Most caterers believe menu engineering only works for restaurants – but that's completely wrong. You actually have more control over guest choices in catering through fixed menus and buffet layouts. The margin improvements can be substantial once you understand the calculation method.
What is menu engineering in catering?
Menu engineering analyzes your dishes on two factors: popularity and profitability. In catering you typically work with fixed menus or buffets, which gives you more control over what guests choose than in a restaurant.
💡 Example catering menu analysis:
Corporate lunch for 50 people, choice of 4 main courses:
- Salmon: 60% choose this, food cost 28%
- Chicken: 25% choose this, food cost 22%
- Vegetarian: 10% choose this, food cost 18%
- Beef: 5% choose this, food cost 35%
Salmon is popular but expensive. Beef is expensive and unpopular.
The four categories of menu engineering
Each dish falls into one of four quadrants:
- Stars: Popular + profitable → Promote
- Plowhorses: Popular + not profitable → Lower cost or raise price
- Puzzles: Not popular + profitable → Promote more
- Dogs: Not popular + not profitable → Replace
Calculating the current situation
For the margin impact calculation you need three figures per dish:
- Current guest selection percentage
- Cost per portion (including all ingredients)
- Selling price per portion (excl. 9% VAT)
💡 Example current margin calculation:
Event: 100 people, menu price €35 excl. VAT per person
- Salmon: 60 people × (€35 - €9.80) = €1,512 margin
- Chicken: 25 people × (€35 - €7.70) = €682.50 margin
- Vegetarian: 10 people × (€35 - €6.30) = €287 margin
- Beef: 5 people × (€35 - €12.25) = €113.75 margin
Total margin: €2,595.25
Improvement scenarios
Now you calculate different scenarios to see the margin impact:
Scenario 1: Replace beef with extra vegetarian
If you remove beef and shift that 5% to vegetarian:
- Salmon: 60 people × €25.20 = €1,512
- Chicken: 25 people × €27.30 = €682.50
- Vegetarian: 15 people × €28.70 = €430.50
New total margin: €2,625 (+€29.75 per event)
⚠️ Note:
In catering you can't force guests to make different choices. Therefore calculate with realistic shifts of maximum 10-15% between dishes.
Calculating cost optimization
Another approach is lowering the cost of popular dishes. I've seen caterers make a mistake that costs them EUR 200-400 per month by not optimizing their most popular items first:
💡 Example cost reduction:
Salmon (60% of guests) lower cost from €9.80 to €8.50:
- Savings per portion: €1.30
- At 60 portions per event: €78 extra margin
- At 20 events per year: €1,560 extra profit
Calculating annual impact
To calculate total impact, multiply the margin improvement per event by your number of events per year:
Formula: (New margin - Old margin) × Number of events × 12 months
- Small wins of €20-50 per event can generate €5,000-15,000 per year
- Major optimizations can generate €20,000+ extra margin
- Focus first on your most popular dishes for maximum impact
Tools for menu engineering
For effective menu engineering you need data on selection patterns and exact costs. Many caterers still work with Excel, but that quickly becomes unwieldy with multiple menus and changing ingredient prices.
A system like KitchenNmbrs helps by automatically calculating costs and running different scenarios, so you quickly see which adjustments deliver the most margin.
How do you calculate margin impact of menu engineering? (step by step)
Gather data from current situation
Note per dish: guest selection percentage, cost per portion and selling price excl. VAT. Use data from at least 5-10 recent events for reliable percentages.
Calculate current margin per dish
Multiply per dish: (selling price - cost) × number of guests choosing this. Add up all margins for the total event margin.
Create improvement scenarios
Test different adjustments: replace dishes, lower costs, or influence selection percentages. Calculate the new total margin per scenario.
Calculate annual impact
Multiply the margin improvement per event by your average number of events per year. This gives the total financial impact of your menu engineering.
✨ Pro tip
Track your top 3 catered dishes for exactly 30 days to establish baseline selection percentages. Focus optimization efforts on these dishes first – they'll deliver 75% of your total margin improvement potential.
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
What food cost percentage is normal for catering?
For catering, food cost typically ranges between 20-30% of the selling price. This is lower than restaurants because you don't need to calculate service, but you do need to account for transport and setup.
How do I influence guest choices at buffets?
Place profitable dishes at the front of the line, use larger serving spoons for cheap items, and put expensive items at the back or in smaller containers.
Should I include VAT in margin calculations?
No, always calculate with prices excl. VAT. The 9% VAT on catering must be passed on to the customer, but doesn't affect your margin.
How often should I apply menu engineering?
Review your menu engineering every 3-6 months, or after major changes in ingredient prices. Seasonal caterers can do this per season.
📚 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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