Star-plowhorse-dog-puzzle matrix: the menu before and after you measure it

Step 1: pull ninety days of sales by dish and by family

The first deliverable is a table with four columns per dish: units sold, menu price, raw food cost, and the family it belongs to. Ninety days, not thirty, because a single month captures one promotion or one rainy week and lies to you. At that 140-seat Bogotá steakhouse, the file came back with 3,100 monthly units of tenderloin and 410 of octopus, and that gap alone was enough for the owner to blame the octopus before ever looking at margin. You verify the deliverable by adding up sales across every dish: if the total doesn't match the register report for the same period within 2%, you have dishes off the list or combos your POS refuses to break apart. Fix that before moving on, because the entire matrix rests on that sum.

Step 2: calculate contribution margin in currency, not in percentage

The money axis is margin in CURRENCY, and half the menus I review get lost right here. Menu price minus raw food cost, dish by dish, with no payroll, rent, or utilities loaded onto the plate: those belong to break-even, not to the dish. The tenderloin left 9,800 pesos per unit and the octopus 31,400, meaning the octopus tripled unit contribution while the owner kept calling it the weak one. Now multiply: 3,100 times 9,800 gives 30.4 million a month against 12.9 million from the octopus. Both figures matter and they say different things. A dish carrying 72% margin that sells 40 units puts less cash in the drawer than one at 58% selling 900, and the percentage alone will never tell you that. Done when every dish has unit contribution and total contribution.

Step 3: set the popularity threshold at 70% of the family's average sale

Kasavana and Smith did not use the simple average and neither should you. The rule, published in 1982 out of Michigan State University, reads: one divided by the number of dishes in the family, multiplied by 0.70. If your entrée family holds 12 dishes, expected average sale is 8.3% and the threshold lands at 5.8%. Any dish above 5.8% of that family's units is POPULAR. The simple average over-punishes long menus: with 12 dishes, demanding 8.3% condemns half of them by arithmetic rather than by performance. And the comparison happens WITHIN the family, never against the whole menu, because crossing desserts with entrées produces four beef stars and a list of dogs that are perfectly ordinary desserts selling like desserts. Deliverable: one column with the threshold per family and a yes/no popularity flag per dish.

Step 4: cross the two axes and sort the four quadrants

High margin plus high popularity gives you a STAR: don't touch it, don't discount it, shield it from a supplier change. Low margin with high popularity is a PLOWHORSE, the dish that fills the room and doesn't cover rent. High margin with low popularity is a PUZZLE, and that's where the octopus sat: 31,400 pesos of contribution buried on the second-to-last page, same type size as the sides, no photo, not one line explaining why it cost what it cost. Low margin and low popularity is a DOG. Four boxes, zero poetic interpretation. The matrix earns nothing from the drawing; it earns everything from what it forces you to do the following Monday. Verify that the dish count across the four quadrants equals the full menu and that no family landed entirely in one box, which signals a badly calculated threshold.

Step 5: raise plowhorse prices and push puzzles into the first third

You raise the plowhorse's price, full stop. It's the dish people already order, with proven demand and less price sensitivity than you fear; start at 6% to 8% and measure four weeks of units before moving further. The puzzle gets repositioned instead: first third of the menu, its own type size, a description that justifies the price through origin or technique, and a photo. Cornell measured up to 30% more sales for a dish carrying an image, plus roughly 6.5% per dish when the photography is professional. At that steakhouse, moving the octopus to page one with a photo and dropping the tenderloin one line would have shifted the mix without touching the kitchen. Oracle NetSuite puts sustained profit improvement from well-executed menu engineering at 10% to 15%, and that is precisely the lever. Done when every plowhorse has a new price and every puzzle a new position.

Step 6: adjust for station time, labor, and differential waste

Here's the uncomfortable part classic menu engineering keeps quiet: the matrix ignores station time, labor cost per dish, and differential waste, so a dish can register as a star while sinking your kitchen on Friday at nine. The adjustment is simple and we apply it every time: time the pass on your ten best sellers, calculate cost per minute on your line —with the US restaurant base hourly wage already at 14.20 dollars after climbing 4% in 2024, according to 7shifts, a cook's minute stopped being free— and subtract that cost from margin. Add real waste, not theoretical waste. A dish that occupies the flattop 11 minutes at peak blocks two tickets: its true contribution is its own minus what never left the pass. With that column, two or three stars turn back into plowhorses.

Common mistakes that ruin the matrix before you apply it

Four failures explain almost every useless matrix that reaches my desk. First: using food cost percentage as the money axis, which sorts the menu backwards and rewards dishes that move no cash. Second: mixing families, with the dessert-shaped dogs already described. Third: killing the dog on reflex. The dog doesn't always die; when it carries a brand promise —the only vegan option, grandfather's dish that brings in a table of twelve— it becomes acquisition cost and it stays, though with a cheaper recipe. Fourth, and the most expensive: running the matrix once and filing it. Input prices move; fresh salmon fell 3% and frozen shrimp 6.6% in March 2024 according to SeafoodSource, and a swing like that reorders quadrants on its own. Recalculate quarterly, by calendar, not by mood.

Closing: how to know everything landed right

Check six points and you'll know the work is finished. One: your table's sales total matches the register within 2%. Two: every dish carries unit contribution in currency and total contribution. Three: every family has its own threshold built with the 70% rule, not with the average. Four: every plowhorse has its new price applied and the application date written down. Five: every puzzle changed position, description, or photo, and you can point to which of the three. Six: an adjustment column for pass time and waste exists on at least your ten best sellers. If all six hold, measure total dining-room contribution at sixty days against the baseline; the reasonable range we work with at Masterestaurant, and the one Diego F. Parra defends in every implementation, is that 10% to 15% improvement Oracle NetSuite documents. Put the next recalculation date on the calendar today.

What actually changes once you measure?

The money axis is contribution margin in CURRENCY, never food-cost percentage. A dish at 72% margin selling 40 units banks less cash than one at 58% selling 900, and the percentage alone will never tell you that.

Popularity is measured INSIDE the family, not against the whole menu. Comparing a dessert with a main course manufactures four meat stars and a dog list made of perfectly ordinary desserts. The popularity threshold is not the average: it is 70% of the family's expected mean share (1 divided by the number of dishes, times 0.70).

What actually changes once you measure — in practice?

That is the Kasavana and Smith rule, and the plain average over-punishes long menus. A dog does not always die.

When it carries a brand promise — the only vegan option, grandmother's dish that brings the whole family — it becomes a positioning cost, decided with a cold head rather than with nostalgia. Plowhorse price rises go in steps of 4 to 7%, never in one jump, and you read real elasticity in the POS three weeks later. Physical redesign matters as much as the arithmetic: order and visual weight shift sales mix by 8 to 15% without touching a single price.