Most Lucrative Restaurant Pricing Strategies for 2022
Apart from your beautiful restaurant’s ambiance and customer service, the menu you hand to your diners is one of the first few things they experience at your establishment. Hence, it must conform with the style and quality of your restaurant, follow your theme, and most importantly, make it easy for customers to choose what they want to eat.
That’s not all; your menu is your most powerful tool to advertise your restaurant and make profits. After all, you need to make money to stay in business. A menu is the embodiment of your restaurant pricing strategy. Yes, choosing the correct menu prices is important, but presenting them the right way is essential.
Read on to find out all about choosing the right restaurant pricing strategy to make handsome profits. You’ll also get some bonus tips on designing a menu that pleases the eye and stimulates the appetite!
Top 5 Restaurant Menu Pricing Strategies For 2022
Getting your restaurant pricing strategy right means the difference between a profitable business and one that’s not doing very well. It should be an integral part of your restaurant management. Apart from following textbook menu pricing strategies, you’re recommended to research to determine the most suitable profit-making prices.
Evaluate competitor prices, the customer demographic you serve, and how popular your restaurant is at the moment to make the right decision.
This is one of the most straightforward, tried-and-tested restaurant pricing strategies that restaurateurs have been using for a long time. If you want a quick solution for your prices, go for this one. Yes, it will take some time to calculate tentative costs and set profit margins, but the cost-based approach in this strategy makes things simple and reasonable.
In this pricing strategy, your prices depend primarily on your costs for delivering a service. These include the cost of raw materials, labor, seating, décor, maintenance, and other miscellaneous expenses. This covers essentially everything that goes into providing the restaurant service to customers.
The next step is to add your profit margin. The profit margin is a percentage of the actual cost of a dish, so the profit you earn on one dish depends on what that dish costs. The profit margin is higher for high-end restaurants and lesser for quick-service cafés.
Once you’ve determined a fair estimate of how much it costs to serve a particular dish, add your profit margin to it, and you’ll have a reasonable price you could put on your menu.
Try Out Triple Pricing
Triple pricing strategy has remained the old, reliable, and profitable pricing method for restaurants and other businesses. This involves marking the price for one product and pricing better versions at a higher price.
Also known as “good, better, best” pricing, this strategy involves arranging products in trios with the ‘good’ being the cheapest and the ‘best’ being the highest-priced with complementary side dishes or drinks.
Here comes an essential piece of customer psychology, it has been reported that the middle price or ‘better’ option always sells more than the other two. To capitalize on this, you ought to make the profit margin for it the heaviest of the three.
Charge Less for More Quantity
If there’s a lot of competition for the type of food you offer in your area, you might want to gain a competitive advantage by providing more food for less money. This pricing strategy focuses on the amount of food you serve to your customers. It should be your go-to if you are not a premium restaurant and offer everyday food.
A majority of your customers probably come to you looking for value. If you succeed in winning their hearts by serving more food than a competitor for the same price, they will become regular visitors. And therein lie your profits. So rather than earning a more significant profit once, this pricing strategy allows you to earn a lesser profit but multiple times from the same customers.
Charge More for Special Cuisines
The type of food your restaurant offers is a cornerstone of your menu pricing strategy. For example, if you’re marketing a fast food, your average customer is someone who’s looking for something tasty to fill up their tummy and something that’s light on the pocket. Hence, fast food restaurants should always cost less.
On the other hand, if you’re offering an exotic cuisine like Palestinian or gourmet Italian food, you are a premium restaurant and should charge accordingly. Don’t make the mistake of following a cheap pricing strategy for a premium quality restaurant. High prices reassure your customer that you’re serving them food made by gourmet chefs with the highest quality ingredients.
Add a Chef’s Special on Each Page
Customers are always looking for something unique and exclusive that they can’t have at any other restaurant. Adding a Chef’s Special Dish on each page or section of the menu will motivate them to spend a bit extra to try out one of the best dishes in the house.
Don’t add the words ‘Chef’s Special’ before any dish and start charging higher for it. It would help if you made it look and taste better, too, so customers receive the value for the money they pay.
3 Ways to Design a Profit-making Restaurant Menu
Prices are mere numbers. You need much more than that to develop a profitable menu for your restaurant. For example, you need to learn how to help a customer absorb the information as efficiently as possible as they scan your menu, and you do that with colors, design, and creativity.
With the following tips, you don’t need to hire anyone to create a menu for you. Instead, you can do so online with Desygner and choose the colors, design, font, and formatting yourself for the best results.
1. The Lasting Impression
Use a bold, statement-making cover for your menu. The cover and the first few pages tend to make a lasting impression on the customer’s mind. Moreover, the first and last few dishes on every page are bestsellers. Take advantage of this by placing your high-profit dishes in these positions.
2. Don’t use currency symbols
Unless your customers need to know what currency you use (for instance, if your restaurant is at an airport), you should stay away from placing currency signs next to prices. Putting a $ or a £ next to the price makes customers focus more on the price, making them more likely to purchase cheaper items.
3. Mention price after the dish description
A well-written description is a short window you have to convince your clientele to buy even the most expensive dishes you offer. However, if the description manages to make their mouth water, customers are very likely to purchase, no matter the price. Hence, place prices at the end of the description so that a high price doesn’t dissuade a customer.
The Bottom Line
You can find some pretty amazing price lists and menu templates on Desygner. If one of these fits your restaurant style, you can prepare your bespoke menu in just a matter of minutes. Of course, you can always tweak the colors or fonts to make it a perfect fit.
Creating a good enough restaurant pricing strategy and menu can seem like a pretty daunting task initially. But now that you’ve read this guide, you’re ready to create a stellar menu that will start making you profits right away!