Menu Close

To Discount or Not to Discount: A Guide for Restaurant Owners

Image of a chalk board with the words 'Discount Strategies for Restaurant Owners'

Discounting is a powerful tool in a restaurant’s pricing strategy, but it’s also a double-edged sword. While discounts can drive sales, attract new customers, and increase order sizes, they can also erode margins, devalue your brand, and train customers to expect lower prices. The key is knowing when and how to use discounts strategically to maximize benefits while minimizing risks. It’s almost Shakespearean: To Discount or Not To Discount… THAT is the question!

Below, we’ll explore four discounting strategies—when not to discount, everyday discounts, differentiated daily specials, and time-of-day discounts—to help you decide what’s best for your restaurant.

Blurred picture of a restaurant with the words Discount Strategies for Restaurant Owners. To discount or not to discount. That is the question.

When NOT to Offer Discounts

Discounting isn’t always the right approach. There are times when maintaining full price is the best long-term strategy:

  • Strong Brand Positioning – If your restaurant is positioned as a premium or unique dining experience, discounts can undermine perceived value. Instead, focus on quality, exclusivity, and exceptional service.
  • High Demand & Limited Supply – If you already have high foot traffic and demand, discounting may be unnecessary. Discounting during peak hours or on high-demand items can leave money on the table.
  • Healthy Margins & Profitability – If your restaurant is consistently profitable, price integrity may be more beneficial than discounting. Instead of lowering prices, focus on loyalty programs or value-added perks.
  • Targeting the Wrong Customers – Frequent discounts may attract deal-seekers who only visit when there’s a discount and won’t convert into loyal customers. Instead, aim to build long-term relationships.

Everyday Discounts (Combos & Value Meals)

Image of a keyboard with a 'discounts' key highlighting the strategy of online only discounts offered through the Dine Local platform.

Everyday discounts are small price breaks given on bundled items, such as meal combos. These encourage customers to spend more while keeping discounts manageable. In some cases you may offer these discounts through specific channels as well, for example offering a discount on Burgers with the purchase of a Beverage for dine-in orders or an online only combo to encourage customers to order through your lower cost takeout channels.

Pros:

  • Increases perceived value and convenience for customers.
  • Encourages larger check sizes by bundling high-margin items with lower-margin ones.
  • Simplifies ordering and speeds up service, improving customer experience.
  • Helps direct customer behaviours to improve your overall operational efficiency.

Cons:

  • May not feel “special” or drive urgency in the way limited-time offers do.
  • If margins are already tight, discounts on combos can reduce profitability.

Best for: Fast-casual restaurants, quick-service establishments, and restaurants that want to drive higher per-ticket spending without devaluing individual menu items.

Differentiated Daily Specials (Taco Tuesday, Wing Wednesday)

Picture of the calendar headings of the days of the week to show opportunities for daily special offers.

Daily specials allow restaurants to discount specific menu items on particular days, creating a recurring customer habit and boosting sales on slower days.

Pros:

  • Builds anticipation and a reason for customers to visit regularly.
  • Can focus on high-margin, easy-to-prepare dishes to maintain profitability.
  • Helps control inventory by promoting items that need to be sold.

Cons:

  • Can train customers to only visit on special days instead of at full price.
  • If not managed carefully, it can result in over-reliance on specific dishes.

Best for: Casual dining and themed restaurants looking to build weekday traffic without discounting across the entire menu.

Time-of-Day Discounts (Happy Hour & Off-Peak Promos)

Image of a tapas or snack sharing tray at a restaurant with the words Happy Hour to indicate a special strategy that can be implemented with the Dine Local platform.

Time-based discounts, like Happy Hour pricing or late-night specials, help restaurants drive sales during historically slow periods.

Pros:

  • Fills seats and consumes slack kitchen capacity and improves cash flow during non-peak hours.
  • Attracts a different audience segment, such as after-work professionals or night owls.
  • Encourages larger party sizes and longer stays, especially for bars and lounges.
  • Help to level out customer demand by encouraging takeout or delivery orders during non-peak dine-in times.

Cons:

  • If not carefully structured, could cut into regular, full-price sales.
  • May require additional staffing during slow periods if demand spikes.

Best for: Bars, cafes, and full-service restaurants looking to balance demand throughout the day.

Final Thoughts: Choosing the Right Approach

There’s no one-size-fits-all approach to restaurant discounting. The key is to match your strategy with your restaurant’s goals:

  • Skip Discounts if you have strong demand, premium positioning, or want to maintain price integrity.
  • Use Everyday Discounts (combos) to encourage larger orders without eroding margins.
  • Offer Daily Specials to build habits and attract repeat customers.
  • Implement Time-Based Discounts to optimize revenue during slow periods.

By carefully choosing when and how to discount, you can drive sales while protecting your brand and bottom line. The Dine Local team has the tools, data, and experience to help you shape your restaurant promotions for your takeout and delivery business to help you optimize your discounts without extra work. We support specialized coupon codes, automatic day and time discounts, special combo pricing, and more. Contact us today to learn how Dine Local can help!

Leave a Reply

Your email address will not be published. Required fields are marked *