Jul 31st, 8:30 AM - 9:30 AM


Menu Analysis for Coffee Shop Operation: Using Activity-Based Costing


San Juan, Puerto Rico USA


In the highly competitive coffee shop business a more accurate menu-pricing method is needed to maximize profit. By applying Activity-Based Costing (ABC) theory to original menu-engineering methods, managers of a business can be informed about the actual cost and contribution margin of each menu item. This study demonstrates the feasibility of a modified menu-engineering method using ABC theory applied to the operation of a coffee shop. The results show that ABC can be an efficient method for maximizing overall profit of a coffee shop business.