How To Evaluate Menu Performance With Data Analytics

Key Takeaways

1. Menu engineering compares dish popularity and profitability using food cost percentage (COGS ÷ Sales × 100) and gross profit margin to guide pricing and placement.
2. Manual analysis means pulling POS sales data and supplier invoices, costing each dish (around 28 minutes per item), then plotting them on a Stars, Plowhorses, Puzzles, and Dogs matrix.
3. The ideal menu mix often follows the 30/30/30/10 rule: 30% Stars to promote, 30% Plowhorses to tune, 30% Puzzles to market, and 10% Dogs to remove.
4. Automation tools like Jelly cut dish costing from 28 minutes to about 3 minutes using invoice scanning, POS integration, and real-time alerts, often adding 2-3% to margins.
5. UK restaurants facing 2026 supplier volatility can protect margins quickly, and booking a demo with Jelly helps automate menu profitability.

Why Menu Profitability Analysis Matters in 2026

Menu engineering gives you a structured way to improve revenue by focusing on dish popularity and profitability. It supports clear decisions on pricing, placement, and promotion. The main metrics are food cost percentage, calculated as (Cost of Goods Sold ÷ Total Food Sales) × 100, and gross profit margin, calculated as ((Sales – COGS) ÷ Sales) × 100.

This analysis reduces waste and protects profit by tracking popularity and margins for every item. You need POS systems like Square or ePOSnow for sales data, supplier invoices for ingredient costs, and reliable inventory tracking.

Manual spreadsheet work becomes unmanageable once revenue passes £500k a year and you add more suppliers, delivery channels, and sites. Complexity grows quickly, and real-time decisions become harder.

Manual Menu Review: Step-by-Step Process

Step 1: Gather Your Sales and Cost Data

Connect your POS system to sales reporting and export total food sales by menu item. Collect all supplier invoices and track inventory using the formula: Beginning Inventory + Purchases – Ending Inventory = Cost of Goods Sold. Food cost percentage uses (Beginning Inventory + Purchases – Ending Inventory) / Total Food Sales, with POS providing Total Food Sales and invoices providing Purchases.

Step 2: Calculate Food Cost and Gross Profit

For each dish, calculate food cost percentage as (Total Cost of Ingredients / Selling Price) × 100. Use recipe costs from invoices and selling prices from your POS. Then calculate gross profit margin as ((Selling Price – Ingredient Cost) ÷ Selling Price) × 100.

Step 3: Build a Simple Menu Engineering Matrix

Place each dish on a matrix that compares popularity, based on sales volume, with profitability, based on gross profit margin. Stars are high-profit, high-popularity items you protect and promote. Plowhorses are popular but less profitable dishes that need cost changes or small price increases. The traditional 30/30/30/10 rule suggests a mix of 30% Stars, 30% Plowhorses, 30% Puzzles, and 10% Dogs.

Step 4: Review Sales Mix and Channel Trends

Look at your sales mix across channels, especially delivery versus dine-in. Include delivery platform commissions, often 15-30%, when you calculate true profitability. Use POS reports to spot seasonal trends and peak selling times for each menu group.

Step 5: Apply Changes to Your Menu

Highlight Stars with strong menu placement and staff recommendations. Improve Plowhorses by adjusting recipes or using modest price increases. Support Puzzles with better descriptions, photography, or new positions on the menu. Remove or fully rework Dogs that use labour and stock without delivering profit.

This manual work often takes 10-20 hours each week for growing venues. Book a demo to see how Jelly completes these calculations in minutes instead of hours.

Jelly Overview: Faster Menu Profitability for Busy Teams

Jelly replaces slow spreadsheet analysis with automated invoice scanning and POS integration, cutting dish costing from 28 minutes to about 3 minutes. The platform reads every invoice line through email forwarding or photo upload, then updates ingredient costs and gross profit margins in real time.

Core features include Flash Reports with daily GP margin updates, Price Alerts that flag supplier increases immediately, and Menu Engineering Sales Mix analysis through POS integrations with Square and ePOSnow. Jelly costs £129 per month per location, includes full onboarding within one week, and connects smoothly with Xero accounting.

Customer stories show clear results. Amber restaurant owner Murat Kilic says, “Jelly keeps my business alive,” and reports savings of £3-4k each month through automated price alerts and stronger supplier negotiations. Ruth Seggie of The Howard Arms reached 80% gross profit margins after switching to Jelly’s real-time costing.

Amber’s case study shows the effect in detail. Volatile supplier pricing and manual invoice work were cutting into margins. Jelly’s price change alerts supported faster supplier talks and menu updates, saving £3-4k every month and delivering a 68× return on investment.

Why Jelly Outperforms Spreadsheets and Enterprise Tools

Excel spreadsheets rely on manual data entry, lack real-time updates, and become hard to manage as your operation grows. Enterprise tools such as MarketMan and Nory offer guided onboarding with specialists and custom training, which suits larger groups but can feel heavy for single sites.

Jelly focuses on UK operators, keeps the interface chef friendly, and supports delivery menu planning that includes commission costs. Users often see margin improvements of about 2 percentage points within three months, driven by automated insights that previously needed dedicated office staff.

Advanced Menu Tactics for UK Restaurants in 2026

Track wastage percentages inside your recipe costs using Jelly’s Cookbook feature so you see true margins. Keep more than one supplier option for key ingredients and use that data to support price negotiations. Test the traditional 30/30/30/10 rule against live data from your own guests and sites.

Stronger tactics include inventory planning based on real-time usage, a separate delivery menu that reflects platform commissions, and multi-site rollouts with central cost control. In 2026, menu engineering often focuses on smaller changes such as offering cocktails instead of desserts, trimming tasting menus, and expanding wines by the glass.

Conclusion: Turn Menu Data into Extra Margin

Manual menu analysis still supports profitable decisions, yet a 28-minute costing time per dish blocks real-time action for growing venues. The step-by-step process above gives you a solid base, and automation with Jelly converts slow spreadsheet work into instant, practical insights.

Combining structured menu engineering with live data usually adds 2-3% to gross margins within three months. For UK restaurants, pubs, and hotels facing unstable supplier costs and expansion plans, that extra margin often separates survival from growth.

Start improving your menu profitability now. Schedule a chat to see how Jelly’s automated invoice scanning, live dish costing, and instant price alerts can remove spreadsheet chaos and increase your margins.

FAQ: Menu Engineering and Profitability Basics

What is the 30/30/30/10 rule for restaurants?

The 30/30/30/10 rule describes a target menu mix where 30% of items are Stars with high popularity and high profitability, 30% are Plowhorses with high popularity and lower profitability, 30% are Puzzles with low popularity and high profitability, and 10% are Dogs with low popularity and low profitability. This balance supports both guest satisfaction and profit, although many modern operators adjust the split based on real-time performance data.

How do you calculate food cost percentage per dish?

Calculate food cost percentage per dish with the formula (Total Ingredient Cost ÷ Menu Selling Price) × 100. Pull ingredient costs from supplier invoices and include correct unit conversions and waste. Take selling prices from your POS system. A dish that costs £4.50 in ingredients and sells for £15.00 has a 30% food cost percentage. Many successful restaurants work between 28% and 35% depending on concept and market.

What are Stars, Plowhorses, Puzzles, and Dogs in menu engineering?

Stars are high-popularity, high-profit dishes that deserve strong promotion through menu layout and staff suggestions. Plowhorses are popular but less profitable items that need cost control or modest price rises. Puzzles are profitable but unpopular dishes that need better marketing, descriptions, or placement. Dogs are low-popularity, low-profit items that usually need removing or a complete redesign. Each group needs a different strategy to improve overall menu results.

How can POS systems improve menu planning decisions?

POS systems provide sales mix data that shows which items sell most often, when they sell, and through which channels such as dine-in or delivery. These reports reveal seasonal patterns, peak times, and guest preferences that guide menu engineering. When POS data links with inventory tools, you can track profitability in real time as ingredient prices change. Platforms like Jelly connect POS sales with invoice-based costing to deliver instant menu performance insights.

What metrics indicate successful menu profitability management?

Key metrics include overall food cost percentage, often between 28% and 35%, gross profit margin per dish, sales mix across menu sections, and inventory turnover. Track average transaction value, visit frequency, and seasonal swings in performance. Watch supplier price changes and their effect on dish margins. Strong operators often gain 2-3% in margins by using structured menu engineering, live cost tracking, and data-led pricing instead of relying on instinct alone.