MCA’s Menu Tracker has given Steve Gotham the opportunity to look at the latest menu releases by top leading pub chains Hungry Horse and JD Wetherspoon

The two leading pub chains in the UK are JD Wetherspoon and Hungry Horse. Together they trade from just over 1,160 outlets, accounting for just over 2% of total pub numbers. Looked at by sales, this share rises significantly, up to 9%. However, given their value-led orientation, and the fact that the value/mainstream/premium price positioning pyramid within the pub market is heavily skewed towards the value base, then in terms of ‘market influence’, I would argue a figure in the range of 25%-33% would not be unreasonable. So, what I am building up to saying here is that their business decisions matter, and provide valuable cues (as well as challenges), to assorted competitors, and, of course, to consumers in helping to frame value perceptions. And now, in what appears to be a tightening market, what they are doing regarding price management is of crucial importance.

I am sure it will not just have been MCA’s eyes busy scrutinising the latest menu releases from JDW and Hungry Horse. For us, however, this task is certainly made much easier with the recent launch of our new Menu Tracker, and the ability to instantly assess seasonal menu changes and compare price differences regionally.

Annual restraint

So what has been happening on an annualised basis? With assorted input and operating costs rising, there is the skilful balancing act of passing on some price rises to consumers, but managing this to ensure perceptions of their brand’s price competitiveness and sales volumes, are not undermined. If we assume that cost price inflation is running at 3-4% and is set to broadly persist at this level over the year ahead, then with the latest spring menu price inflation running at c2% at JDW and c3% at Hungry Horse, the point could be made that it is business as usual. Indeed, it would suggest that these two are managing to maintain some restraint in the extent they are pushing price rises on to consumers.

Dig a little deeper, however, and several interesting points emerge:

■ Price rises have not been applied to all products, many have not changed but several include significant 5%-10% increases.

■ This year, Hungry Horse has made greater mention of entry price points by flagging a series of price messages across its menu, eg, starters ‘from £1.79’, lighter bites ‘from £2.79’ and ‘big plate specials’ ‘from £6.49’.

■ Wetherspoon, by contrast, uses on-menu price messages to draw attention to selected added-value deals, such as its classic beef burger available at £4.99 with a soft drink or £5.99 with an alcoholic drink. Indeed, it is not possible to buy many products at Wetherspoon without the option of an accompanying drink. As such, this complicates a direct price comparison with Hungry Horse.

■ Hungry Horse has selectively introduced more compelling menu dish descriptions to its latest menu. For example, whereas previously its jumbo scampi was rather basically described as ‘15 Whitby wholetail scampi pieces… ’, it has now been dressed up somewhat as ‘15 yummy wholetail scampi… ’, and the ‘gigantic gammon’ is now ‘a generous plateful of three 5oz gammon steaks… ’, as opposed to just ‘three 5oz grilled gammon steaks… ’, These are small and subtle differences perhaps, but just maybe, this application of the aggregation of marginal gains might be worth reflecting on in several pub and restaurant quarters.

Midlands benefits

Again, looking at a basket of 10 lines (though not quite the same owing to some differential ranging), what stands out is the strong use of regional pricing by the leading two pub groups. While I should stress this is by no means presented as a definitive guide to differential pricing by region or locally, what might be surprising to some is the breadth and depth of the price differentials that are evident. For example, a beef & ale pie is at least £1 cheaper in the Midlands than in London at both operators. A similar situation exists with warm chocolate fudge cake, though here, quite how exactly the same dessert can be offered at £2.50 in the Midlands and 60% dearer at £3.99 in London, might be regarded as highly “opportunistic” price management.

Tempting as it might be to say that consumers in the capital are subsidising customers’ eating out expenses in the Midlands – London prices are shown here as 15%-17% dearer (on average) than those in the Midlands (consistently the cheapest region) – this is not my main point. There are certainly added expenses and operational complexities to running an extensive programme of differential pricing. However, within the great British institution of public houses, here are two leading practitioners working on how best to manage price and profit opportunities around the country. Doubtless, they are not alone.

Time (to call) ladies and gentlemen please!

Please take note that the menu and price analysis team at MCA might just be worth having a conversation with, and the Menu Tracker a demonstration of, to help you better understand and identify where there might be some additional pricing opportunities – both regionally and nationally, and both up and down – to help your business optimise revenue growth.

At the very least, there could well be some handy internal cost efficiencies in your ability to closely scrutinise the price and product moves that are occurring in 150 pub and restaurant chains throughout the country.

■ Steve Gotham is the director of insight at MCA

For a demonstration of the Menu Tracker service, please contact Sophie Barber – 01293 846 552 or