How do you increase your profits without raising prices or guest counts? No, this isn't the riddle of the month, it's the business of Greg Rapp, a restaurant consultant who specializes in Menu Programs. According to Rapp, the secret to increased profits is on the menu. After getting a degree in Advertising from Washington State University in 1982 (with a minor in Hotel and Restaurant Administration), Greg began The Menu Workshop, teaching hotels & restaurants how to improve profitability through better menu design. He now offers clients a "Menu Profit Makeover", guaranteeing a $1,000 per month increase in profits or your money back! And he's worked with some pretty impressive clients – Wolfgang Puck's Spago, Caesar's Palace, Taco Bell, Disneyland and the Broadmoor Hotel, just to name a few.
Recently, Rapp has begun working specifically on pizza menu programs. While many of the basics of "menu engineering" are the same as for any restaurant, Greg is quick to point out that pizza is "a whole different animal." Figuring the gross profit for each and every menu item is the first step for any restaurant, but pizza restaurants must also look at their gross profit per person. Greg notes that engineering the most profitable menu possible is a lot of work, but it's well worth the effort. He has no qualms about guaranteeing a $1,000/month increase in profits because, as he says, "it's not a lot when you start looking at the opportunities your menu has for you.
A customer's eye tends to travel in the order indicated above.
Place your most important information where it is most likely to be seen.
Rapp's menu designing begins with a system of indexing each and every item a restaurant sells. He puts each item on an individual index card with its selling price. Then he sets about figuring out the cost of each to the restaurant. Here's where the hard work comes in, but as Greg points out "you never know anything until you go through this process." once you know what an item costs, you subtract the cost from the selling price and you have the gross profit for each item on your menu. Rapp stresses doing this for every item that includes individual toppings and beverages (it you offer "bottomless" sodas, then you need to know the average number of refills per person). Now arrange the cards by profit from highest to lowest and Rapp expects you'll probably be surprised at which items end up on top and which end up on bottom. Now, for pizza restaurants, the work's not done. A second list must be compiled from highest to lowest by profit person. For this list, the gross profit of each item is divided by the number of people that item feeds. For instance, if your extra large pepperoni pizza has a gross profit of $15.00 and it feeds five people, then it's profit per person is only $3.00.
At this point, Rapp puts each of your menu items into one of four categories: stars are your high-margin, high-volume items; puzzles, leave the plow horses and get rid of the dogs. Use color and copy to highlight the stars and puzzles (which can often be turned into stars with a little push). Remember, Rapp says, "the more copy an item has the more important it looks." Push your plow horses to the bottom of the menu, you don't want to highlight these but neither do you want to get rid of them and run off customers who expect them. Only the dogs can go.
Two more extremely important menu design aspects, which Rapp demonstrates in his Good Menu/Bad Menu examples, are "leader dots" and dollar signs. Leader dots are those…..that lead the readers' eyes from the menu item to the item's price. Using leader dots creates a "price list." feel to your menu and worse, it essentially forces the reader to shop by price instead of by item. Put the price at the end of the item's copy, and don't highlight it with a different or bold font–if price is of interest to your customer, they'll find it. As for dollar signs–never use them–they only remind people that they are spending money. Generally menus should always be laminated to avoid the common perception that paper menus are "dirty.
Rapp has some creative tips and suggestions specifically for the pizza industry. He notes that some of the most profitable items can be extra toppings. According to Rapp, staff should be trained to listen for the customer who is ordering their pizza toppings "a la carte" and to suggest additional toppings that go well with their other items. Onions, for instance, come in at the top of Rapp's extra toppings profit lists–they're dirt cheap but priced the same as other topping. While Rapp notes that "it's hard to push an onion pizza", it's not hard to suggest onions as an addition and every topping pushes your profit margin up.
Also, have fun with your menu and your pizzas. Create specialty pizzas that are high in profit and set about describing them in a way that them a little "personality". For example, names like Big Bobs, Hunger Buster, or Party Lovers Pizza help build product identity. Rapp has had success creating "competition" between pizzas–making them entities unto themselves and creating excitement around them (give them their own logos, create T-shirts, put them on delivery vehicles).
Rapp knows that it always seem that there are a hundred things to do and at least ten of them seem more important than revising your menu, but he's also certain that your menu holds the key to increasing your profits–by at least $1000, a month. This menu guru's not afraid to put his money where his mouth is either. If you're interested in Greg's guaranteed Menu Profit Makeover, then give him a call at 760-323-4848. What have you got to lose but an extra $1,000 a month in profits?
Greg Rapp of Rapp Consulting continues to work with small and large restaurant clients from his home in Palm Springs. If you'd like to contact Greg, his address is 2340 Southridge Dr., Palm Springs, CA 92264, phone number: 760-323-4848, Fax: 760-416-9595.