Foodservice operators are managing a lot of uncertainty right now around food costs and how prices for imported menu items may fluctuate in the months ahead. Fortunately, this can be managed from several directions that may help insulate operators from volatility. For starters, have systems in place to monitor pricing frequently, particularly if you’re adapting recipes regularly. Work with vendors who can support that effort with forecasts, recommended ingredient substitutes, reliable traceability, and even revised agreements that provide group discounts or increased certainty around pricing.
Look for opportunities to optimize your menu and recipes. Where can you adjust portion size or ingredient use to make your business less susceptible to market swings? What items in your inventory can help you add heft to dishes if you need to omit others? If you understand what your most profitable menu items are, you can design your menu and promotions to steer guests in their direction, then weed out/modify items that aren’t pulling their weight (or would likely be impacted by anticipated high prices).
Manage your inventory with precision. Where can you bring in more ingredients that are less prone to market volatility? Where are there opportunities for profitable promotions? AI tools can help you forecast demand and plan accordingly. This is also a good time to review food safety, ensuring your staff is dating, storing and using ingredients in ways that promote safety – and that your kitchen is minimizing food waste wherever possible.

It’s a time of high consumer expectations. The consultancy McKinsey found that 71 percent of consumers expect companies to deliver personalized content – and 67 percent of those customers say they are frustrated when they don’t get it. Personalization also drives loyalty: A survey conducted by Bounteous x Accolite found that 70 percent of respondents said menu recommendations based on past purchases make them feel like a restaurant “knows” them. In senior living facilities, where demographics are shifting and demand for the accommodation of personal preferences is increasing, being able to personalize a dish or menu can attract and retain residents, as well as help keep them safe.
Artificial intelligence is giving businesses a boost here – and the costs of implementation are coming down. Savor reports that IHOP’s use of AI-powered personalization technology is driving a 10-15 percent increase in check averages. The technology analyzes historical order data, then suggests complementary menu items – and 73 percent of guests have been adding those items to their orders.
Beyond helping foodservice operators make the most of their current menu, AI can steer future offerings – and identify how to drive guests to them. It uses guest data to predict future preferences and behavior, providing clues as to how to build a profitable future menu. On ordering interfaces like an app or website, AI tools can also recommend how to modify pages – or where to insert offer banners for specific segments of guests to drive the best results.

The average restaurant wastes 4-10 percent of their purchased food, according to a study by the National Restaurant Association. Foodservice operators who conduct weekly inventory turnover calculations tend to uncover sources of waste, save time and boost their bottom line – and automated inventory management is becoming a commonly used tool to help with this process. But before operators can draw reliable information about their inventory, they need to first understand their menu inside and out – what equipment they need for each item, what ingredients are critical and which can serve as substitutes, how to standardize recipes across locations where specialty ingredients may differ, and where there might be opportunities to innovate, for example. Technology is helpful here too. Modern Restaurant Management reported recently that the bakery chain Le Pain Quotidien adopted an AI tool that serves as a clone of its founding chef, Alain Coumont. The tool, which they call Alain.AI, is used by the bakery’s locations around the world to standardize recipes and get help developing the menu. It has compiled the bakery’s 10,000 historic and current recipes into a closed database that the team can use to develop new recipes more efficiently. Going forward, they plan to plug food and beverage trends into the database so they can develop recipes that reflect those trends, as well as create clones of consumers to better understand and support their food and drink preferences. Tech-driven tools that support recipe consistency and menu management are becoming increasingly common – and can help you ensure that your business prepares a dish to the same high standard each time, all while providing the foundation for you to better manage inventory costs from there. Looking at your database of recipes, how consistently do you include elements such as your yield, portion size, ingredients, mise en place, cooking instructions and methods, plating instructions, photos and other information that ensures consistency?

Thinking about how technology can optimize your business can be overwhelming when there are so many options and potential factors to track. But it can also be a huge opportunity – to manage costs and to understand (and serve) your guests so much better than before. Take AI and its applications with menu pricing. At a time when many reports say consumers are reaching their limit when it comes to restaurant prices, it’s critical to know where the line between price and demand exists for your guests. If you have quality data about your business, AI can analyze it and come up with pricing strategies that consider your guests’ preferences, as well as how your traffic shifts based on the weather or time of day. Restaurants are at a point where they can use dynamic pricing like airlines have been using it for years (when a person takes a flight, they don’t assume they have paid the same price as their seatmate, right?). We’re approaching this point for restaurants. You can harness AI to create personalized pricing options for guests, to make pricing adjustments in real time based on the factors that work for your restaurant, and to strike the right balance between your prices and the demand they accommodate. You can also use your pricing to make your regular guests feel special – with offers and special prices that you appear to have dreamed up with only them in mind. New doors are opening that can help you build stronger connections with your guests. Are you gathering quality data and ensuring you’re making the best marketing decisions you can from it?

We eat with our eyes – or at the very least, the images we see of a dish have more power to sway our ordering choices than the text descriptions we read. In fact, Grubhub found that including professional photos in your menu can increase your sales by 30 percent. Even if you don’t want to overload your menu with images, there are many places beyond your menu where images can drive sales – on your website, in app-based communications to guests, in social media posts. And as generative AI continues to improve, it’s becoming easier for restaurants to generate accurate, quality images of menu items – all with just a series of text prompts. Two startups are making it possible for restaurants to do just this. Hackernoon reports that Lunchbox collaborated with OpenAI to launch a food photo generator, and SWIPEBY has a text-to-photo tool that generates food photos based on menu descriptions. It will likely take a few tries, but you may be able to create a close likeness of the profitable dishes you want to promote by simply describing their ingredients and appearance to these tools.

Feeling competitive? A lot of your industry peers are. Recent research from the National Restaurant Association found that nearly half of operators expect competition to be more intense this year than it was last year. Only 7 percent expect it to ease – and that’s in an environment where the majority of operators say there either the same number of restaurants or fewer restaurants than there were in 2019. Your technology stack can help you make sure you’re seizing every opportunity to serve guests well and keep them coming back. You can accomplish this in several ways: Smooth out and speed up your ordering process. Your mobile app can go far in representing the experience of your restaurant. Make it easy for people to view the menu, place orders and make reservations with a minimum of clicks and scrolls. Regular customers should have easy access to previous orders and be prompted with special offers and add-ons that complement their favorite menu items. In-house, consider incorporating tableside ordering and payment to improve order accuracy, expedite service, and ensure your staff can make best use of their time. Depending on your restaurant category, consider using digital menus and signage to update your menu in real time and draw guests to your most profitable items. Finally, your customer data – as well as information you collect about the competitive landscape – can help you better understand how people feel about your menu, keep tabs on your service, and allow you to stay nimble so you’re able to make proactive changes to benefit your business.

​When you’re trying to upsell a guest with an appetizer or a dessert, you have a better chance of transforming their hesitation into agreement if you can show them exactly what they might be missing. Tableside tech can be helpful here. While a tablet can be a time and labor saver in a restaurant, it can also serve as a virtual dessert tray or a sneak peek into your kitchen if you can use it to present quality photos or even video of menu items being prepared. Are there dishes on your menu with a high wow factor – or ones that are especially profitable for you? How can you boost their profile with guests through the tech you currently use?

After a period of two years when technology has demonstrated its worth across a wide range of businesses, restaurants are awash in new data – about their customers, equipment, sales, inventory and more. But any data you collect is only as good as the problems it actively addresses. Make sure the information you collect is working for you by regularly asking some questions of it: What are our most profitable menu items? What menu items need to be adjusted or could benefit from customization? How should I schedule staff during our busiest and quietest shifts? What clues do the data provide about items that could be ideal limited-time offers? Regularly assess the information you’re collecting and identify any loose ends. Any data you generate should help you solve a problem or make an improvement.

The end of the year is a time restaurant operators can count on for strong performance – with December typically the most profitable month of the year. But Black Box data from December points to sales growth of just 4.1 percent, compared to 8.4 percent in November. It marked the weakest month for the industry since the 2.7 percent growth reported in March 2021. In light of those results, a recent Restaurant Business report suggested guests may be questioning restaurants’ value amid steeply climbing costs. It’s no wonder – amid ingredient and labor shortages, along with escalating costs, something has to give. But all the same, operators can only turn those figures around if they can demonstrate the value of choosing a restaurant meal over one prepared at home. Staffing shortages can cause service to take a hit, but you may be able to help compensate for this with improved speed of preparation: Simplify your menu with speed-scratch ingredients or other elements ready to be added to a number of dishes. Remove friction from the process guests must go through when searching for you online and placing an order. That means monitoring your restaurant online to ensure information about your menu, hours and contact information is up to date on review sites, search engines and social media, as well as testing your online ordering functionality to remove glitches and ensure repeat guests are recognized in your system. Speaking of loyal guests, double down on your loyalty program and guest personalization, which will make it feel more worthwhile for guests to support your business (either in your dining room or through order collection), as opposed to having a third-party vendor drop off their delivery order. Finally, aim to appeal to guests’ own values by supporting local suppliers and sharing their business names with guests – an expensive meal feels more worthwhile to a guest when they know it supports their broader community.

Do you use photos of menu items on your website? If so, how well do they represent the dishes you offer? Having clear, accurate photos of your menu items (both in online and in-store menus) saves time for your staff, who don’t have to answer questions about what a dish is like. What’s more, it can also drive other important efficiencies behind the scenes: According to research from Zuppler, compelling photos can elevate your effectiveness online. Having labeled images of menu items can boost your ranking in Google searches and also improve conversion rates, since fewer people abandon online shopping carts when they see a photo of what they are buying.