Restaurant Pricing Strategy
Restaurant Pricing Strategy
Grow Guest Count & Average Ticket Size
At Pricing Solutions we believe that setting and managing prices is an ongoing process that your business should continually re-evaluate and improve.
Restaurant and QSR businesses can improve their revenue and margin through understanding what drives customer-purchasing decisions. Pricing Solutions combines Pricing Research and Restaurant Pricing Strategy to drive store profitability and help your business set fair prices.
Building Advanced Restaurant Pricing Capabilities
- Applying store tiering to drive store profitability
- Menu optimization to drive revenue & margin
- New product pricing research to quantify and understand
customer behavior - Customized dashboards and tools for strategic decision making
and performance measurement - Benchmarking against World Class competitors
Our clients achieve a typical payback of 10:1 on their project investment through our customized approach.
Expert
Benjamin Garden
Vice President, Analytics
Developing a High Impact Pricing Strategy for Restaurants & QSR
Proven four-step approach to design and implement a superior restaurant pricing structure to be completed over approximately 12 weeks.
Success Story: Restaurant Pricing Case Study
The Challenge
- The business had been successful with their traditional pricing strategy, managing menu prices through cost control measures.
- However, as the business continued to grow the client wanted a more precise and sophisticated pricing strategy that leveraged the rich customer data they had collected.
- The client was also concerned because they had attempted store tiering and other advanced analytics techniques before with little success.
- They needed a solution that was data-driven and supported by strong pricing methodology and research.
The Solution
- Data Analysis
- Segmentation was key in this pricing strategy. To facilitate this, we conducted a thorough analysis of the client’s transactional data from the past year, trends in customer demographics and buying behavior. These trends created core customer segments.
- Defining Optimal Price Points
- When combined with further Breakeven and Price Dispersion Analyses, Pricing Solutions defined optimal price points per segment and country. Similarly, price floors were established for any given customer groups.
- Building Tools and New Pricing Structure
- Using this information we custom built a ‘Target Price Framework’ – a systematic price negotiation tool. It was a scalable solution; versions could be built for each country/region the client operated in. It could be used in the annual price-setting process as well as day-to-day negotiations of local Sales teams
- The Target Price Template was the first piece in the division’s pricing transformation; a new governance structure was the next. By embedding new pricing skills and knowledge in the corporate culture, the governance process would support long-term success and global consistency.
The Result?
By the end of the project Pricing Solutions had identified several opportunities to improve the chains’ pricing and grow guest count including implementing value meals, managing price points & ticket size, store tiering and new deal thresholds. Pricing Solutions also developed an analytics tool that identified over $10MM in pricing opportunities. Finally, the team delivered a price simulator which allowed the client to set future prices with confidence through the ability to see how price changes affected other categories and the overall profitability of the organization.
What’s the Pricing Solutions Difference?
Without the right tools and experience setting the right price can be difficult. To develop meaningful insights organizations need strong analytics capabilities supported by proven strategic methodologies. Pricing Solutions combines deep restaurant & QSR industry knowledge and experience with pricing expertise to deliver solutions that address the specific needs of the client and provide impactful results.
Contact Us for a Restaurant Pricing Consultation
Pricing Solutions is one of the worlds’ leading pricing consultancy firms. We are dedicated to helping clients tackle their specific pricing challenges and dramatially grow profitability. Our consultants have extensive experience in B2B and B2C markets within a wide range of industries.
For more information about our services or to get in touch with one of our consultants directly please contact our global headquarters.