Measuring the profit contribution of each menu item by comparing sales revenue against ingredient costs and required preparation labor.
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Menu Profitability
Measuring the profit contribution of each menu item by comparing sales revenue against ingredient costs and required preparation labor.
Related terms
- Contribution Margin — Revenue minus variable costs for a specific item, showing actual profit per sale. This is the key metric for menu engineering decisions.
- Plate Cost — The total ingredient cost for preparing one serving of a menu item, including every component from proteins to garnishes.
- Menu Engineering — A systematic method for analyzing menu items by profitability and sales volume to maximize restaurant revenue and reduce waste.