UK Restaurant Cost Crisis: Strategies for Survival
TL;DR: Menu mix analysis ranks every dish by how often it sells and how much margin it returns. The Kasavana and Smith framework sorts items into Stars, Ploughhorses, Puzzles, and Dogs. Read it honestly, and it tells you more than any brand strategy will.
Your menu mix analysis is one of the most honest conversations your restaurant will ever have with you. The trouble is, most operators aren’t listening.
I spent years in kitchens where the menu was treated like a manifesto. You designed it with intent, you printed it on heavy card, and you defended it with the kind of territorial energy usually reserved for parking disputes. What you did not do was interrogate it. That felt like admitting something had gone wrong. It hadn’t necessarily. But the data was still talking, whether anyone was paying attention or not.
Menu mix analysis, if you haven’t come across the term in a formal sense, is the process of measuring how often each dish is ordered relative to everything else you sell and then cross-referencing that frequency against its contribution margin. It tells you which dishes are carrying their weight and which ones are quietly costing you. The classic framework, developed by Michael Kasavana and Donald Smith back in 1982, sorts every item into one of four categories: Stars (high popularity, high margin), Ploughhorses (popular but not very profitable), Puzzles (profitable but rarely ordered), and Dogs (neither). The names are blunt, which is appropriate.
Understanding menu performance is not about cutting your favourite dish because it doesn’t shift enough covers. It’s about understanding the gap between what you think you’re offering and what your customers are actually choosing. Those two things are often quite different, and the distance between them is where most restaurants quietly bleed money.
Here’s the thing about brand strategy. It tells you what you’d like customers to think about you. Your menu mix data tells you what they actually do when they sit down and have to make a choice. One is aspiration. The other is evidence.
I once worked with a restaurant that had positioned itself as a serious fish house. The kind of place that sourced whole day-boat fish had a fishmonger’s board on the wall and made a thing of its relationships with harbours in Cornwall. Very respectable. The menu mix, when we finally pulled the numbers properly, showed that their two bestsellers were a ribeye steak and a truffle chips side dish. The fish dishes were puzzles at best, dogs at worst. The brand said one thing. The customers said another one. Nobody had stopped to reconcile the two.
That isn’t a failure of the kitchen. It’s a failure of listening. Restaurant data insights exist precisely so you don’t have to guess at this stuff.
When you run a proper menu engineering strategy review, a few uncomfortable truths tend to surface. The first is that your most popular dishes are rarely your most profitable ones. That’s not a coincidence. Customers are often drawn to dishes that are priced accessibly or that feel familiar. The kitchen, meanwhile, is spending the most time and ingredient cost on exactly those items.
The second thing you’ll notice is that certain dishes sit on the menu for reasons that have nothing to do with performance. They’re there because the chef likes cooking them, or because they’ve always been there, or because someone wrote a nice thing about them in a local paper four years ago. Sentiment is not a business model. (I say that as someone who kept a braised oxtail on a menu for longer than was commercially sensible.) It was magnificent. It sold eight portions a week. We kept it anyway. I have made peace with this.)
The third revelation, and often the most actionable one, is about your puzzles. These are dishes with a healthy margin that simply aren’t getting ordered often enough. The problem there is almost never the dish itself. It’s usually placement on the menu, the way it’s described, or a price point that makes customers nervous without good reason.
Most people approach food and beverage profitability by obsessing over food cost percentage. It matters, obviously. But a dish with a 28% food cost that sells forty covers a night is doing more work than a dish with an 18% food cost that sells six. The mix is what determines the real picture. Chasing food cost percentage in isolation, without understanding what’s actually being ordered and at what volume, is a bit like trying to understand a recipe by only reading the method and ignoring the ingredients list.
Beverages are often where this gets most revealing. Operators frequently underestimate how much of their margin lies in their drinks list. A well-constructed wine list, or a tight selection of cocktails with honest margins, can meaningfully shift overall profitability without touching a single recipe. The mixed data tells you which wines are being ordered with which dishes, where upselling is happening naturally, and where it isn’t happening at all.
If you’ve never done this properly, the process doesn’t need to be complicated. You need four things: a sales report broken down by dish, your food cost for each item, your selling price, and a quiet hour to think about what you’re looking at.
Don’t try to fix everything at once. Choose one section of the menu, run the numbers, make one or two changes, and measure the effect over the following month. Menus are not static documents. They are something closer to living tools, and they respond to attention.
Sometimes the analysis tells you that the restaurant you think you’re running is not the restaurant your customers are coming to. That’s a genuinely difficult thing to sit with. It doesn’t mean the vision was wrong. It might mean the execution hasn’t caught up with the ambition or that the market in your location has a different appetite than you assumed when you opened.
The chefs and operators I’ve seen handle this well are the ones who treat the data as a conversation rather than a verdict. They ask what the numbers are suggesting, not just what they’re confirming. A dish nobody orders isn’t necessarily a bad dish. It might be badly positioned, badly described, or priced in a way that creates doubt rather than excitement. Restaurant menu optimisation isn’t about surrendering to the lowest common denominator. It’s about understanding the gap between your intention and your customer’s experience and doing something useful about it.
Quarterly is a reasonable minimum for most restaurants. If you change your menu seasonally, run the analysis at the end of each season before you write the next one. You want enough data to see patterns, not just anomalies.
Almost certainly not. A workhorse drives volume and keeps seats full. The question is whether you can adjust the recipe, renegotiate ingredient costs, or slightly reposition the price to improve its contribution margin without killing demand. Small adjustments often matter more than dramatic cuts.
No. A spreadsheet and honest sales data will get you most of the way there. Dedicated restaurant analytics tools are useful at scale, but a small independent operation can do meaningful menu engineering strategy work with basic tools if the thinking behind it is sound.
Then you effectively have two different restaurants sharing a kitchen and a menu, which is more common than people admit. Lunch and dinner crowds often behave quite differently. If the data shows that divergence, consider whether your menu is serving both groups well or whether it’s actually a mediocre compromise for each.
The numbers won’t tell you everything. They won’t tell you why a dish is underperforming, or what a table said to each other before they ordered, or whether your server described something beautifully or just pointed at the menu with vague disinterest. But they will tell you what’s actually happening in your dining room, stripped of optimism and bias. That’s a rarer and more useful thing than most operators give it credit for.
Chef Ian McAndrew’s specialist eBooks and guides are available directly on ChefYesChef, including his technical titles and autobiography. If you want more practical, chef-led reading beyond this article, you’ll find the full collection here.
Chef Ian McAndrew works with chefs, businesses, and individuals on a wide range of culinary projects, from concept development to practical problem-solving.
If you’d like to talk through an idea or need informed guidance, you’re welcome to contact him.
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