What Every Chef Should Know - Charging The Right Price

Show Notes

1. Closing restaurants sucks
2. Running a cash cow restaurant rocks.
   1. Volume hides a multitude of sins and fool you into thinking you're a genius.
   2. If you know how, you can milk it.
      1. Creativity isn't just about flavors and piling the food into a little towers.
      2. Creativity is about creating and maximizing value.
      3. Don't run a special or put something on the menu to only figure out three weeks later it is at 40%
   3. Common mistake for young chefs
      1. Too many ingredients
      2. Weird ingredients
      3. Weird cooking methods
   4. Focus on tasty
      1. Classics are classics for a reason - learn to execute them well.
      2. Make people go yum.
      3. Make people forget to take a picture.
      4. Seasoning and basic cooking techniques
   5. Micro vs Macro - plate cost vs case cost
      1. Micro - plate cost
         1. Chicken at $3.00 per pound with 90% yield
         2. 3.00/.9 = 3.33 per pound
         3. 5 oz  = $1.25 + $1.50 for rice veggies and sauce
         4. $2.75/.25 = $11.00
      2. Macro - case cost
         1. $120 for a 40# case of chicken with 90% yield
         2. 40*.9 = 36
         3. 36*16/6 = 96
         4. 120/96 = 1.25 per portion
         5. Can you move 96 portions?
         6. Can you do something really cool to max the value of 1.25?
         7. Can you move five cases?
      3. Financial Model
         1. COG 25%
         2. Labor 35%
         3. Operating Expense 10%
         4. Occupancy 15%
         5. EBITDA 15%
            1. Find out what your is.
            2. In theory, pricing food to hit your target food cost will cover labor and your other expenses.
            3. Leave some wiggle room
               1. 30% target = 28% pricing
      4. Cheat Sheet download
         1. Portion cost on top
         2. Plate cost on the bottom
            1. $5.00 per pound at 80% yield and a 6 oz portion = 2.34 per portion
            2. Add an estimated amount for accompaniments ($2.00)
            3. $2.34 + $2.00 = $4.34 plate cost (round up to 4.50)
            4. Target 25% and you need to charge at least $18.00
   6. It is all philosophy
      1. Success equals attitude and competency
      2. How are you looking at the opportunities and challenges?
      3. Are you asking smart questions?
      4. If you sold nothing but this one new item all day would it help or hurt?
      5. If it would hurt you change it or drop it?
         1. Don't get romantic about the food get creative with it and give the customer what they want
         2. When people see the plate go by, do they ask what is that?
         3. Is the trash can in the dish pit full of food?
         4. Talk to the customer and find out.
            1. Too many chefs afraid of negative feedback.
            2. Grow a pair and listen.
            3. Hear a problem, solve it, they will be blown away
               1. Nobody does this!!!
            4. Talk to everyone
            5. Get the manager to teach you.
   7. Look for vendor specials and clearance items

 

 

Bonus content: Menu Pricing Grid PDF