The baseline; Kothrud casual dining, month 14
| Metric | Before redesign |
|---|---|
| Menu length | 87 items |
| Monthly revenue | ₹19.2 lakhs |
| Food cost % | 34.2% |
| Average ticket (dine in) | ₹620 |
| Average ticket (aggregator) | ₹540 |
| Aggregator share | 44% |
| Contribution margin | 44.8% |
| Days above break even | 48% of operating days |
Profitable on paper but barely. Food cost trending up over the prior 6 months. Customers cited ‘too many options’ in feedback. Kitchen ticket times averaged 24 minutes; well above the 16 minute casual dining target.
Step 1; Run the menu engineering matrix
Plot every dish on a 2×2 grid: popularity (units sold ÷ category average) vs margin (revenue minus food cost). Four quadrants:
- Stars; high popularity, high margin. Protect.
- Plow Horses; high popularity, low margin. Re engineer.
- Puzzles; low popularity, high margin. Reposition or remove.
- Dogs; low popularity, low margin. Cut.
The 87 item menu had 11 Stars, 14 Plow Horses, 19 Puzzles, and 43 Dogs. Almost half the menu was carrying its weight neither in popularity nor in margin. The full menu engineering matrix guide covers the methodology.
Step 2; Cut all 43 Dogs
Counterintuitive but data supported. Dogs sell <1% each but their inventory presence increases waste, spoilage, and customer decision time. Cutting them dropped menu length to 44 items immediately. Kitchen reported a 3 day adjustment window, then ticket times dropped from 24 → 17 minutes.
Step 3; Add 8 new items to refill the Puzzles + Star ratio
Menu went from 44 back to 52. The 8 new additions were designed to be Stars (recipe costed at 28% food cost, positioned at premium price points, garnished and named for menu appeal). Three converted to Stars within 30 days; three became Plow Horses; two were dropped at 60 day audit.
Step 4; Reposition 7 Puzzles
Puzzles are high margin items customers ignore. Two reasons usually: poor menu position or poor naming. Re named ‘Hyderabadi Mutton Dum’ from ‘Mutton Biryani’ (already on menu, now more distinct), moved to a boxed ‘Chef's signature’ section. Sales of that item alone went from 8/month to 47/month within 60 days; single biggest contributor to margin lift.
Step 5; Apply bundle architecture
Three new combo bundles: thali + drink (₹360 vs à-la carte ₹390), biryani + raita + drink (₹520 vs à-la carte ₹565), dosa + filter coffee (₹180 vs à-la carte ₹195). Bundle attach rate hit 32% of orders within 45 days. Average ticket lifted 8% on dine in.
Step 6; Differentiate aggregator pricing
Created aggregator only menu with 11% markup on all items. Customers don't price compare; the markup was unnoticed. Recovered most of the aggregator commission delta.
Step 7; Tighten portion SOPs
Standardised ladle sizes for gravies, weighed proteins on a digital scale during plating, posted visual portion guides above the pass. Reduced ‘chef portion creep’; the gradual over portioning that drifts in over months. Saved 0.7 points of food cost alone.
Step 8; Supplier rationalisation on top 5 commodities
Audited rates for paneer, ghee, oil, chicken, mutton across 4 suppliers. Switched primary supplier on two (paneer, ghee) with the secondary kept active as a fallback. Saved 0.9 points of food cost.
The result; 90 days later
| Metric | Before | After | Δ |
|---|---|---|---|
| Menu length | 87 | 52 | -35 |
| Monthly revenue | ₹19.2L | ₹21.4L | +11.5% |
| Food cost % | 34.2% | 30.1% | -4.1 pts |
| Average ticket (dine in) | ₹620 | ₹670 | +8% |
| Average ticket (aggregator) | ₹540 | ₹598 | +10.7% |
| Aggregator share | 44% | 42% | -2 pts |
| Contribution margin | 44.8% | 60.2% | +15.4 pts |
| Days above break even | 48% | 76% | +28 pts |
| Kitchen ticket time avg | 24 min | 17 min | -29% |
What didn't work
- Pushing Stars harder; ‘Chef's recommended’ tags on Stars lifted them <3%. They were already selling.
- Discounts on Plow Horses; the 5% off promo lifted volume but the contribution margin actually dropped. Stopped at week 3.
- Raising bestseller prices; even ₹20 on the biryani lost orders. Reverted in 2 weeks.