Unlimited Food Restaurants or buffet restaurants, a concept that originated around the 16th century, is gaining momentum once again. A unique concept where customers can choose between a variety of dishes, it usually includes self-service. Thanks to its versatility, varied food options and unlimited servings at a reasonable price, buffets continue to be one of the most popular choices for customers. Large hotel chains have since extended buffet services to attract more customers. However, many Buffet Service Restaurants like Barbeque Nation and Band Baaja Baaraat have been persistently upping their game by offering unlimited buffet meals at reasonable prices to their customers. 

While buffet restaurants are becoming a popular choice for customers, introducing buffet service for a new restaurant may be advantageous or disastrous. Therefore, before deciding whether a buffet-style business model will align with your restaurant goals, consider their pros and cons to decide whether this restaurant concept works for you. 

Pros And Cons Of Buffet Or Unlimited Food Restaurants

Unilever Food Solutions suggests four common types of buffet services in restaurants.  

• Simple Buffet – As the name suggests, it is a simple buffet where guests serve themselves from a variety of food options at a buffet line. Restaurant staff is available to help guests with minor requests.

• Station-type Buffet – Beverages are offered to the customers by servers while diners can avail everything else from the buffet table. 

• Modified Deluxe Buffet – Here, buffet tables are set with cutlery. Servers offer beverages, coffee, and dessert to the guests at their tables. All the other food items are provided on the buffet line.

• Deluxe Buffet – Servers offer appetizers, soup and/or salads and beverages to diners at their tables. Customers can choose from a multitude of main course options and desserts from the dishes displayed on the long table.

Here are the advantages and disadvantages of buffet restaurants

Benefits Of Buffet Restaurants 

Saves Labor Cost: The emphasis of buffet service restaurants is more on food than services. A restaurant operating a buffet service can serve a large number of diners with minimal staff. Even though servers would be needed for serving appetizers or beverages to the guests, the requirement for the front-of-house staff is less compared to table services. With fewer servers, you can bring a significant reduction in labor costs and concentrate more on improving the quality of food being served to the customers.

Attracts more customers: One of the main reasons for customers choosing unlimited restaurants is that they are cost-effective. Buffets make it easier for restaurateurs to offer a variety of dishes to their guests at once. The value pricing of buffet meals for the array of food options it provides makes it a steal for customers. When compared to plated servings in table service restaurants, having the same variety could cost them more. Overall, buffet restaurants are a popular choice amongst corporates and families. As these restaurants are attracting more customers, it makes the buffet concept more profitable. 

Reduced Inventory Costs: Preparing buffet meals requires the consumption of inventory quantities in bulk. There is less spoilage as the inventory levels are restocked in a timely fashion. Buffet Meals also allow the chefs to experiment and rotate the dishes, according to the inventory levels. Buffet restaurants offer diners a wide variety of food options to choose from. A tasting menu like arrangement limits the need to alter food according to customer’s preferences and saves the consumption of inventory to provide extra portions. 

Improves profit margins: Buffet restaurants can help restaurateurs in cutting food costs and increase their profit margins. However, it greatly depends on menu innovation. As long as restaurant operators understand how to price their buffet menu competitively whilst offering value to their customers, the buffet restaurant business model can increase profit margins substantially. Buffet restaurant chains like Barbeque Nation have priced their weekday buffet menu slightly lower than the weekend menu. This attracts customers even on the slow days.

Drawbacks Of Buffet Restaurants 

Food Wastage: One of the most significant disadvantages of having buffet service is the wastage of food. A buffet meal typically requires large quantities of food offering single or multiple cuisines. However, there is no guarantee of the entire meal being consumed on a single day. Oftentimes, diners tend to serve too much food on their plates which results in unnecessary food wastage. Food wastage is not only unethical but in the long run, it may lead to higher food costs and low profits.  

Difficulty in Managing a Buffet Arrangement: Managing a buffet arrangement requires proper management. Restaurant managers need to analyze the spaces for food presentation and readily maintain food safety. They have to ensure that the servers and kitchen staff are refilling the containers whilst maintaining hygiene standards. Unlike table service restaurants, where food is directly served on the tables right from the kitchen, restaurant staff has to keep a proper check on food temperatures for both hot and cold food items.

Customer Perception: In spite of the unique combination of multi-variety food and ambiance, diners may prefer table service over buffet service. A busy day in a buffet restaurant may attract chaos around the buffet line and result in mismanagement. Unlimited Food restaurants limit the scope of customizations for customers. The meal is prepared at once, and special preparation requests by customers might not be addressed. 

If you want to offer a plethora of great food options at reasonable prices to your customers, unlimited food restaurants may be a perfect choice. However, if you wish to offer remarkable services and a lavish setting of food and beverages priced at a premium, having buffet service at your restaurant might be an option for special occasions. But choosing whether to begin or expand your restaurant business to an unlimited food restaurant concept comes down to your restaurant’s business model. Before forming the decision, think about your restaurant’s long-term goals, consider the benefits and drawbacks of buffet services and make a wise choice!

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Exclusive Feature: Are you a hotel or a restaurant professional and do you offer a buffet breakfast, lunch or dinner at any of your restaurants? Have you ever wondered whether your buffet meals are profitable?.

Even if you did not offer them, are buffets worthwhile?

How would you know?

In this article, I will lay out a case for buffet offerings vs the traditional a la carte menus.

Let’s jump right in.

Traditional Restaurant Offerings

The most common offering of restaurants is the menu based one.

What is known in the industry as a la carte menu items.

These are individual menu items listed with a price for each.

Menu items could be food or beverage types.

More granularly, they could be based on meal periods.

What are meal periods?

Most commonly they are:

• Breakfast
• Lunch
• Dinner

Lunch and Dinner might further have multiple courses (with menu items) like:

• Salad
• Soup
• Entree (Main Course) and
• Dessert

A customer can order any single or combination of menu items in any meal period.

Note the word “combination.”

It will feature in our discussion later in this article.

So, what then is a buffet all about?

Let me introduce you to an example of the concept you may be more familiar with.

The Combo Meal

Ever been to a McDonald’s or Burger King?

If you have, you know if you order Chicken Nuggets, you will be asked if you want the Nugget Combo.

What is this Combo?

Well, it is more than one menu item bundled together.

For example:

• Chicken Nuggets
• French Fries and
• Soft Drink

What’s the big deal with this bundling concept?

It is a big deal.

By selling fries and a soft drink bundled into a meal combo with the entree that is the burger, McDonald's or Burger

King have successfully boosted revenue contribution.

How?

By selling more than menu items in a combination at one time.

The buffet is a restaurant’s version of the Combo meal example above.

Let me explain.

The Bundle Concept

A buffet spread is a bundle offering just like the Nugget Meal Combo.

It brings together the following generic menu items which are also available a la carte:

• salad
• soup
• entree
• dessert

The above is a generic buffet composition for lunch or dinner.

There can be more items added to the bundle depending upon what the selling strategy is.

But these can be considered basic.

We now come back to an earlier question.

What’s the big deal with a buffet?

Rationale for a Buffet Spread

Why are buffet spreads offered?

There are many reasons.

Let’s take first the obvious ones:

• ease of access to the customer or guest
• quick turnaround,
• visual attraction,
• more choices,
• unlimited quantity,

These are reasons which are a huge win for the customer.

I will, through an example later, prove how that is so.

So, the customer is clearly benefiting.

How about the restaurant?

Do they benefit from a buffet offering?

Or, does buffets make money for them?

Yes, indeed they do.

A powerful principle is at work relating to bundles.

The Buffet Revenue Bundle Concept

A buffet which is well conceived of and priced attractively is a major contributor of revenue.

How so?

Let me give you an example of how this works.

Illustration

Let us assume a Lunch Buffet in a 24 hour Dining Restaurant (Coffee Shop).

Items included are salad, soup, entree, dessert. Individual prices of a la carte items included in buffet:

• Salad $3.50
• Soup $4.50
• Entree $11.75
• Dessert $4.75
• Total of a la carte items (without taxes): $24.50

Now, assume that the buffet spread is priced at $20 (without taxes).

Advantages of the Bundle Strategy

Let us list the advantages of this strategy:

• Most critical one is for the guest:
  o saving of $4.50 with unlimited choice of menu items in buffet
  o this amounts to 18% discount based on a la carte total
• This is for the restaurant:
  o It need not sell salad, soup, entree, dessert individually.
  o in one shot, all items have been sold through a buffet offering.
  o This has powerful implications for revenue.
  o The restaurant also ends up selling more of the buffet spreads.
• Not all guests who choose buffet spreads consume every part of the meal.
  o Some may just have the entree and dessert or the soup, entree and dessert and similar combinations which do not include all the items.
  o This has implications too.
• The most powerful effect is that revenue contribution is higher when a buffet is sold than when individual a la carte items are sold.
• Simply put, revenues are higher with buffets sold.
• This is because of the combination (bundle) of menu items sold at one time.
• Apart from this increased revenue, there is a strong impact on margins and profitability. [See section later on Buffet Profitability].
• With a buffet laid out, restaurant outlet operates with less service employees.
  o This reduces labor costs and
  o boosts restaurant profitability
• With a buffet laid out, there is less movement in and out of the operating equipment
• For example, plates, dishes, chinaware, glassware and so forth) between restaurant and the kitchen.
  o This brings down breakages thereby boosting profitability of the restaurant.
• So, eventually the restaurant bottom line is boosted by all these factors cause by a buffet spread.

Revenue that consists only of individual a la carte items sold is less effective than a buffet sold.

As said before, the buffet is like a bundle.

The Buffet Bundle Revenue and Profitability

The increased revenue contribution from a buffet compared to individual a la carte items is clear from the above illustrations.

But that is not the only benefit.

There is a huge factor that boosts margins and profitability when a buffet is sold as a bundle:

• the additional variable costs for the revenue achieved are lower
• this increases profitability.

Finally, the most powerful implication of the buffet spread offering is this:

• more buffets sold in a particular meal period result in higher profitability.
• due to better contribution margins compared to individual a la carte items.

So, what is Contribution Margin?

Contribution Margin is based on the principle of the extent of contribution a revenue item makes to the total Profit.

It recognizes that to earn revenue, both fixed and variable costs will be incurred.

However, a change in revenue or sales quantity will only affect the variable costs.

Fixed costs remain unchanged irrespective of sales or revenue quantities.

As a result, additional sales of buffet meals will only incur variable costs.

This will lead to higher profitability.

Lakshmi Narasimhan Soundararajan is the founder of Financial Skills Academy a New York city based enterprise focused on hotel finance training, coaching and consultancy. Lakshmi has been teaching undergraduate and graduate courses for a decade at New York University, Jonathan M Tisch Center of Hospitality as an Adjunct Assistant Professor during Spring and Fall semesters. He teaches hospitality finance, business development among other courses.

Right from the time he was in school, Lakshmi had a head for numbers. In fact, he says, numbers talk to him and tell him stories. At the same time, as he fashioned his career in the hospitality industry, he worked closely with colleagues who did not have a financial background. He saw them struggle with numbers and fear them.
Lakshmi made up his mind there and then to commit his career to hotel finance training by simplifying numbers for the benefit of his non-financial background colleagues.

He is currently working on Financial Skills Academy Membership with the philosophy of assisting hotel middle managers, small business owners and students to Build Financial Skills, Knowledge and Ability in themselves.

His vision is for Financial Skills Academy Membership to be the Ultimate Learning Hub for Hotel Finance Training.

Lakshmi 's all-time favorite historical figure is Leonard Da Vinci and in particular Da Vinci's love for simplicity. While developing his membership site, Lakshmi based the value proposition for his hotel finance training courses on three foundational principles: SIMPLE. NON-TECHNICAL. USABLE.

Blog and eLearning Portal: https://www.profitsmasterclassblog.com