Revealing Secrets. How Buffet Restaurants Make Money

Updated: Dec 11, 2020

Have you ever considered opening your own buffet restaurant? If yes, what drives you to pursue it? Acquiring adequate knowledge is the first step to undertake before opening any business venture. Most especially, knowing how to make profit while maintaining quality service is paramount.

You may also want to read my article on 'What Owning a Business Could Do To Your Life'.

Personally, our family enjoys dining in buffet restaurants. Primarily because we are attracted with the so many food choices and we perceive it to be a lot cheaper rather than buying separate items in the menu. Oftentimes, my husband and I would eat less or skip a meal prior going to a buffet. Not because we want to eat more than what we paid for, but because we want to savor the variety of food and its flavors. Then, every time we have relatives coming for a visit here in the US, we never fail to treat them in a buffet restaurant too. It has been a customary way for us to do so as we entertain our guests. Besides, who wouldn't want to have their tummy filled with a lot of choices!

All people eat; thus, an all-you-can-eat buffet restaurant can be highly profitable if planned, executed, and managed properly.

Reasons Why People Dine in a Buffet

Dinning in a buffet restaurant is very appealing to a lot of people. We have witnessed customers with voracious appetite grab heaping plates of food from the buffet tables, then leave behind half-full plates. This scenario repeats itself for several times during the dining period.

Buffet Business Management

However, before customers walk into your door, what really attracts them to do so? The following are the primary reasons why customers enjoy eating in buffet restaurants.

  • The wide array of food excites customers. Most buffets here in the US serve intercontinental and local dishes to attract more customers from different cultures and class. There are so many migrants everywhere so this is a great idea to cater different food preferences.

  • Seeking independence is inherent to men. Buffets use this psychology in the business as customers enjoy the freedom to choose whatever food they like and to try new delicacies.

  • Budget-minded hungry crowd are enticed since they only pay one price for a variety of food.

How Buffets Make Money

A buffet restaurant's business model is primarily focused on bridging the gap between what the customers desire to eat and what the kitchen can produce while not sacrificing to a negative profit margin. The owner must be fully aware that most customers would attempt to eat more than what they paid for. Hence, implementing cost control measures will keep the business profitable. But how do buffet restaurants really make money? Read through to know the secrecy behind managing buffet restaurants.

  • Less staff is employed since customers usually serve themselves. Furthermore, a buffet is able to accommodate more guests at a given period of time since customers do not require much attention from the staff. Low labor cost is the most obvious strategy to keep expenses low.

  • Wholesale food items can be purchased cheaper since menu is prepared in bulk. In addition, buffets can be flexible in serving cheaper seasonal foods.

  • Serving sizes are cut by more than half compared to a la carte portions.

  • Starches and vegetables, which are more filling for the stomach, are abundant and placed in large containers.

  • More expensive food items are pre-plated to control waste.

  • Expensive sources of proteins are also usually surrounded by cheaper food like vegetables, potatoes, noodles and rice. This strategic arrangement of menu often leads customers to fill their plates with the cheaper dishes.

  • Buffets use smaller serving utensils, plates, and bowls to control portion each customer takes. Managers should clearly instruct the crew to never place large kitchen spoons and ladles on the buffet table. Doing so may contribute to a waste of food and your capital into the trash can.

  • Serving trays are also smaller. Although they must be refilled more often, it sends a covert message that there is no lasting supply of food.

Downsides of Buffets

In any kind of business, there will always be possible downsides. You must be prepared to deal with these through adequate planning. The most common challenges entrepreneurs face in managing buffet restaurants include the following.

  • Food costing can be a challenge. It is hard to predict how much food each customer can consume. Men, generally, can consume more than women and kids. Perhaps it would also be interesting to note how many men, women, or kids eat in your buffet restaurant for a certain period of time and then evaluate if this has any direct relationship to your profit margin.

  • Volume of customers per meal period can be difficult to forecast. If you live in a country that has a winter season, you may observe that there are less customers during this period as people prefer to stay inside the house when it's cold. Volume, perhaps, can be more predictable in tropical countries.

  • Waste of food due to ample customer leftovers. In one of the buffet restaurant where we usually go, they placed a small laminated note on every table saying, "Please help us maintain our food at low cost by only taking food you can consume. Too much waste will be charged per pound." I think this is an awesome and appropriate way to control waste.

  • More maintenance work from the staff ensuring the food remains either hot or cold at the right temperature to prevent spoilage and to keep it palatable, keeping containers regularly filled, and maintaining buffet table neat and clean.

How to be Successful

To get competitive advantage in a buffet business, you can take into consideration the following suggestions.

  • Choose your location wisely. Look for an area that is densely populated. More traffic equals more potential customers.

  • Ensure that there is sufficient parking space to accommodate your guests. It would be inconvenient for diners to cross the street or walk far just to get into your door.

  • Know your competitors. Where are they located? As much as possible, establish an all-you-can-eat buffet where there is no similar business concept yet. It is harder to get customers when the market is already saturated.

  • Plan your marketing and sales strategies. Target a group of customers by allocating part of your restaurant for private gatherings such as weddings, birthdays, reunions, anniversaries, or business meetings.

  • Serve a variety of food. Consider including popular concepts from American, Asian (including Japanese and Chinese dishes), Mediterranean, and Mexican cuisines.

  • Be creative in food presentation by considering color and texture of dishes to be served. Make sure that it is appealing and palatable enough to make customers crave and come back for your food.

  • Remember, first impression counts and hospitality is your business. Train all staff to be professional, polite and honest at all times. In a Vietnamese restaurant where we usually eat Pho noodle soup, we observed the manager approaching customers and asking how's the food and if there's anything else they need. It makes the customers feel valued and it adds to a positive dinning experience in general.

  • Hire hardworking and dedicated staff. Remember that your staff is your business' frontliners, and their ability to render great services will directly affect your customer's satisfaction. Even if you serve palatable and affordable food, if your staff is lousy in customer service, it is most likely that your business will loose some customers along the way.

  • All staff must be properly educated and trained in safe food handling techniques to prevent food-borne illnesses. Managers must implement and maintain a clean environment especially in the kitchen, dining areas, and restrooms. In my opinion, the restroom's cleanliness somehow mirrors how clean the restaurant's kitchen is and how well staff follows sanitary practices. Of course, I wouldn't want to eat food prepared in a dirty kitchen. We were also really impressed in one of the restaurants we visited because the management provided extra toiletries in the restroom--not usually found in other places. They placed lotion, tooth paste and women's sanitary napkins that customers can use for free.

  • Always consider cost efficiency while not sacrificing quality. Your goal is to keep your customers happy and satisfied so they would come back to do more business with you. Also, consider seasonal fluctuations which may affect food prices.

  • Be innovative especially when new competitors come around. Always look for new ideas to improve your services. Hiring an acoustic singer or a guitar player, if your budget allows, can be a great way to entice more customers.

At the end of the day, leaving money inside your pocket and satisfying your customers are the ultimate aims of engaging into business. You can use the SWOT (strengths, weaknesses, opportunities, and threats) planning technique to help you get started in establishing your dream buffet restaurant. To financial freedom, cheers!

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