MED201: Business Report on Menu Engineering and Design Analysis

This business report, designed for MED201, delves into menu engineering as a critical tool for maximizing profits within the culinary industry. It examines menu engineering as a marketing-oriented approach, focusing on menu design, content decisions, and pricing strategies to optimize profitability. The report further analyzes the significance of stock control procedures and stocktaking in minimizing food wastage and controlling costs. The report highlights the importance of correct stock par levels, emphasizing their impact on business success and efficient inventory management. The report also provides an overview of menu engineering matrix, outlining key components such as popularity and profitability to categorize menu items into 'stars,' 'workhorses,' 'puzzles,' and 'dogs'. Furthermore, it discusses the benefits of effective menu engineering, including track records and easily traceable results. The report concludes by emphasizing the role of menu engineering in increasing profit margins and the continuous monitoring required to ensure its effectiveness. The report also explains the importance of stock control for culinary professionals to reduce food wastage. The report provides a detailed overview of menu engineering and stock control in the hospitality industry.

Assessment 2 –
Case Analysis/Business Report
MED201 Menu Engineering and Design
Student Name:
Submission Date:

Table of Contents
Introduction................................................................................................................................1
PART – A...................................................................................................................................1
Menu engineering as an effective management tool..............................................................1
PART – B...................................................................................................................................2
Stock control & Stocktaking..................................................................................................2
Importance of both in controlling food wastage and costs.....................................................2
Significance of having correct stock par levels and its impact on success of business..........3
Conclusion..................................................................................................................................3
REFERENCES...........................................................................................................................4

Introduction
Professionals involved in the culinary business are required to design profitable
menus for various types of food service styles and cuisines. Pertaining to thus, menu
engineering is now becoming a standard practice for all sophisticated restaurants who are
seeking to have maximum amount of profit from their menu without letting go the quality of
their products and services (Morrison, 2006). The current business report also focuses on
menu engineering as an effective tool for maximizing profits and will analyse stock control
procedures and tools being used by culinary professionals for controlling cost.
PART – A
Menu engineering as an effective management tool
Speaking in relation with menu engineering, it is a marketing oriented method for
analysing the current as well as future menu design, content decision and menu pricing. It is
quantitative model being designed for offering a base for evaluating the success of the menu
in relation with attracting customers and profitability. Profitability of the menu of different
types of dishes determines the effectiveness of menu engineering (Blokdyk, 2018). Further, it
pays attention on three major components i.e. total number of customers served, number of
items sold from the menu in a given time and finally, profit for each menu item. In addition to
this, for hotels and the restaurants, menu engineering offer irrefutable benefits other than
increasing profits such as track record of effective menu engineering, effective decisions
dependent on decisions and easily traceable results. Moreover, it also provides a way of
refreshing the menu to restaurants without having any fear of trailing profits.
In regards with hospitality industry, the simple objective of menu engineering is
increasing the profits per customer at any restaurant. Hotels and restaurants can achieve this
by cautiously evaluating the profitability as well as attractiveness of each menu item along
with placement of item on the menu for motivating customers to select a specified dish.
Figure 1: Menu engineering Matrix
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(Menu Engineering for Your Restaurant, 2016).
First of all, it is quite vital to evaluate each and every item being sold in a given
period of time. Further, each item is than plotted on above scattered diagram by the category
of menu item. The vertical position of the plot for menu item is dependent on the profitability
of unit of sale and horizontal position of the plot is based on percentage of unit sold or
popularity of each menu item (Noone & Griffin, 2009). The above scattered diagram
categorises the menu items into 4 quadrants for analysing the success of the menu:
 Stars – Items which are both popular and have high gross margins
 Work horses – Items which are popular but have lower gross margins
 Puzzles – They are less popular but generally have higher profitability
 Dogs – These items are have lower level of popularity and gross margins
It is essential for the firms to determine the items which can be boosted for improving
the popularity as well as opportunities for improving margins by reformulation of recipe or
through increasing the price to match up with the market values. Furthermore, it is vital to
reject the menu which does not perform and attention should be paid on items which are
popular and also have high gross margins (Bowen and Morris, 2005). Thus, menu
engineering is not ending rather an on-going process. Hospitality industry can increase their
profit margins by implementing menu engineering. It is vital and crucial tool which can be
utilized by each and every hotelier and restaurateur for increasing their profitability.
However, one of the most destructive gaffes is spend time on engineering a menu and have it
ineffective over time. Therefore, it is essential to monitor menu continuously to ensure that it
does not lose soul of the restaurant and sight of the heart.
PART – B
Stock control & Stocktaking
Speaking in relation with stock control, it is nothing but a practice by which the
requirement of maintaining stock levels against its costs can be balanced. On the other hand,
stocktaking includes counting all the stock physically and matching the same with the stock
records for noticing any incongruities.
Importance of both in controlling food wastage and costs
With effective stock control, firms can have right number of stock at right time and
place. Furthermore, it also makes sure that the capital of the firm is not tangled pointlessly.
For example, culinary professionals can make use of just in time production system in which
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products are made only when it is demanded which in turn minimizes the inventory
investment. In addition to this, it also helps in reducing the number of products being
provided. Other than this, minimum stock level can be used for determining a least stock
level and re-ordering the stock when it reaches to that level (Ojugo, 2009). This will help the
culinary professionals to reduce the amount of food wastage. For illustration, inadequate
work station stocking prior peak period as well as poor storage of food can cause anxiety in
the middle of the session. Because of this, there will be panic ordering without considering
the price and leading to potential spoilage as well as overstocking.
Significance of having correct stock par levels and its impact on success of business
Talking in relation with the par level, it is being referred as an inventory management
approach by which the hoteliers can identify the minimum amount of stock that needs to be
maintained. If the number of stock decreases from the par level, it means that specified stock
needs to be ordered more (Stock control and inventory, 2018). There are many reasons
behind having correct stock par level at all the times such as it helps in reducing spoilage,
support in keeping inventory turnover rate under control as well as healthy, reduces food
waste and finally, minimizes foo costs. Par levels help the firms to run their businesses at an
optimal level.
Conclusion
Thus, to conclude it can be said that menu engineering is very crucial for the success,
effective operation and higher profits for the firms operating in the hospitality industry.
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References
Blokdyk, G. (2018). Menu Engineering: Standard Requirements. CreateSpace Independent
Publishing Platform.
Bowen, J.T. and Morris, A.J. (2005). Menu Design: Can Menus Sell?' International Journal
of Contemporary Hospitality Management, 7(4), 4-9.
Menu Engineering for Your Restaurant. (2016). Retrieved from
https://djubo.com/blog/menu-engineering-restaurant/
Morrison, P. (2006) 'Menu Engineering in Upscale Restaurants. International Journal of
Contemporary Hospitality Management, 8(4), 17-24
Noone, B. & Griffin, P. (2009). Managing the long-term profit yield from segments in a hotel
environment: A case study on the implementation of customer profitability
analysis. International Journal of Hospitality Management, 18, 111-128.
Ojugo, C. (2009). Practical Food and Beverage Cost Control. 2nded. Cengage Learning.
Stock control and inventory. (2018). Retrieved from
https://www.infoentrepreneurs.org/en/guides/stock-control-and-inventory/
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