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    Module 3 Pricing

    Uploaded by

    Rajesh Gupta

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd

    Module 3 Pricing

    Uploaded by

    Rajesh Gupta
    3 views8 pages

    Copyright

    © © All Rights Reserved

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    PPTX, PDF, TXT or read online from Scribd

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    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    3 views8 pages

    Module 3 Pricing

    Uploaded by

    Rajesh Gupta

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    You are on page 1of 8

    z

    Pricing
    z
    Introduction

     Pricing is the only element of the Marketing Mix that produces


    revenue for the firm, while all the others are related to expenses.

     Price is the most flexible element of Marketing Strategy in the


    pricing decisions that can be implemented proportionately
    quickly in comparison with the other elements of Marketing
    Strategy.
    z
    Importance of Restaurant Menu Pricing

     Engine Behind Company Success

     Sales are the sole source of Company revenue

     Pricing directly impacts funding of:

    1) Equipments

    2) Utilities

    3) Labour

    4) Ingredients
    z
    Effectively Pricing Menu for Maximizing
    Profit

     Calculating menu price with food cost percentage.

     Calculating menu prices with gross profit margin.

     Essential tactics to price menu.

     Menu psychology – selling your high profiteers.


    z
    Calculating menu price with food cost
    percentage
     Choose ideal food cost percentage

     Determine 25%-35% the raw food cost of the menu item.


    Example- Chicken Caesar salad dish = Chicken + dressing +
    lettuce + parmesan cheese + any other ingredients used in the
    dish. Raw food cost = (COGS) cost of goods sold.

     Calculate the price = Say the cost of goods sold or Raw food
    cost adds to Rs 4. Food cost percentage is fixed at 28% then
    S.P of the dish is- FC % = FC/SP * 100

     = SP = FC/FC% *100 = 4/28*100 = 400/28 = Rs 14.29


    z
    Essential Tactics to effectively price
    Restaurant Menu

     Type of restaurant.

     Competitor’s price.

     Demand for the food item


    z
    Demand For Food Items
    Demand driven pricing
    Competition Pricing Method
    method
     Utilizes the prices of local  Demand would be naturally
    competition following are
    higher because the food
    competition – driven
    and atmosphere that is
    methods
    offered cannot be received
     (a)Price as same as your elsewhere
    competitor- Unique  Example- Sports stadium,
     (b) Price lower than your amusement park, zoos
    competitor- cost effective

     (c)Higher than your


    competitor- High
    end/upscale
    z
    Menu psychology- How to sell high
    group profit margin items

     Customers are likely to order one of the first items they


    notice on the menu.

     Guide attention of high profit items with a graphic color or


    shaded box or border

     In each section place the profitable item at the top & bottom
    of the list.

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