Restaurant Start Up Tips

On a hungry day in August of 2005, Mr. Otto Perry opened a hot dog stand in Columbus, Georgia. From these humble beginnings, in the midst of a recession when many businesses withered, Otto’s hot dog stand blossomed into a deli and bakery.

Otto’s deli and bakery exemplifies the importance of focusing on one’s core products when starting a restaurant and designing its menu. Otto owed his success to the sale of the great American hot dog. And yet, he had no tribute to this food item anywhere on the menu! Otto offered only one way to order a hot dog, but customers were still buying them at a rate three times higher than any other menu item.

One single mistake many of those starting a restaurant make: killing a business by neglecting their original mission. To prevent this, my advice is always: Focus on your core menu items or you won’t have a core to build around.

Building Your Core Menu Items

When starting a restaurant, the core of your business should revolve around the menu items that your customers are willing buy from you most often, and those that can also bring a higher plate contribution. In a restaurant start-up, you have to decide what you want to be famous for. If you’ve been around for a month or more, you can do a little research to help find your core menu items.

To find your core after starting a restaurant, get a listing of the total volume of sales of each item on the menu. If you are counting tickets, just use a list of the total volume of sales for a week. Divide these sales into categories: Sandwiches, Entrees, Pizza, etc. Write these restaurant menu items in order of popularity showing the top ten items in a list. You may want to use our Menu Matrix software. The report, when completed, will look like the sample provided here:

Circle the top couple of menu items in each list and imagine they were categories instead of single items. The top menu item in Otto’s list was the hot dog, and because of its history, we decided the hot dog was the product core to build. We could have just as easily chosen the Italian Job or the City Club and expanded them into categories by adding a melt or Panini to the menu. Once you’ve decided on a good candidate, write down a list of restaurant menu items that might fit into that category. Do some research to find items that already have some market acceptance elsewhere. You’re looking for about three or so items to round out your new category. No need to be too adventurous, the purpose of these menu items is to draw attention to your top seller as a category. Once you have your list, narrow it down by trying them on your customers with free samples or feature items and pick the top performers.

In the example of Otto’s City Market, we had a list of about 20 different styles of hot dog recipes that might work and quickly narrowed that list down to the following items: Cheddar Dog, S.W. Chile Dog, Chicago Style Dog, Turkey Dog, etc. After a discussion with Otto, we narrowed them down to only a few more upscale items. Now, Otto is seeing a significant increase in check totals as his customers exchange their standard hot dog for the gourmet one.

Shortly after starting a new restaurant menu, which focused on his core menu items in addition to HotOperator's menu engineering services, Otto’s competition called him and asked if his restaurant business was as bad off as hers. He tried not to gloat, but while her restaurant business was withering, he was having another record-breaking sales week. After this experience, Otto said, “I will never look at a menu the same way again.”