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Wednesday, May 30, 2007

Safe Portion Control Solutions

I guess everyone is aware of the smaller coffee cans now for sale in the supermarkets. The traditional one pound coffee can has shrunk to as little as 11 ounces for certain brands. Each item sold has a little shelf tag with the cost per pound so savvy shoppers can see the true cost per pound differential. The questions for cutting your portion size involve: when? (if at all); how much?; and, what are the other alternatives?

If you are worried about both a higher food cost percentage and the local restaurant competition, I can recommend a few safe portion control solutions. The magnitude of the portion size reduction is key. Not too many people noticed when the cans of coffee stayed in the 15 to 16 ounce zone. When the coffee cans went to 14 ounces, the media picked up on the change.

Today, there is some concern in the marketplace about portion size. The recent press regarding super burger sizes at some of the top QSR groups is negative. Trans fats are out. So is this a good time to reduce the portion size of your top selling item by one sixteenth? That's 6.25% less cost for the same sales price. If your food cost was 35% before hand, you'd have a new 32.8% projected figure. Maybe it is a good time but you may want to take a few extra steps to insure success.

If many of your patrons are currently leaving food on their plate when the busboy comes around, they will most likely ignore this incremental move. An important point here involves frequency. These moves should be made rarely and never twice in a two year period.

It is always possible to offer more than one size or cut for a center of the plate item. Restaurants have traditionally offered King and Queen sized steaks and have offered early bird specials with smaller portions. Terms like petite and super-size are now part of the restaurant customer's jargon. If you are creative with your selling prices for these alternative portion sizes, it is possible to modify customer behavior and point them to higher margin selections.

A price increase for a popular menu item is a decision which many fear. Often, the popular items are the reason customers come to your place of business. These items tend to be less price sensitive than unpopular options. Extreme care should be taken in a highly competitive market with price the number one customer decision variable. Price increases should be done annually or semi-annually on a scheduled basis just before a busy period if possible. Generally, the marketplace tends to expect price increases when the press reports significant inflation. The surging prices for corn and gasoline provide cover this year.

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