The restaurant business is a fickle one, profits are low, but food waste and cost margins are
high. It cuts straight into profits even more with an All -You-Can-Eat Buffet type restaurant.
How do they do it and still make enough money to survive and stay open. Here are some amazing
facts on how All-You-Can-Eat Buffets make their money.
Cheap Eats
To understand the ins and outs of buffet style eating, we need to understand its origins.
The term 'buffet' comes from the French term meaning “sideboard', a piece of furniture
that was used to lay out food for quick picking. When visitors would show up without warning,
the kitchen staff would gather up whatever food was in the cold room and place it on
the side board for a quick snack.The ‘all-you-can-eat’ tagline was invented and popularized in Las
Vegas, by entertainment manager Herbert Cobb McDonald, who introduced the idea at the El
Rancho Casino at the Buckaroo Buffet. Next thing you knew, everyone loved Buffet style
eating. It was cheap and you could eat as much as you wanted. For the restaurants, it
saved them loads of money on staffing and food costs, and it was also a profitable way
to lure customers with cheap eats.
Strategic Lay-out
Another way all-you-can-eat buffets make money is by its strategic layout. At the front of
the buffet, certain items that are considered fillers or starchy foods are placed first,
dishes which include meat are usually found further down the buffet line. This is done
on purpose, so you can fill up on more of the filler items. By the time you reach the
end of the line, your plate is already brimming with starchy fillers that will fill you up
within twenty minutes into your meal. Since your plate is already pretty full, by the
time you reach you the meat dishes, you will probably take less. This is no coincidence;
this is purposefully done because the meats are more expensive to purchase. Less consumption
means more profit for the restaurant. Since their profit on food is already fairly small,
they can’t turn a big profit on a buffet diner with expensive food items and prime
cuts of meat. Fillers can be bought in bulk and used in large quantities at a fraction
of the cost, increasing the bottom line.
Seasonal Menu Changes
Most restaurants tend to change their menus based on seasonal produce. This is not only
done so you can enjoy a variety of items, but because produce is usually sold at cheaper
prices when in season. During summer months regional local produce is in abundance and
is more cost friendly. You will notice how most restaurant buffets have tons of vegetables
and salads in their buffets during the summer months. This is done to maximize on their
profits and save on expenses. They also collect data on what customers like eating, during
seasonal peak periods. They then adjust their menus based on what is popular and how much
quantities are required. For example, salads are in higher demand in January, and fish
is more popular on weekends. Vegetables are also purchased in bulk for virtually pennies. If
not consumed, they are recycled to make soups and casseroles for the next day. So next time
you are at a buffet, count the amount of vegetable dishes they actually have.
Monitoring Food Waste like Big Brother
There is a whole psychology behind the monitoring of food waste when it comes to the restaurant
business and buffets are no exception. These days with advanced computer technology, restaurants
are able to keep tabs on what their clientele are eating and how much is being consumed. They
keep tabs on popular dishes, which dishes generate more money, which are more cost efficient
and which dishes are duds. They are constantly tweaking and customizing their menus to maximize
profits and reduce waste. Food waste is also closely monitored. Buffet Restaurants try
to do their best to estimate just how much food each patron eats, they are always watching.
There's still a lot of food that goes into the garbage. Some restaurants have started
charging for leftovers to avoid this.
Small Portion Sizes
Another way All-You-Can-Eat Buffets make money is by cutting down on overhead expenses. Since
buffet food is prepared ahead of time in bulk or in large quantities, there is no need to
have the same amount of staff as would be required in a sit down restaurant. Buffet
restaurants can also get away with using less service staff. There is no on the spot plating.
Buffet restaurants basically know how much staff is required during busy periods, and
will hire accordingly. They are usually led by an Executive Chef, who doesn’t necessarily
need to be overqualified, since the food prep requires no presentation just layout. Further
savings lie in the amount of wait staff hired. Because a buffet is self-serve, less waiters
and servers are required. They also do not need to have much experience, as interactions
with clientele is limited to getting drinks and clearing tables. Less experience means
lower wages. Operating a buffet instead of a sit-down-and-order type restaurant also
allows for a quicker turn over of tables, since diners aren't waiting for food to arrive.
That's important during peak business hours, when lines for tables can turn into lost dollars.
Large Iced Drinks
Whether it be alcohol, soda, or bottled water most buffets do not include beverages in the
overall cost of the meal. Therefore, the cost of any beverages is added to the sum of the
total. While the profit margin on food is around 35% tops for restaurants, for drinks
it is as much as 90%. If you are a big drinker, sometimes the drinks on your tab can cost
you almost as much as the meal itself. Also beware, buffet foods are highly salted and
full of MSG, which make you extremely thirsty and likely to drink more. Furthermore, sodas
in particular are then filled with loads of ice, which also dilutes and reduces the actual
amount of soda you are paying for. So, you tend to finish up your drink faster and may
want to order another. Because you are gorging on food, you will also drink more. For those
big eaters, that means at least a couple of drinks per sitting adding anywhere from $5
to $10 dollars to your tab. It’s still a good deal, but it’s a moneymaker for the
restaurants. Some buffets used to include the cost of drinks in their buffet price,
but most have since stopped this practice, and for good reason (well at least for the
restaurant owner).
Eliminating Cost for Staffing
Another way All-You-Can-Eat Buffets make money is by cutting down on overhead expenses. Since
buffet food is prepared ahead of time in bulk, there is no need to have the same amount of
staff as would be required in a sit down restaurant. Buffet restaurants basically know how much
staff is required during busy periods, and will hire accordingly. They are usually led
by an Executive Chef, who doesn’t necessarily need to be overqualified, since the food prep
requires no presentation just layout. Further savings lie in the amount of wait staff hired.
Because a buffet is self-serve, less waiters and servers are required. They also do not
need to have much experience, as interactions with clientele is limited to getting drinks
and clearing tables. Less experience means lower wages. Operating a buffet instead of
a sit-down-and-order type restaurant also allows for a quicker turn over of tables,
since diners aren't waiting for food to arrive. That's important during peak business hours,
when lines for tables can turn into lost dollars.
Low Food Quality & Recycling
This may not come as a surprise, but another way All-You-Can-Eat buffets make money is
by cutting down on quality and recycling food. Aside from getting good deals from their wholesalers
on bulk seasonal produce, they also get deals on chicken, meat, and fish that are also bought
on the cheap. The quality is not always prime top of the line. They might use lower grade
cuts for the beef in a dish, chicken wings instead of chicken breasts, and bottom of
the barrel fish. The leftovers are also used the next day in soup, casseroles, rice dishes
and prepared salads. They need to have minimal waste in order to turn a profit. The price
and cost of the food has been totally factored into their profit margin from the onset. Basically,
they charge customers an amount that will cover their basic costs and more. If they
don’t do this, they will eventually go out of business. Choosing the right menu items
and putting out just the right amounts is not easy in a buffet environment. If the Executive
Chef is experienced, he can keep food waste to a minimum by timing replenishments thus
maximizing their profits. Managers are meticulous about their stock-keeping. If too much of
an item is prepared and sits in a chafing dish all evening, it's money down the drain.
The Illusion Keeps You Coming Back
They have you as soon as you get in line. Buffets are not an easy profit-making scheme.
It takes the right menu, the right balance between cost and quality, and meticulous attention
to operational details for these restaurants to succeed. It also takes a keen understanding
of the psychology of dining. There is a love affair with All-You-Can-Eat buffets, even
though there has been a decline in such restaurants in recent years. For kids it is the ability
to play grown-up and select their own food, with big eaters it is making sure that they
got their money’s worth. For some the buffet is a glamorous idea, it reunites family and
friends, without any compromises, there is plenty for every taste bud. The joy of eating
many different things at the same time is like an aphrodisiac. The industry banks on
this and knows they have you hooked. You will keep coming back for more. Be wary though,
some buffets are now actually charging more for the big eaters or those that simply excessively
indulge, this way you can’t cut into their pocket books.
Banning
Buffets do manage to make good money, whether it be with cheap inexpensive quality food,
less overhead, or whatever methods they are using at the given moment. The fact is that
not many people can eat two days worth of protein in one sitting, although there are
some who can. There have been people who have been kicked out of buffets for eating too
much. In 2004, a Utah couple following the Atkins diet was asked to leave a Chuck-a-Rama
after going back to the carved roast beef station for the 12th time. In 2014, the restaurant
chain Sizzler, which has since eliminated its buffet in many locations, did not use
the term “all you can eat.” Instead, Sizzler used “all you care to eat”. Buffets took
a real hit during the last recession and were one of the most bankrupted categories in the
restaurant business. Buffet owners have caught on and have increased their prices and many
are now charging more per person. If your markup is 33% and you have an average of 200
people, you are still turning a profit.
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