The economics of all-you-can-eat buffets • Hacker News Board

Re: The economics of all-you-can-eat buffets

#201

Post by therealdrag0 » Mon, Jan 27, 2020, 2:13 AM UTC

bobthepanda wrote: post #196

therealdrag0 wrote: post #192

Earlier quoted context omitted.

I mean delivery has always been a thing. Before the delivery-app-err it was maybe mostly pizza, but I don't see why delivery in general can't still be a major thing. Also take out is always an option!

It was never 80% of food though. It's not even really 80% today. If VC funding were to dry up I'd imagine either the higher delivery fees or the higher order minimums of the past would come back, and then consumers would respond to prices and reduce ordering out.

No argument there.

Re: The economics of all-you-can-eat buffets

#202

Post by lonelappde » Mon, Jan 27, 2020, 2:14 AM UTC

mcguire wrote: post #174

graeme wrote: post #34

Earlier quoted context omitted.

My expectation would be that if you’re used to operating in a high margin business you have ample room for error or fluctuation in conditions. In a low margin business, you don’t have such room for error, and you actually have to fluctuate with conditions. This isn’t a deal breaker: most business operate this way! But it’s scary for someone looking in from a high margin business.

You might think that, but errors and fluctuations tend to routinely cause high margin businesses such as software to collapse in large numbers. Think of the dotcom bust. I suspect part of the problem is these businesses flourish when the conditions are easy, but many don't have the experience or exceptional margins to survive long enough to adapt when conditions change.

The dot com bust was negative margin businesses.

Re: The economics of all-you-can-eat buffets

#203

Post by colanderman » Mon, Jan 27, 2020, 2:16 AM UTC

gradstudent wrote: post #187

BurningFrog wrote: post #150

Earlier quoted context omitted.

The other nice thing is if you're on some unconventional diet (keto, vegan, kosher, etc), you can pick whatever fits your belief system that day.

Buffets are terrible places to eat for a vegan or even vegetarian. Options are typically limited to simple salads, various types of potato (fried, baked) and occasionally pizza or pasta: i.e. cheap tasteless carbs. Besides limited variety, the other problem is you need to choose very conservatively. Lots of options have animal-derived ingredients and the staff are either clueless or there exists commonly a significan…

Exception: Indian buffets. Almost always, veg items are kept separate from non-veg, and of that, what's vegan is usually easy enough to discern (or ask about), the two major ingredients to avoid being ghee and paneer.

Re: The economics of all-you-can-eat buffets

#204

Post by jjeaff » Mon, Jan 27, 2020, 2:17 AM UTC

xenocyon wrote: post #132

The danger for consumers is assuming this is a zero-sum and that the converse economic goal applies to you (i.e. assuming that the consumer benefits by eating a lot or focusing on meat). I conjecture that after factoring in the economics of health and quality of life, the economic optimum for a typical buffet consumer is the same as for any other eater: to eat sparingly and in a balanced manner.

I think you would want to eat nutritionally balanced, yes. But you would also want to eat the most calories possible that would stick with you long enough to skip followup meals and not exceed your ideal daily caloric intake.

I can skip breakfast and eat a really big late lunch and won't need any more food for the rest of the day until lunch the next day.

Re: The economics of all-you-can-eat buffets

#205

Post by lonelappde » Mon, Jan 27, 2020, 2:21 AM UTC

mod wrote: post #43

PopeDotNinja wrote: post #33

I sometimes drink a stupid amount of diet soda. I know drinks are usually high margin, but I wouldn't be surprised if some places lose money on me. I went to a Denny's recently and tried to count the number of refills I got, but I lost count. This is the same Denny's I went to in college, where the waitress knew me. She'd drop two pitchers of Diet Coke on the table before she took my order. The epitaph on my tomb sto…

If the drink was $2 and served in glass, you'd have to have a 3-digit number of refills before they lost money on it, assuming they use a gun.

Including dishwasher and ice/refrigeration expenses?

Re: The economics of all-you-can-eat buffets

#206

Post by pytester » Mon, Jan 27, 2020, 2:22 AM UTC

graeme wrote: post #34

chrisseaton wrote: post #28

Earlier quoted context omitted.

> there are business people who are apparently content running a business with such slim margins ... I'm left wondering why anyone would even bother A percentage margin is expressed relative to the value of the sales. Low margin on high value sales is as good as high margin on low value sales, in terms of how much money you make. Low margin is only a problem in low value sales. Why shouldn’t people running a business…

My expectation would be that if you’re used to operating in a high margin business you have ample room for error or fluctuation in conditions. In a low margin business, you don’t have such room for error, and you actually have to fluctuate with conditions. This isn’t a deal breaker: most business operate this way! But it’s scary for someone looking in from a high margin business.

This is why the National Restaurant Association always lobbies furiously against minimum wage hikes - it will never destroy the restaurant industry but it sure as heck destroys actual restaurants.

Re: The economics of all-you-can-eat buffets

#207

Post by LanceH » Mon, Jan 27, 2020, 2:26 AM UTC

GordonS wrote: post #181

BurningFrog wrote: post #150

Earlier quoted context omitted.

The other nice thing is if you're on some unconventional diet (keto, vegan, kosher, etc), you can pick whatever fits your belief system that day.

I wouldn't be so sure about keto. Buffet restaurants rely on serving cheap ingredients, which essentially means carbohydrates.

It's pretty easy to get a selection of vegetables and chicken breast. Stay away from things like meatloaf which might be padded with bread.

Everyone's first thought about keto is all meat, but vegetables are (or should be) a huge part of it. It's just a cool benefit that a night of brisket doesn't knock you off your diet.

Re: The economics of all-you-can-eat buffets

#208

Post by dragonwriter » Mon, Jan 27, 2020, 2:27 AM UTC

mcguire wrote: post #174

graeme wrote: post #34

Earlier quoted context omitted.

My expectation would be that if you’re used to operating in a high margin business you have ample room for error or fluctuation in conditions. In a low margin business, you don’t have such room for error, and you actually have to fluctuate with conditions. This isn’t a deal breaker: most business operate this way! But it’s scary for someone looking in from a high margin business.

You might think that, but errors and fluctuations tend to routinely cause high margin businesses such as software to collapse in large numbers. Think of the dotcom bust. I suspect part of the problem is these businesses flourish when the conditions are easy, but many don't have the experience or exceptional margins to survive long enough to adapt when conditions change.

Perceived high-potential-margin businesses with lead time lead to speculative investment in low- (or negative-) margin businesses in the same field with perceived potential, which is sensitive to fluctuations in the broader investment climate (e.g., payoff timelines) or reassessment of profitability potential. That’s what the dotcom boom and bust were about.

The actual high-margin businesses wouldn't be taken out in the bust unless they were high margin only because they were selling into the boom.

Re: The economics of all-you-can-eat buffets

#209

Post by lonelappde » Mon, Jan 27, 2020, 2:29 AM UTC

diffeomorphism wrote: post #3

bobosha wrote: post #2

Makes me wonder how the "Paradox of Choice" works in this situation since the customer is already committed to purchasing. Does this lead to more-than-usual consumption (cf. the usual shying away from purchase in a Choice paradox scenario)

Isn't loss aversion more relevant to this? You already paid for all this, so you would "lose money" by not eating more.

You mean sunk cost?

Loss aversion from the buffet would depend on how much food is available, not how much you paid.

Re: The economics of all-you-can-eat buffets

#210

Post by AnthonyMouse » Mon, Jan 27, 2020, 2:31 AM UTC

bobthepanda wrote: post #196

therealdrag0 wrote: post #192

Earlier quoted context omitted.

I mean delivery has always been a thing. Before the delivery-app-err it was maybe mostly pizza, but I don't see why delivery in general can't still be a major thing. Also take out is always an option!

It was never 80% of food though. It's not even really 80% today. If VC funding were to dry up I'd imagine either the higher delivery fees or the higher order minimums of the past would come back, and then consumers would respond to prices and reduce ordering out.

This probably depends a lot on autonomous vehicles. Right now VC money is subsidizing deliveries, but that's mostly subsidizing the driver.

Especially for items like this, because if you take the driver out of the equation and create purpose-built autonomous vehicles that aren't intended to have human occupants, they can be much smaller and don't have to worry about passenger safety. You could have autonomous electric vehicles the size of RC cars delivering takeout to your door.