION ...............................................................................................................................9
REFRENCES.................................................................................................................................10

INTRODUCTION
The aim of this report of this report is to identify the different types of key consideration which
need to take into consideration while costing and pricing the menu. It is very important for the
management of the restaurant to identify some cost management techniques to set the prices as
per the need of the customers and market (Akademisk, 2022). This report also covers the plan to
develop the menu and the methods to test the menu procedure of Fat Duck Restaurant. In
addition to this KPI methods are also covers in this report.
TASK 2
P3 Determine the key considerations which need to be taken into account when costing and
pricing menus
It is significant to design the menu accurately and properly. It's important to check the price so,
that the client finds it reasonable. When designing a menu, restaurant need to consider the cost to
develop the best menu. The product needs to satisfy the customer's taste and quality so that they
feel that the which are paid by them is worthy. Following are the different types of factors which
need to consider when pricing the menu:
 Competitor Prices: comparing the prices with rivals and modifying menu prices is very
important because the restaurant can achieve margins and attain the customer satisfaction
by checking the market prices of competitors. Market prices of competitors is checked by
the Fat Duck so, that they are able to offer the similar products. This will increase brand
awareness.
 Equipment: The price of food materials is greatly influenced by the consumption of
materials. The Fat need to use those equipment’s which assist them to reach the target
market, sales contribute towards the success of the restaurant (Begley, Paynter and
Dhaliwal, 2018).
 Labour costs: Labour costs maid a huge effect on the quality of restaurants and products.
The Fat Duck employs the best skilled workforce to make sure that quality products
offered to customers. Restaurants should not negotiation on the employment and cost of
workers, as customers prefer the highest quality and workers offer that quality.

 Food quality: Food quality is a major concern for all customers. Therefore, when it
comes to menu costing and pricing, Fat Duck should calculate based on its quality. High
quality food items need high quality ingredients, which can be expensive to cook.
 Consideration of legal factors: Law plays an important role in deciding prices and costs.
The restaurant cannot ask for the price whatever they want. Customers should not be
exploited in accordance with consumer law. The billing price should be reasonable to
meet the needs of the customers (Benvenuti and et. al., 2019).
P4 Produce accurately costed and priced menus to meet a range of customer requirements
M2 Analyse approaches to menu costing and pricing and use effective methods to
accurately cost and price menus to maximise profitability
There are several methods that can help to determine the cost and price of the menu.
These approaches show how to effectively secure prices in accordance with legal law. This assist
in gaining lots of profit and helps in becoming a market leader.
 Potion Cost Pricing: This is an effective approach to pricing. Therefore, the pricing is
done by separating the standard part of the product (Cranfield, 2020). The cost should be
calculated proportionally.
 Pricing by raw food cost of the item: This is being considered as one of the most
common approaches and contains the raw materials cost and food that goes into

production. This can be recognised by dividing the cost of raw food by the cost of the
wanted food to obtain the final price.
 Competitive pricing: The price needs to be calculated by analysing the competition in
the market. Restaurants can look at competition, calculate prices, observe their behaviour
and change prices. Fat Duck restaurants must charge the same price as their competitors
charge. The hospitality industry has had a huge impact on restaurants. Competitive prices
are a better way
TASK 3
P5 Produce a realistic plan to develop a menu which meets customer and business
requirements to maximise profitability for a chosen organisation
It is very crucial that the menu plan is required to fulfil the customer need. The main motive
of the respective organization is to attain the highest profitability standards for expansion to all
across the globe. The firm key role is to provide great, healthy and delicious food to meet the
needs of various customers. The steps to create the realistic menu has been discussed below: -
 Developing Menu Concepts: This is the first menu development plan. First, need to
determine what products and services the restaurant offers, and what they are well-known
for. The presence of unique sales proposal that defined a particular taste and texture of a
company's food items (De Menna and et. al., 2018). The Fat Duck Restaurant must have
to define the taste in the market in which they are specialize. This makes it easier for the
Fat Duck restaurant to win in the market.
 Needs defined: Restaurant can easily create menus by analysing their needs. within the
United Kingdom, different types of dishes are in demand, such as Italian, Continental and
Indian cuisine. The Fat Duck Restaurant have to make all decisions efficiently in order to
achieve high profits. This gives assistance to set clear goals and goals in the target
market, people can see the most searched dishes in menu of restaurant.
 Do a Survey: in order to develop a realistic plan Effective research is needed. The Fat
Duck is obliged to do a proper investigation of customer. With the help of social media
platforms, feedback from customers and online surveys this can be done. It provides
insights into current trends, price competition and changes related to the organization.

 Create and present: after completing the research, the restaurant needs to develop a
menu and present it to the market within a specific time period (MeriSafarwati andSiti
Chairiyah Batubara, 2021). The Fat Duck restaurants have to present their food in an
attractive way which catches the eye of customers and makes people hungry.
 Get Feedback: Feedback plays an important role after the menu is designed and made
available to customers. This indicates whether the customer likes food or wants possible
changes. All feedback needs to be considered to bring out changes in the designs and
dishes.
 Set Pricing: the next is, Fat Duck need to set up a pricing strategy to attract clients.
When designing a new menu, the restaurant must be competitive yet affordable to their
customer. This balances the market threat with the restaurant's internal functions. In
addition, the price should be evaluated according to the product specifications.
P6 Produce a menu which meets customer and business requirements to maximise
profitability for a chosen organisation
The restaurant organizes its menu by recognizing all the basic principles. The price, food,
and ingredients that follow are showed, menu changes are frequent. Since the restaurant sell
Ficus in accordance with demand of customers and the Industrial Safety and Health Act, the
menu must not contain dishes that may pose a customer health problem (MitchellAmez,
Drozand Parsons, 2020). The Fat Duck Restaurant aims to develop a high position after the
Covid19 pandemic and to consider the health of people. Here is a well-prepared menu:

This menu contains all the basic food items that are most popular with the British people.
This menu is determined by incorporating feedback after analysing customer demand, trends,
competition and prices.
P7 Test and evaluate the menu produced
It is very important to analyse the menu of the hotel which is produced. There are some
correct key performance indicators which helps them to determine if their menu become
successful in the market or not. By evaluating the hotel menu, the management of the restaurant
can know the profit status of the company. Differences can only be found by utilizing the proper
structure for a successful menu. A continuous review of the menu will help Restaurant manage it
in a proper way. The Fat Duck Hotel uses the following elements to review the menu:
Key Performance Indicators and Benchmarks: These factors assist the restaurants to improve
their performance and reach their goals. These indicators help them to measure the growth of the
restaurant and how it meets the needs and desires of customers (Mun and Jang, 2018). A
continuous review of performance helps the company get off the ground. This also give
assistance to understand how long it takes to attain growth opportunities. The KPIs used by The
Fat Duck Hotel are:
 Marketing KPI: this indicator is utilized by The Fat Duck Hotel in order to measure the
entire success of the menu. Social behaviour as well s engagement among the workers
and consumers are monitored in this which assist the firm to learn about the social
commitments. This also helps them to identifying the traffic came on their websites and

followers on the social media platform. This help companies achieve greater profit and
success in the future.
 Probability KPI: The key point of a company is profit, and this indicator assist the
company know gross profit and net profit. It five assistances to the company to know that
the profits are enough.
 Customer Feedback: This is another way to KPI. It is very important that an
organization receives feedback from customers, employees, and managers. It is important
for Fat Duck's to recognise key business needs (Shangguan and et. al., 2019). On social
media platforms, restaurants get accurate review.
M3 Produce a realistic menu using a fully researched and costed plan that meets the
overall business objectives of a chosen organisation
Menu planning plays an important role in achieving business goals that enable a firm to
maximize the profitability of its business. Prices and food types are an integral part of the menu
and must be clearly indicated by the restaurant. With respect to Fat Duck, the dishes and costs of
dishes scheduled by the management will be considered below.

M4 Make justified recommendations for improvement based ontests and evaluation of the
menu
Menu testing and ratings show that the firm needs to collect ratings and feedback from
customers on a regular basis. Through regular testing and evaluation, the restaurant receives new
ideas and changes. As a result, Fat Duck restaurants need to be improved in the following ways:
• Business requires hiring professional staff with extensive knowledge and ability of menu
design. Staffing needs and competition need to be identified so that all criteria are easily
met.
• Companies need to regularly monitor market trends and come up with new ideas for menu
colours, themes and flavours
D2 Produce an in-depth plan for menu development, including KPIs to measure success
produce and test the menu, making justified recommendations to resolve problems
identified to meet overall business objectives of a chosen organisation
It is important that the restaurant implements an effective plan for menu development and
use the menu subsection to add a picture of the dish and mention the price with a currency
symbol etc. By regularly analysing the performance of the menu with the help of KPI, the
restaurant can analyse the dish with the least orders from the customer and the restaurant can
exchange it for other foods to attract the customer's attention (Toledo, Alzahrani and Martinez,
2019). The main problem facing restaurants is related to the stylistic and promotional price
analysis of the product. Therefore, it has been recommended that Fat Duck restaurant have a staff
member who will explain the details of the menu.
CONCLUSION
From the above report it has been concluded that by developing effective and attractive
restaurant menus, the restaurant can achieve high customer satisfaction and further increase
profitability. This report concluded that there are different types of key consideration the need to
paid focus while designing the menu. This report also produces a menu according to the
customer requirements and also concluded the approaches to menu costing in order to maximise

the profitability. This report also concluded the procedure of developing the real menu and
methods to test the menu procedure.