Shrinking your menu can significantly lower your inventory costs. Fewer dishes means fewer different ingredients, so less money tied up in your cooler and inventory. Here's how to calculate exactly what you'll save.
Why shrinking your menu saves money
Each dish on your menu requires unique ingredients. The more dishes you have, the more different products you need to buy and keep in stock. This not only costs money, but also takes up space in your cooler.
💡 Example:
Restaurant with 40 dishes has on average:
- 120 different ingredients in stock
- Inventory value: €8,500
- Weekly purchases: €3,200
After shrinking to 25 dishes:
- 75 different ingredients
- Inventory value: €5,200
- Weekly purchases: €2,100
Savings: €3,300 less money tied up in inventory
Calculate your current inventory value per dish
For an accurate calculation, you first need to know how much each dish costs you in inventory. You do this by adding up all ingredients per dish and seeing how much you normally keep in stock.
⚠️ Note:
Only count ingredients that are unique to that dish. Basics like oil, salt and pepper you use everywhere, so you don't need to include those.
Which dishes should you remove?
Don't remove dishes randomly. Focus on dishes that:
- Sell poorly (less than 5% of total sales)
- Require expensive, unique ingredients
- Use short shelf-life ingredients
- Take a lot of prep time
💡 Example expensive ingredients:
- Fresh truffles (€80/100g, lasts 1 week)
- Fresh sea crab (€45/kg, lasts 2 days)
- Specialty cheeses (€25/kg, lasts 3 weeks)
- Exotic vegetables (€12/kg, lasts 4 days)
If you only use these ingredients for 1-2 dishes that don't sell well, they're expensive to keep in stock.
Calculate your actual savings
The savings come in three parts:
- Less money tied up: Your inventory value decreases
- Less waste: Fewer products that expire
- Fewer purchasing errors: A clearer inventory means fewer mistakes
💡 Calculation example:
15 dishes removed with each averaging €220 in unique inventory:
- Direct savings: 15 × €220 = €3,300
- Less waste per month: €180
- Better purchasing overview: €120/month savings
Total first month: €3,600 savings
Monthly savings after that: €300
I've seen restaurants make the mistake of not tracking their ingredient overlap properly—a mistake that costs the average restaurant EUR 200-400 per month in unnecessary inventory. They'll remove 15 dishes but still order ingredients for all 40 because they don't realize which items they can actually stop buying.
The impact on your cashflow
Shrinking your menu has an immediate effect on your cashflow. The money that was tied up in inventory becomes available and you can use it for other things. This is especially valuable if you're temporarily experiencing lower sales.
⚠️ Note:
Don't remove your best-selling dishes, even if they have expensive ingredients. The revenue you lose is often worth more than the inventory reduction.
Tracking inventory value digitally
To see the real impact, you need to be able to calculate your inventory value per dish. With an app like KitchenNmbrs you can directly see which dishes require the most inventory capital and make data-driven decisions about your menu.
How do you calculate inventory reduction when shrinking your menu?
Make a list of all ingredients per dish
Go through your current menu and note which ingredients you need for each dish. Focus on ingredients that are unique to that dish or only used in a few dishes.
Calculate the inventory value per ingredient
Add up how much you normally keep in stock of each ingredient and what it costs. Multiply quantity × purchase price for the total value per ingredient.
Determine which dishes you want to remove
Choose dishes that sell poorly and use expensive or unique ingredients. Check your sales data from the last 3 months to see which dishes are below 5% of your total sales.
Add up the inventory value of removed ingredients
Sum all ingredients you no longer need after removing dishes. This is your direct inventory reduction and the amount that becomes available for other purposes.
✨ Pro tip
Calculate your ingredient overlap before making cuts—dishes sharing 3+ core ingredients might not free up as much inventory as you think. Track your actual purchasing reductions over the first 8 weeks to measure real savings.
Calculate this yourself?
In the KitchenNmbrs app you can do this in just a few clicks. 7 days free, no credit card.
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Frequently asked questions
How much can I typically save by shrinking my menu?
On average you can save 15-25% of your inventory value by going from 40 to 25 dishes. For an average restaurant this means €2,000-€4,000 that becomes available from inventory.
Do I need to count all ingredients from removed dishes?
No, only ingredients you don't use anywhere else. Basics like oil, salt, onions and standard spices you use in multiple dishes, so you don't need to count those.
How do I know which dishes sell the least?
Check your POS system or sales figures from the last 3 months. Dishes that make up less than 5% of your total sales are candidates for removal.
Does shrinking the menu also reduce my waste?
Yes, fewer different ingredients means fewer products that can expire. On average waste decreases by 10-20% with a well-thought-out menu reduction.
📚 Sources consulted
- EU Verordening 852/2004 — Levensmiddelenhygiëne (2004) — Official source
- EU Verordening 853/2004 — Hygiënevoorschriften voor levensmiddelen van dierlijke oorsprong (2004) — Official source
- EU Verordening 1169/2011 — Voedselinformatie aan consumenten (2011) — Official source
- NVWA — Hygiënecode voor de horeca (2024) — Official source
- NVWA — Allergenen in voedsel (2024) — Official source
- Codex Alimentarius — International Food Standards (2024) — Official source
- FSA — Safer food, better business (HACCP) (2024) — Official source
- BVL — Lebensmittelhygiene (HACCP) (2024) — Official source
- Warenwetbesluit Bereiding en behandeling van levensmiddelen (2024) — Official source
- WHO — Foodborne diseases estimates (2024) — Official source
Food Standards Agency (FSA) — https://www.food.gov.uk
The HACCP standards shown in this application are for informational purposes only. KitchenNmbrs does not guarantee that displayed values are current or complete. Always consult the FSA or your local authority for the latest regulations.
Written by
Jeffrey Smit
Founder & CEO of KitchenNmbrs
Jeffrey Smit built KitchenNmbrs from 8 years of hands-on experience as kitchen manager at 1NUL8 Group in Rotterdam. His mission: give every restaurant owner control over food cost.
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