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Restaurant Pricing Strategies to Save Your 2021

labor cost menu engineering menu pricing
Restaurant Pricing Strategies to Save Your 2021

Things are changing quick, aren't they? It was just two months ago I was in Las Vegas to speak at the Nightclub and Bar Show, and the main concern there was the shortage of employees, the new crisis at the time. (I've talked about becoming an employer of choice to overcome this challenge now and in the future. Check out episode 23 here.) Now there's another thing that is adding to this crisis: the shortage of food and the resulting increase in prices for restaurant owners. It is one of the largest increases in pricing on menu pricing since the ‘80s. Click below to watch the latest episode of my podcast, The Restaurant Prosperity Formula, or get it anywhere you get podcasts. 

Since the Nightclub and Bar Show, I’ve spoken at the Louisiana Restaurant Association show, and I recorded this at Pizza Expo. In all of these shows, operators are worried about finding people and dealing with food costs that going through the roof.

When and at what point in time will this stop? I'm just like you. I'm riding this train. Where is it taking us? But something that I can bring to you is what is happening week to week with the members of my coaching program and the solutions we’re finding to help them deal with both crises.

I've been coaching my members to attack their menus. Your menu is the key to the labor shortage and your prices.

What do I mean by that? In this episode of my podcast, I tell you a couple of stories about the members I work with week to week and the changes they’re making. They're reducing their menu sizes, they're attacking the menu and getting creative, they're figuring out how to reduce prep and simplify their operations. They’re figuring out how they can make changes during a shift to save the kitchen, to do with less employees, to handle rushes and any unhappy customers.

First I’ll tell you about Emmy and how I kept telling her we had to make changes to the menu. But she’s in small town without a lot of restaurant, and she wanted to be all things to all people. She made other changes that were helping her make more money and have time away from the restaurant until everyone came back to dining. She hired as quickly as she could, but like everybody else, she doesn't have all the employees she needs to handle those and all the catering business that's coming in now.

It finally came to a head that we had to attack the menu and it was very difficult. I'm going to tell you right now, when I start talking about working on your menu, it's me kicking your baby. Your menu is your restaurant. Your menu is you. But it’s not personal to me. When you give me the right numbers, when you have accurate up-to-date recipe costing cards, you have your menu mix your product mix from your POS system, I have data we can use to make informed, non-emotional changes. There are things you can do to make a change. With Emmy I can tell you it was quite emotional, but it was spurred because of the kitchen not having enough employees. And the more you have on a menu, the more employees you need, the higher skill they need. It just takes time. I share it all on the podcast and explain how changing your mix, raising some prices, changing some products, reducing the menu size can attack both labor and food cost.

My next story is about Angie and Doug out of Washington, out on the shore. They have a small restaurant attached to a golf course, and they started with a foodie type concept. But they lost their chef, lost managers, and are truly doing everything they can as operators to make change in their business. They know their numbers. They understand what their customers want. They truly have incredible core values and how they want to deliver for their guests. They still have the same challenges – not enough employees and food costs were starting to get out of control. In working on their budget with them, we realized we had to bring that food cost way down.


You attack the menu. It took hours of discussing how the impact of changing the menu made them feel, what they were worried about, their customers, their employees. It's a big deal, and I don't take it lightly. We took a more creative approach with them because they’re short a chef, but again, we reduced prep, reduced all the knowledge people had to have, got rid of things that people were not ordering quite as heavily as something else. We simplified the kitchen and raised prices. Some of the things the prices had to go way up because they are buying products that have jumped up 300 percent or more. The restaurant owner does not have to carry that burden.

In fact, there are concepts that are dropping chicken wings because there's a shortage and they’re so damn expensive. Others are selling them at “market price.” They were already something that was almost too costly to sell, but really popular.

Because they don’t have a chef for the creative angle right now, they called on their food distributor, Sysco. Broadline distributors have chefs that work for them, not just salespeople, but chefs that work for them in their business development department who can help you create new recipes. Doug and Angie have Sysco to get the creative parts done and me work on the recipe costing card so they know how it will affect their mi and reduce their food cost. Step one was reduce labor, step two was to reduce the number of items and step three is to bring the food costs down by bringing in other products that still fit their concept.

These are just two examples of restaurants I talk about during this episode. I also talk about software that’s working for our members and the key system all of them have in place that allows them to make these changes and decisions. (Hint: It’s recipe costing cards.)

If you're concerned about employees, if you're concerned about your food costs, if you're concerned about the direction and future of your business, it's time you visit me at and book a discovery call with me. I'll happily help you shine a light on where your challenges are. No matter what time we spend, I will share with you exactly what you need to do to make the changes you need to make it through this crisis.

Click the podcast player above to listen in, or you can watch the video on YouTubeclick here to download the latest episode

If you're ready right now to make some serious changes in your restaurant, you can also book a 60-minute call with me where we talk about your challenges and figure out exactly what is holding you back from having a restaurant that doesn’t depend on you being in it to be successful. 

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