Buffets Inc. talks turnaround

Buffets Inc. talks turnaround

The company reported a same-store sales increase of 1.7 percent for its third quarter ended April 3.

Buffets Inc., parent company to the Old Country Buffet, Hometown Buffet, Country Buffet, Ryan’s and Fire Mountain concepts, is plotting a turnaround after reporting its best sales performance in seven years.

During what was a bleak couple of months for much of the restaurant industry, Buffets reported a same-store sales increase of 1.7 percent for its third quarter ended April 3.

Chief executive Anthony Wedo said the turnaround, which is being fed by the “Plan to Win” the company began in July, covers a slew of operational, menu and hospitality changes at the Greer, S.C.-based Buffets.

“We have positive energy now,” Wedo said. “We’re no longer talking about closing stores and shutting things down. We’re talking about growth.”

In January 2012, Buffets filed for Chapter 11 bankruptcy [7] protection and closed 81 restaurants, or 16 percent of its unit base at the time. In December, the company hired Wedo as CEO [8]. Now, Buffets operates 347 restaurants in 35 states.

Giving guests what they want

Menu tweaks were a large part of Buffets Plan to Win, said Jason Abelkop, Buffets chief marketing officer. During the past 10 months, Buffets has revamped its menu, consolidating to a single menu called Real Favorites across its concepts.

“Items had been taken off the menu … that didn’t hold up well or that guests didn’t really like,” he said. “We followed up with our guests to get at the items they really wanted.”

The company also introduced a Fresh For You platform that features Mongolian Stir Fry, which added a customizable, freshly prepared option for guests. Previously, the menu’s lack of continuity created less predictability for guests and unnecessary complications for managers and servers as well, he said.

“Predictability was a big negative for us,” Abelkop said. “Guests didn’t know what they’d get and couldn’t assign value to it versus what they ended up paying … If they want meatloaf and popcorn shrimp, let’s give them what they want and at a very fair price.”

Additionally, Wedo said, new Thursday Family Nights have been a hit with guests.  Family nights, which often feature cotton candy, balloon and kids activities, have boosted sales on Thursday by as much as 20 percent.

“And, obviously, kids drag their parents in,” he said. “We believe our future is about getting families back into our store … That’s where we’re going to spend a lot of our time and hopefully that’s what gets communicated to the world.”

Improving hospitality

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Since Buffets customers often serve themselves, many servers often think of themselves less as hospitality staff and more as bussers, Wedo said. But that is poised to change.

“We’re turning this program upside down,” he said. The new server role will require employees to take care of guests once they are seated until they leave the restaurant.

Although back-of-the-house improvements are important, the front of the house, Wedo said, is where he is focusing improvement efforts.

Offering guests great hospitality is key to growth and customer retention, he said. “We want to create a focus on hospitality that frankly has never been here in the history of the enterprise,” he added.

The company has invested more than $10 million to address deferred maintenance at its restaurants. By the end of this fiscal year in June, the company will have remodeled 25 locations, Abelkop said.

Cultivating a culture of positivity

One of the most important aspects of the turnaround, Abelkop said, is the cultural shift from a struggling company to a company on the upswing.

“You’re talking about an organization with a lot of people who have never seen a period without a positive [sales] number,” he said.

“Nobody here is claiming victory,” Wedo said. “This is a very important step for our enterprise to demonstrate stability for the first time in a long time … in my view we’re out of the gate and racing.”

Mark Brandau contributed to this story

Contact Erin Dostal at [email protected] [10].
Follow her on Twitter: @ErinDostal [11]