How Menu Engineering Increases Restaurant Profits

Increase restaurant margins - your guide to designing a restaurant menu for profitability

In a competitive UK restaurant market, every percentage point of profit matters. Rising food costs, labour pressures, and changing customer expectations make it harder to keep margins healthy. That’s where menu engineering comes in, giving you a data-driven approach to designing and pricing your menu so it maximises profitability without sacrificing guest satisfaction.

At Profit First Hospitality, we use menu engineering as one of our core tools to help restaurants increase margins and improve cash flow. Here’s how it works - and why it’s so effective.

Menu engineering is the process of analysing the performance of each dish based on two factors:

• Profitability (how much money you make per item)

• Popularity (how often customers order it)

By categorising menu items into four groups - Stars, Plowhorses, Puzzles, and Dogs -  you can make informed decisions about pricing, placement, and promotion.

So - how does it work?

1.       Identify Your “Stars”

Stars are high-profit, high-popularity items - the dishes that keep customers coming back and your margins healthy. These should be featured prominently on your menu and, where possible, protected from cost increases through smart procurement.

Top Tip: Use design elements like boxes, icons, or chef’s recommendations to draw the eye to these items.

2.        Fix Your “Workhorses”

Workhorses sell well but don’t deliver high profits. Often, these are menu staples that customers love, but rising ingredient costs may be eating into margins.

Strategies to improve your Workhorses:

• Adjust portion sizes

• Negotiate better supplier terms

• Upsell add-ons or premium sides

3.       Turn “Puzzles” into Profits

Puzzles are high-margin items that, for some reason, aren’t ordered often. This is usually a marketing or positioning problem, not a product problem.

Ways to boost sales by updating your menu puzzles:

• Rename or re-describe the dish to make it more appealing

• Move it to a more prominent menu location

• Feature it in specials or tasting menus

4.       Deal with the “Dogs”

Dogs are low-profit, low-popularity items, and they’re costing you money in wasted stock and kitchen time. In most cases, these should be removed from the menu to reduce complexity.

When done well, menu engineering can not only increase average profit per cover, it will also reduce waste by focusing on high-performing items, improve service speed through a more efficient kitchen line, and strengthen your brand by focusing on signature dishes

Many restaurants see a 3–5% profit margin increase within months of implementing menu engineering without increasing prices across the board. But menu engineering isn’t just about making your menu look pretty. It’s a strategic financial tool. By analysing performance, optimising design, and focusing on profitable items, you can increase restaurant profits without alienating your customers.

At Profit First Hospitality, we integrate menu engineering into our wider Profit First system for hospitality. By aligning your menu with your financial goals, we help you create a menu that not only delights customers but also supports healthy, predictable profits.

Want to take control of your restaurant’s profit? Sign up today and let us help you implement the Profit First system in your restaurant.