Finance for a Business Project Assignment

Menu Engineering Assignment


Menu Engineering AssignmentThis report focuses on the Menu Engineering in Food and Beverage operations in the hospitality industry. The several advantages and as well as the disadvantages of using the Menu Engineering in the food and beverage operations are introduced in this research report. In addition, the analysis of menu engineering using the Kasavana and also Smiths method and as well as the offer solutions are briefly introduced in this complete study report. Thus, as a hospitality organization, the Aberdeen Marriott Hotel is chosen where the menu engineering is applied by its manager for the owners of this hotel. Every hospitality industry focuses on its services. The word service refers as a complete experience which all guests get from people’s performance who serves the requirements (Nabavi, Fox, Proulx, Lin, Tsien, & Malinow, 2014). The Service from any hotels effectively touch several sense of all its guests include sight sense, smell sense, hearing sense, taste sense, touch sense and so on.

Overview of the hotel

Aberdeen Marriott Hotel  is a five-star luxurious hotel based in Scotland (Marriott, 2017). The hotel is located at United Kingdom, as it is a part of Marriott group of hotels. The exact location of the hotel is Aberdeen, Scotland AB21 7AZ United Kingdom. It is one of the best hotels among all the hotels of Marriott hotel groups. Aberdeen Marriott Hotel is called Overton Circle-Dyce. This hotel has a feature called smoke free policy. As the Marriott group of hotels are going as smoke free in all over the world in 2006. This hotel gives the complementary parking services for the guests (Marriott, 2017).

Description of menu engineering

Menu Engineering refers as both the popularity and profitability study of the menu items. Menu engineering describes the way of influencing the effective placement of several menu related items by these two factors (Cong, et al., 2013). The main goal of the menu engineering is to increase the profitability per guest. Menu engineering is generally introduced in the year 1970 by the group named Boston Consulting Group for helping the businesses segment and the products in the effective way which facilitates both the analysis and the decision making. Generally, very often, menu engineering is mentioned in the traditional paper of the restaurant menus, as the concepts are completely applicable to the menus which is posted online, specials written on the table tent, drinks menu and as well as several items which are written on the menu boards (Duffie & Beckman, 2013). Menu engineering can be easily applied in any industry which displays the product list or the service list that offers the choice of all customers. In a typical way, the main objective of menu engineering is to increase the profitability of the organization, via encountering the customer for buying according to the choice of the produces, in a subconscious way (Bird, 2013). There are several study fields that helps for contributing to the menu engineering the most, include

  • Psychology includes perception, emotion and attention.
  • Managerial Accounting includes analysis of unit cost and contribution.
  • Strategy and marketing include promotion and pricing.
  • Graphic Design includes layout and typography.

In addition, menu engineering is the step-by-step process by which the management can able for evaluating the present and as well as future design, menu pricing and the content decisions. The approach of the menu engineering needs the attention which can be completely focused on the critical elements include

  • Demand of the customer– It describes the complete number of the served customers.
  • Menu Mix (MM) – It refers as the customer preferences analysis in the selection of the menu item that is related to the elasticity of demand.
  • Contribution Margin (CM) – It refers as the contribution margin or the gross profit analysis for the menu item that is completely related to the price elasticity(Feinstein & Parks, 2014).

Analysis of menu engineering using Kasavana and Smiths method and offer solutions

Menu engineering needs that the management focuses upon the elements which are the most critical in nature in a direct way, as it is completely affected by the pricing decisions that include (Reynolds, et al., 2013)

  • Customer demand – It refers as the overall number of the customers who are served.
  • Menu item which purchase patterns – It refers as the menu or the sales mix.
  • Average contribution of the margin – It refers as the amount of the gross profit which is contributing to other profit and direct costs.

In the year of 1980 and 1987, Miller developed the matrix model which focused on cost of the food and the product mix at first for analyzing the profitability of the menu items. In 1982, Kasavana and Smith applied the analysis called Boston Consulting Group Portfolio Analysis, as the main base for the matrix approach of the menu engineering for the analysis of the menu. Experts stated that it refers as the analysis tool which helps for labeling the menu items within the group of competing menu via the use of its respective popularity and as well as the margin of the contribution for placing them in a basis category. The matrix of Kasavana and Smith is also referred as “menu engineering” (Kimes & Beard, 2013). This matrix helps for incorporating both the volume and the margin of contribution, that this helps for defining as the basis differences between the price of sales of the item and the food product’s cost that consumed for producing that item, more commonly it is referred to the present as the ‘gross profit. In addition, Kasavana and Smith considered both low cost of the food and the high gross profit as mutually exclusive. These two experts developed the matrix and the menu items which are divided in total four categories include Star, Puzzler, Plowhorses and Dogs. This attributes helps for taking the contribution margin on horizontal axis and as well as the volume on vertical axis. The matrix has four sections as it is shown below.

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