To quote a well-known Dutch hotel/restaurant owner:
"They'll eat me poor but drink me rich". The margin on the food may be thin, but drink margins are usually more like 75-100%.
The economics of all-you-can-eat buffets
251–260 of 272 posts
Re: The economics of all-you-can-eat buffets
#252Earlier quoted context omitted.
The largest expense if probably seating and serving you, not the food.
Also what I was thinking. Their minimum wage is double the US and even fast food is quite a bit more expensive there. On the other hand they must be getting fish dirt cheap. I have heard even the youth hostels serve entire salmon for breakfast.
Yeah I'm leaning on that hypothesis quite a bit. Low amount of staff, high turnover for customers. Also I see they are doing something the autoamtion of making nigri rice piecies as well.
Re: The economics of all-you-can-eat buffets
#253I'm still at awe of the Sushi Buffet thing that you can see all around in Helsinki, Finland. So far I have not seen anything like it, anywhere else in the world. Usually the price you pay is 10€ for an unrestricted and no time limit access to eating sushi. And the sushi is incredibly okay! It's nothing compared to stuff you find Tokyo ofcourse, but the price for quality is literally unbeatable. And all this is happen…
In Helsinki and in Finland more generally, the owners of all-you-can eat Asian buffets are not paying their workers anything close to a normal local wage. The workers are either family members of the owners, or people from the same close-knit region, or even trafficked labour, and they work for a pittance. Since cost of labour is a key reason for high prices in Finnish restaurants, it is no surprise that the Asian bu…
Yeah I suspected this as a possibility, but do you have some kind of hard evidence on it? I do remember the case with the Nepalese restaurants last year tho, it was similar.
However, I would like to point out that this is a global phenomenon and I'd bet Finland has some of the least bad cases in this. Compare to some places like London where food is cheaper than Helsinki, but average salaries are higher. It's definitely about skirting regulations.
Re: The economics of all-you-can-eat buffets
#254Earlier quoted context omitted.
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.
Which seems absolutely crazy to me. I would have expected them to push for them harder than your typical org since such a sweeping change would affect everyone basically the same. Nobody would be immune from raising their prices and the value differential would nudge customers away from fast food.
I think it doesn't affect not-yet-open restaurants nearly as badly as existing restaurant owners. NRA doesn't represent the restaurant market as a whole it represents a % of restaurant owners that currently exist.
Restaurant workers are, of course, going to be fairly indifferent to restaurant bankruptcies especially if an existing restaurant is swiftly replaced by a new one that pays more.
Re: The economics of all-you-can-eat buffets
#255Earlier quoted context omitted.
They might also be optimizing for taxes by heavily re-investing, charging personal stuff on the expense account (like car/gas/travel)... That makes it look like they are doing badly while they are doing okay.
This would be clearly visible to investors because the company is accumulating assets.
1. It's unlikely investors are looking into small lifestyle businesses.
2. The company isn't going to accumulate many assets if the owners are paying for gas, travel, food, and rapidly depreciating assets.
Re: The economics of all-you-can-eat buffets
#256>The big buffet chains that once dotted the Midwest have been hit the hardest: Old Country Buffet is down to 17 of its 350 original locations; HomeTown Buffet has closed 217 of its 250 eateries; Ryan’s Buffet has downsized from 400 to 16. I am not surprised. I went to an Old Country Buffet about two decades ago during the time I was working in a hospital kitchen. I recognized a lot of their dishes from work, they wer…
That’s what I noticed too, it’s like no one working there even tastes the food, it’s just not good. Definitely not woRuth the price when you can a good meal for the same money at a lot of places.
Re: The economics of all-you-can-eat buffets
#257Earlier quoted context omitted.
it's pretty hard to make delivery work if you (the business) have to pay the delivery person yourself. the key issue is that one person just can't deliver that many orders in an hour. food has to be sent out soon after it is made so it doesn't get cold (although you can do some amount of staging by keeping it on top of an oven). once the food is in the car, you have an even harder time constraint to have it still be…
Here in the UK, delivery was standard well before apps—almost every local take-away offered delivery if you phoned up and ordered. Maybe just because the UK is smaller and so they need to cover less distance? I often see people talking about grocery delivery the same way, when all the major supermarkets have been doing it as standard here in the UK for years.
Certainly delivery was commonplace in the UK by the late 90s. It was unusual in the late 80s. Douglas Adam's first Dirk Gently novel (1987) has an American character who complains frequently about the lack of delivery pizza in London.
Re: The economics of all-you-can-eat buffets
#258Earlier quoted context omitted.
Fractional reserve is lending out money people give the bank. it's not free money for the bank; the credit is balanced by a debt. You can do the same thing if you convince people to leave stuff at your house and then you rent it out. Heck, every lessee on Airbnb is doing this. As is everyone who has a mortgage and an investment account.
A bank can lend out more than the total deposits they have under fractional reserve banking. This is literally creating new money.
Yep. The majority of the M0 money supply is created through fractional reserve banking as debt.
Re: The economics of all-you-can-eat buffets
#259Earlier quoted context omitted.
I’ve been to a few sushi buffets in Helsinki and I can guarantee it wasn’t surimi after googling to see what that would look like. It was almost entirely salmon and tuna.
That may be the case and I don't doubt your view, but you'd be surprised at how good the Surimi manufacturers are at producing "sushi analogs" these days ..
I assume crab rolls are a good target for that stuff?
Re: The economics of all-you-can-eat buffets
#260Earlier quoted context omitted.
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 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."
Exactly.