Menu Margin Matrix
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What this tool does
Every item on the popularity × margin grid — stars, plowhorses, puzzles and dogs, plus the items losing money on every sale.
Other tools for this stage
- Ops CopilotDescribe what's going wrong in the unit; get causes, this week's actions, and metrics.
- Multi-Unit BenchmarkPut your units side by side — find the drag, and what closing the gap is worth.
- FDD Builder AIFor franchisors: your disclosure outline, the data to gather, and the earnings-claim call.
- Break-Even CalculatorThe revenue — and customer count — a unit needs each month before it makes a cent.
- Working Capital & RunwayModel the ramp-up: the working capital a unit burns before break-even, and whether your reserve survives it.
- Occupancy Cost RatioCheck rent + occupancy as a share of revenue against healthy benchmarks, and your max sustainable rent.
What this calculates
Plots every menu item on two axes — how often it sells and how much margin it contributes — producing the four familiar groups: stars, plowhorses, puzzles and dogs. It also isolates the items that lose money on every single sale, which are the ones worth acting on first.
What you will need
Sales count per item. Over a period long enough to be representative. A single week distorted by weather or a promotion will misclassify items you then act on wrongly.
True cost per item. Including yield loss and waste, not just the purchase price of the ingredients. Costing a plate at supplier prices understates it, often materially — the Recipe Cost tool exists for exactly this.
Menu price. The price actually paid on average, after routine discounts and any bundling.
How to read the result
Act on the quadrants differently, because they need different responses. Popular but low-margin items are usually a costing or portioning problem rather than a pricing one. High-margin items that sell rarely are a visibility problem — placement and staff recommendation move them more than price changes do. Items that lose money on every sale should be repriced, reformulated or removed, but check first whether one of them is the reason customers come at all.
Questions about this tool
Should I just delete the dogs?
Not automatically. Check whether an item anchors a group order or serves a dietary need that would otherwise send the whole table elsewhere. Some low performers earn their place through the orders around them.
Why does true cost matter so much here?
Because misclassification is expensive. An item costed at purchase price rather than usable yield can look like a star and actually be a puzzle, and you will promote the thing losing you money.
How often should I re-run it?
Whenever the menu changes materially, and after any significant input-cost movement. Classifications shift quietly as ingredient prices move.
For reference only; not legal, tax, or investment advice. Results depend entirely on the figures you enter — check them against your own quotes and your franchise agreement before acting on them.