How to Calculate Cost of Goods Sold for a Restaurant
Learn how to calculate restaurant cost of goods using inventory, purchases, COGS percentage, variance reviews, and regular tracking for profitability.
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Learn how to calculate restaurant cost of goods using inventory, purchases, COGS percentage, variance reviews, and regular tracking for profitability.
Aug 31, 2026
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Discover how restaurants like Applebee’s and IHOP use menu innovation and value programs to drive sales growth and customer traffic.
Photo by Priscilla Du Preez 🇨🇦
Photo by Priscilla Du Preez 🇨🇦
Applebee's has demonstrated a successful strategy of introducing new entrees on a quarterly basis. By launching dishes like Bourbon Street pasta, Sizzlin’ Skillets and Steak, and Chicken Parmesan Fettucine, the restaurant chain keeps its menu fresh and enticing for customers. These innovative additions not only diversify the menu but also align with the brand's value program, such as the Two-for-$25 promotion. Peyton highlighted that each new entree has resonated well with consumers, attributing their success to increased footfall and customer satisfaction.
Photo by Priscilla Du Preez 🇨🇦
The Two-for-$25 value platform at Applebee's has played a crucial role in driving traffic and sales growth. By combining new menu innovations with attractive pricing, the restaurant chain has effectively captured consumer interest. Peyton emphasized the significance of merging menu creativity with value offerings, citing it as a pivotal factor in the brand's strategy moving forward. Despite a slight decrease in the value mix, the brand's commitment to maintaining an enticing value proposition remains unwavering.
Dine's venture into dual-branded IHOP/Applebee's locations has proven to be a smart business move. The opening of the second domestic dual-branded store in Uvalde, Texas, led to a notable increase in sales compared to the previous standalone unit. This success underscores the synergy between the two brands and their ability to cater to overlapping dayparts effectively. The streamlined construction process and reduced timelines further highlight the operational efficiency and financial benefits of dual-branded establishments.
Photo by Priscilla Du Preez 🇨🇦
While Applebee's has seen positive outcomes from its menu and promotion strategies, IHOP faced a weaker quarter in comparison. To address sales declines, IHOP has implemented innovative measures like the House Faves value menu and a barbell pricing strategy to balance traffic and average check growth. By bringing creative efforts in-house and targeting younger consumers through platforms like TikTok, the brand aims to reinvigorate customer engagement and appeal.
The restaurant industry continues to grapple with macroeconomic pressures that influence consumer behavior. Dine highlighted how guests are adjusting their spending habits, opting for lower-priced items and reducing orders of beverages and appetizers. These shifts in consumer preferences underline the importance of agility and adaptability in developing menu offerings and pricing strategies to navigate changing market conditions.