Lecture Food and beverage cost control (5th Edition): Chapter 6 - Dopson, Hayes, Miller 

Lecture Food and beverage cost control, chapter 6 - Managing food and beverage pricing. This chapter presents the following content: Menu formats, menu specials, factors affecting menu pricing, assigning menu prices, special pricing situations, technology tools.

Managing Food and  Beverage Pricing

Figure 6.1 Sample Cycle Menu Rotation

Figure 6.2 Alternative Results of Price Increases

Old Price New Price Number

Figure 6.3 Unblended Price Structure

Texas Red’s Burgers

Item Item Cost

Desired Food Cost

Proposed Selling Price Hamburger $1.50 40% $3.75

French Fries 0.32 40 0.80

Soft Drinks (12oz.) 0.18 40 0.45

Total 2.00 40 5.00

Figure 6.4 Blended Price Structure

Texas Red’s Burgers

Proposed Food Cost %

Proposed Selling Price

Figure 6.5 Sample Sales Mix Data

Texas Red’s Burgers

Total Sales: $ 449.25 Guests Served: 100

Total Food Cost: $ 180.20 Food Cost %: 40.1%

Item

Number Sold

Item Cost

Total Food Cost

Selling Price

Total Sales

Food Cost %

Hamburger 92 $1.50 $138.00 $2.49 $229.08 60.2% French Fries 79 0.32 25.28 1.49 117.71 21.5

Soft Drink (12 oz.) 94 0.18 16.92 1.09 102.46 16.5

Assigning Menu Prices

Figure 6.6 Pricing-Factor Table

Desired Product Cost % Factor

Costs of a Specific Food Item Sold

(LEED) rating system developed by the U.S. Green Building Council (USGBC), evaluates facilities on a variety of standards. 

efficiency, energy usage, air quality, construction and materials, and innovation

revenue increases.

prices on selected menu items in the belief that total guest counts will increase to the point that total sales revenue also increases

menu items and pricing them as a group in such a 

manner that the single menu price of the group is 

lower than if the items in the group were purchased individually

• The difficulty in establishing a set price for either a 

salad bar or buffet is that total portion cost can vary greatly from one guest to the next

or buffet is to apply the ABC method.  A items 

should comprise no more than 20% of the total 

product available; B items, no more than 30%; and C items, 50%

Figure 6.7 Salad Bar or Buffet Product Usage

Beginning Amount

Additions Ending

Amount

Total Usage

Unit Cost

Total Cost Sweet &

lowest and highest priced menu item.

Beverages at Receptions and Parties

since each customer group can be expected to behave somewhat differently when attending an open bar or hosted bar function

Product Cost + Contribution Margin Desired = Selling Price

Figure 6.8 Beverage Consumption Report

Unit Name: The Carlton Hotel Beverage

B

C

D

E Wine A

B

C

D Other:

Champagne:

A Sparkling

B Sparkling Pink

8 bottles

Total Product Cost

327.00

Total Product Cost: $327.00

the effectiveness of individual menu items and to 

establish their prices can be complex, but there are a wide range of software products available that can help you:

1 Develop menus and cost recipes

2 Design and print menu “specials” for meal 

periods or happy hours

3 Compute and analyze item contribution margin