IHOP used to have a 12-page menu. Now it’s giving guests a 2-page, disposable menu. The shift “required a lot of reductions,” Brad Haley, IHOP’s chief marketing officer, told CNN Business. IHOP held on to popular items that weren’t too difficult to prepare. It lost complicated items that fewer guests ordered, and that could be replaced with something similar.
One example: a Simple and Fit omelet made with egg whites and spinach. While the specific dish is no longer on the menu, customers can build their own omelet using the same ingredients. “We didn’t lose any big menu categories, we just trimmed across the board,” Haley said. A smaller menu makes it easier for IHOP to train new workers as it reopens. It also means less waste for franchise operators, who may throw out unused ingredients they buy for less popular menu items.
“I don’t see us going back to the full 12-page menu,” Haley said.
Reducing menus could help. And, at least for now, customers don’t seem to mind.
The problem with raising prices
Restaurants already operate with very thin margins, so it’s difficult for them to absorb costs without making any changes.
One obvious way to cope with higher costs is by passing them on to customers via higher prices. But diners won’t stand for it.
“What restaurants really hate is adding fees and doing things that frustrate the customer,” said Sean Kennedy, the National Restaurant Association’s Executive Vice President for Public Affairs.
If customers see prices go up, they may turn to a competitor. Or they might just eat at home.
“There’s a lot of options outside of restaurant meals,” said Tim Powell, a managing principal of Foodservice IP, a foodservice consulting firm. “If you start raising prices it means that there’s a good chance that demand, or the traffic, will go down.”
Less is more
Shrinking the menu is a better option. It allows restaurants to order ingredients in bulk and achieve better economies of scale. And because restaurants remove their least popular or more expensive items, the changes may impact a relatively small number of customers.
At Dave & Buster’s for example, “the 15 items we selected generate a significant portion of our food revenue,” CEO Jenkins explained.
And while some customers may miss seeing their favorite dish on the menu, others may be happy with — or at least tolerant of — the changes.
At McDonald’s, the newly reduced menu has improved customer satisfaction scores “significantly,” said Mark Salebra, chair of the McDonald’s National Franchisee Leadership Alliance in a statement provided by a company spokesperson.
Plus, some diners may not care that much about variety right now.
Denny’s “customers have been extremely understanding of the adjustments we’ve made,” said Dillon, adding “we’ve found our guests are appreciative of the focus we have been putting on safety, cleanliness and sanitation that a slightly smaller menu enables.”
IHOP’s Haley put it this way: “we’re not seeing complaints from guests.”