The Buffet A La Carte Balance in Hotel Restaurants

Are You Leveraging the Delicate Balance in Your Hotel Restaurants?

By S. Lakshmi Narasimhan Founder, Ignite Insight LLC | September 11, 2016

As someone who has poured money into a restaurant as an investment vehicle, the owner is looking at a good return on that investment. Restaurant profits cannot match rooms accommodation profits and in most cases tend to be between one third to one half of rooms profits. It is thus critical that the restaurant product is well thought out and harnesses resident hotel guest patronage complemented by non-residents. A well balanced buffet and a la carte offerings in the hotel restaurant will go a long way in delivering that patronage factor as well as producing that return on investment the owner is seeking. A win win situation that owners and stake holders hold dear to their hearts.

Restaurant operations generically owe their sustenance in revenues and profits to the delicate balance between buffet setups (harnessing the power of the bundling strategy) and regular a la carte menus. That buffets are far more profitable than a la carte menus is indisputable, however, having a slick balance between the two is the trick to maintaining consistent revenue streams and profitability. An analysis of this tandem strategy.

The Buffet Philosophy

Buffets play a huge part in the sales mix offering in a food and beverage operation. A buffet spread is a high contribution margin item while at the same time delivering extra advantages like the lesser need to serve the customer (it is self-service), lesser staff deployment other than for replenishing the buffet (leading to lesser labor costs) and so forth. And of course the supreme benefit to the guest is that they can pick and choose from the spread. In particular, breakfast and lunch buffets provide busy executives strapped for time a facility to quickly complete a meal and get back to work. It is a win-win situation.

In fact, meal periods and their diverse offerings of breakfast, lunch and dinner at various price and profit points and often in a combination of buffet and a la carte menu items are classic examples of a powerful sales mix at work.

A La Carte Revenue Contribution

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Coming up in June 2019...

Sales & Marketing: Selling Experiences

There are innumerable strategies that Hotel Sales and Marketing Directors employ to find, engage and entice guests to their property, and those strategies are constantly evolving. A breakthrough technology, pioneering platform, or even a simple algorithm update can cause new trends to emerge and upend the best laid plans. Sales and marketing departments must remain agile so they can adapt to the ever changing digital landscape. As an example, the popularity of virtual reality is on the rise, as 360 interactive technologies become more mainstream. Chatbots and artificial intelligence are also poised to become the next big things, as they take guest personalization to a whole new level. But one sales and marketing trend that is currently resulting in major benefits for hotels is experiential marketing - the effort to deliver an experience to potential guests. Mainly this is accomplished through the creative use of video and images, and by utilizing what has become known as User Generated Content. By sharing actual personal content (videos and pictures) from satisfied guests who have experienced the delights of a property, prospective guests can more easily imagine themselves having the same experience. Similarly, Hotel Generated Content is equally important. Hotels are more than beds and effective video presentations can tell a compelling story - a story about what makes the hotel appealing and unique. A video walk-through of rooms is essential, as are video tours in different areas of a hotel. The goal is to highlight what makes the property exceptional, but also to show real people having real fun - an experience that prospective guests can have too. The June Hotel Business Review will report on some of these issues and strategies, and examine how some sales and marketing professionals are integrating them into their operations.