Although you may have chicken parm on the menu, one of my favorite things is going to Woodstock Station on a Thursday night. Chicken Parm dinner is $5.99 and it's huge with bread, pasta, etc. and the chicken parm is topped with a slice of prosuitto (phenomenal). Needless to say, it's very affordable yet I still tend to have several beers while I'm there. I don't think they're losing money on this option.
Sidenote: I believe the Station has a $5.99 meal EVERY night. I think it's just that I love their Thursday night Chicken Parm. If you could consider doing something like this, I guarantee you'll get a ton of people in the restaurant. People will go for the special, yet not all in the group will want the special (happens to us every time) and we all order drinks as well.
Four of us a couple weeks ago at the Station: 3 chicken parms at $5.99, 1 full meal at $17.99, a blooming onion appetizer, and probably 10-12 beers between us. As you can see, what is sacrificed for the low cost chicken parm is made up for indirectly.
It's like anything, you simply need to get people INTO the establishment. Skelley's offers $.99 breakfast sandwiches (bacon sausage, and ham, egg, and cheese). Scale of 1-10 they're a solid 6.5. Not the best, but certainly great. Why offer at such a low price? Everyone goes in for this reason...what do they do when they're there? Buy their coffee, cigarettes, and everything else for the day.
I'm a business man, so I guess I tend to look at things from a business prospective. I understand you're planning on changing the menu, but these may be things to keep in mind. At the end of the day, my vote would be for a very low cost special like chicken parm that gets people in the door (perhaps even on a nightly basis).
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