How to Price and Operate Your Restaurants 'All-You-Can-Eat' Buffet

Whether you know it by the old name of smorgasbord or the more contemporary salad or food bar, the all-you-can-eat buffet-style service is still a popular alternative to full-service restaurant service.

It is not limited to the "budget" steakhouse chains like Golden Corral and Ryan's. Buffet service is also used in country clubs and hotels for Sunday brunch and salad-focused commercial concepts like Sweet Tomatoes. The fact that customers can eat as much as they want and anything they want creates a challenge to the operator when it comes to arriving at a food cost and a price to charge. However, as this article will explain, it is not as uncertain and difficult as it may first appear.

What are the pros and cons of using buffet service over standard table service? The first thing that is likely mentioned as a positive is that buffet service will require fewer servers in the dining room and therefore save on payroll expense. While this is true, consider that dining room servers are paid the minimum wage less the tip credit. In states where the federal minimum wage is the standard, this means that servers are paid $2.15 per hour. Subsequently, the amount saved in labor is not going to be significant.

In this article, we look at the rules of survival for offering buffets and salad bars, where your profits can get eaten up as quickly as the macaroni salad. The first part of the article discusses general operational rules of survival, which you might heed. The second section digs into the pricing aspects.

Operational Rules of Survival

There is a food cost trade-off if you use buffet service. Food costs will be 4 percent to 6 percent more with a buffet than if you employ the standard order-taking system of full-service restaurants. The reason it will be more is because leftovers and waste will increase. When you cook to order, you eliminate having cooked leftovers and waste. Keep in mind that a buffet must be as fully stocked 5 minutes before closing as it is at the start of the meal period. Typically, food choices will be entirely different from those found on the regular menu and leftovers cannot be worked off with daily specials or in regular menu items, thus increasing waste.

You have to do large numbers to get an adequate gross profit return from buffet service. Full-service restaurants sometimes institute buffet service on busy holidays like Mother's Day and Easter because of the demand and the ability to service large numbers of customers more quickly than with cooked-to-order food. Other full-service restaurants convert to buffet service for brunch on Sunday mornings and early afternoons. However, they soon learn that if they do not have sufficient customer counts, the additional food cost can cancel out any labor savings.

The other issue you need to consider with offering buffet service is the investment required to offer buffet service in a full-service restaurant. Consider the cost of decorative bowls and platters for salads and desserts, chaffing dishes for hot foods, ice bins, dish dispensers, sneeze guards, propane cookers or even magnetic induction units used to cook omelets and pasta sauces. In addition, you will likely need to purchase or rent additional linens and table skirts, risers and decorative centerpieces. The cost of custom-designed hot and cold food buffets for restaurants like Golden Corral is a major capital investment. Are you willing to make this kind of investment for a single meal period?

The marketing value of the all-you-can-eat at one price can be an effective strategy to increase customer traffic. It is used more at the low- to moderate-priced restaurants with prices typically under $10 for adults. The exception is with country clubs and hotels that offer brunch and are typically priced in the mid to high 20s per person.

Sharing and doggy bags are not permitted. You need to be aware that all-you-can-eat pricing comes with some awkward and potentially unpleasant situations with customers who want to share their food with someone in their party who has not paid for a buffet. This requires explaining this to a customer, which never is a pleasant conversation because he will often not understand why he is not permitted to share as he would do it if he ordered off the menu. Not being able to take home uneaten food is considered wasteful, especially when they are told that you discard it anyway. (If carryout is permitted, pricing is usually based on the weight of the food, and will be discussed in detail in the second half of this article.)