How to price a dish: menu engineering without the jargon

Most menus are priced by looking at what the pub down the road charges and shading it by fifty pence. That is not pricing, it is copying — and it inherits their cost base, their supplier deals and their rent, none of which are yours.

Start from cost, sense-check against the market

1. Cost the dish properly, at yielded weights and this week's prices.
2. Divide by your target food cost to get a starting net price. A dish costing £3.60 at a 30% target gives £12.00 net.
3. Add VAT for the menu price: £12.00 × 1.2 = £14.40, which you round to £14.50.
4. Now sense-check. If £14.50 is wildly out of step with what your guests will pay, the answer is to change the dish, not to quietly accept a 45% food cost.

Why cash margin beats percentage

A 25% food cost sounds better than 35%. But a soup at 25% returning £4.20 of gross profit and a steak at 35% returning £13.10 are not comparable — you can pay a chef with the steak. Rank dishes by cash gross profit per plate, then look at percentages second.

The kitchen banks pounds, not percentages. Track both, but make decisions on the cash.

The four boxes

Plot every dish on two axes — how often it sells, and how much cash gross profit it makes. That gives you four groups, and each has an obvious action.

• Sells a lot, makes good money — your stars. Protect them. Do not touch the spec, do not let the portion drift, and put them where the eye lands first.
• Sells a lot, makes little money — the traffic drivers. Attack the cost: renegotiate the key ingredient, adjust the garnish, or nudge the price by a small amount. High volume means small changes compound fast.
• Sells rarely, makes good money — under-sold. This is a description and placement problem, or a service problem. Brief the floor to recommend it before you consider dropping it.
• Sells rarely, makes little money — cut it. It occupies prep time, fridge space and a stock line, and it earns none of them.

Re-run it when costs move

A dish priced correctly in January can be underwater by June without anything visible changing on the plate. Suppliers move prices quietly and constantly. The only defence is re-costing when the invoice lands, rather than once a year when you reprint the menu.

FoxEra re-costs every recipe automatically when a supplier price changes, so the dish that slipped below target tells you itself.