What menu item is recommended for discontinuation or a price reduction?

What menu item is recommended for discontinuation or a price reduction?

• A. Star
• B. Puzzle
• C. Dog
• D. Plowhorse

Answer: (B)

The most suitable choice for discontinuation or a price reduction is identified as "Puzzle." This term refers to menu items that have a low popularity yet a high contribution margin. Essentially, these items do not sell well compared to others, which indicates that they may not be appealing to customers despite having a higher profit potential if sold. By considering discontinuation or reducing the price of a "Puzzle" item, management can encourage sales, optimize the menu, and potentially redirect resources to more popular or profitable items. Continuing to offer such low-demand items can lead to wasted inventory and operational inefficiencies. In contrast, items like "Star" are popular and profitable, while "Dog" refers to low profitability and low popularity, suggesting that they should potentially be considered for elimination as well. "Plowhorse" items are those that are popular but have a lower contribution margin; while they are frequently ordered, they bring in less profit than ideal. Thus, the focus should indeed be on adjusting the puzzle items to improve overall menu performance.

The most suitable choice for discontinuation or a price reduction is identified as "Puzzle." This term refers to menu items that have a low popularity yet a high contribution margin. Essentially, these items do not sell well compared to others, which indicates that they may not be appealing to customers despite having a higher profit potential if sold.

By considering discontinuation or reducing the price of a "Puzzle" item, management can encourage sales, optimize the menu, and potentially redirect resources to more popular or profitable items. Continuing to offer such low-demand items can lead to wasted inventory and operational inefficiencies.

In contrast, items like "Star" are popular and profitable, while "Dog" refers to low profitability and low popularity, suggesting that they should potentially be considered for elimination as well. "Plowhorse" items are those that are popular but have a lower contribution margin; while they are frequently ordered, they bring in less profit than ideal. Thus, the focus should indeed be on adjusting the puzzle items to improve overall menu performance.