I’m often asked by restaurateurs how to price a menu and keep prices palatable despite the rising food and running costs. The trick is to offer better value, provide something extra, and be distinctive.
Price vs. value
Price is what you pay. Value is what you get. – Warren Buffet
Let’s look at this successful businessman’s surname and play a little… a buffet is all about vast options and self-service. Fine dining is all about premium ingredients, superior service, and sitting in a super-comfortable chair in a glorious setting. You’re paying for an experience in either restaurant, not just food.
Every restaurant pays the same price for an onion, but what they do with it and how they present it, creates the distinction between run-of-the-mill and world-class, destination dining.
Where brand value comes in
Value is the sum of real and perceived value. If you then try to add further value, that’s an admirable brand. Some brands demand higher prices because they’ve been positioned as aspirational and luxurious. But how does this affect menu pricing?
Real Value + Perceived Value = Total Value
If a restaurateur wishes to charge more, they need to offer more – not a wider selection or larger quantities, but better value. Value is a perception that sits in the hearts and minds of people, and it varies greatly. If you make people feel more special, they will want to return. And, don’t forget, it costs less for you to attract your regulars than to attract new clientele.
How to price your menu for peak and off-peak season
The seasons have an impact on the availability of ingredients and the volume of couverts sold.
Restaurants that rely on tourists can offer winter specials to locals at a lower price when they are not as busy. This maintains staff momentum and morale, helps fill the restaurant during quieter times, and encourages locals to support and experience these premium restaurants.
- Peak season: During peak season, you can charge higher prices, but you need to offer something extra in return and focus on providing great service.
- Off-peak season: To attract customers during off-peak season, you may need to lower your prices or offer seasonal specials to encourage the locals to visit more often.
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