Earlier this week, the parent company of Famous Dave’s won an auction to buy the wreckage of the company once known as Buffets Inc., which at its peak had an empire of buffet concepts with 650 locations across the country.
It has been reduced to six locations of a steakhouse chain, Tahoe Joe’s. The remaining buffet brands operated by what we now know as Fresh Acquisitions, including Old Country Buffet, HomeTown Buffet, Furr’s and Ryan’s, are all but closed down. All BBQ Holdings is buying is the intellectual property.
Do not expect BBQ to revive them, either. As my colleague Joe Guszkowski wrote, Dave’s was interested purely in Tahoe Joe’s. The kicker quote pretty much said it all:
“We have no immediate plans to reopen any of the buffet brands,” CEO Jeff Crivello told Guszkowski. “Those are just IP that came alongside the transaction.”
To make this clear: Four buffet brands with well-known names and a lot of childhood memories amounted to intellectual property throw-ins to a bankruptcy sale. And just to be clear that these brands are basically dead, try going to oldcountrybuffet.com.
The pandemic has surely hurt a lot of companies, and buffet concepts have been hit particularly hard. Souplantation and Sweet Tomatoes opted to shut down completely last year, sensing that it had little chance of surviving a pandemic that eliminated in-restaurant dining for a time and made consumers uncomfortable with buffets long after that. The salad bar chain Sizzler also filed for bankruptcy. Golden Corral saw multiple franchisees seek debt protection.
Yet the pandemic is not what killed Old Country Buffet, HomeTown Buffet, Ryan’s and Furr’s. The pandemic was only the final nail in the coffin. More than a decade of neglect was the real culprit.
While Souplantation and Sweet Tomatoes locked their doors quickly at the outset of the pandemic, Fresh Acquisitions shut down its buffet brands more quietly, only made known when the parent company filed for bankruptcy with just the half-dozen steak units. That’s just 1% of the locations Buffets Inc. had at its peak.
The company was largely undone by debt and poor restructuring plans during the pandemic, leading to multiple bankruptcies. The company was then sold in 2015 to an operator in FMP Management that appeared to have little interest in doing much beyond draining the brands of whatever cash they could. It spent almost nothing on brand development or marketing or even routine maintenance.
For instance, last year the company was sued by a landlord over a Furr’s location closed in 2019. Among the accusations was a leaky roof that went unfixed despite complaints from the landlord. It was also sued in 2019 for requiring employees to work off the clock.
Even after the pandemic, apparently, the company was moving cash around. Creditors for the concepts noted there were $12 million worth of “intercompany payments,” including some to affiliated companies that didn’t file for bankruptcy. In addition, creditors questioned the use of Paycheck Protection Program funds.
Buffets LLC received $10 million in PPP funds, according to ProPublica’s PPP tracker, a loan that has since been forgiven. Fresh Acquisitions LLC received nearly $3 million in PPP funds.
Buffet concepts certainly can survive with the correct focus on quality and service. Customers are perfectly willing to feed themselves from buffets if the food is good and not at the risk of getting soggy from a leaky ceiling.
Golden Corral, for instance, has not exactly had an easy time during the pandemic. But the company worked feverishly to keep afloat, testing just about anything to get business back—including drive-thrus and alcohol. In other words, it is making investments in the company. It’s the type of investment that has kept the brand perfectly relevant before it ran into the pandemic.
Brands can and do survive all manners of threats, including the broad consumer shifts that have supposedly made buffet concepts less relevant. But often the biggest threat is the ownership. In the case of Fresh Acquisitions, that ownership simply decided it preferred to keep a brand running and get what it could, while it could.