Bankruptcy was a potential reality for Golden Corral three-and-a-half years ago.
Its buffet operations and COVID restrictions did not mix at all, forcing hundreds of restaurants to shutter at once. The situation was so dire that the company allowed board members to resign if they wished.
Questions surrounded Golden Corral’s future as a viable company, but a steadfast resilience-filled leadership filtered down to franchisees. After several enhanced sanitation protocols, makeshift drive-thrus in parking lots, a couple of bankruptcies by franchisees, the net closure of more than 100 restaurants, and the removal of the well-known chocolate fountain, Golden Corral finds itself still standing in 2023. The brand grew by a net of three stores in 2022 and is setting record sales marks this year.
“The best thing about it is God has proven he loves a buffet,” says CEO Lance Trenary. “And so we’re here and we’ve gone from surviving to thriving. And we’re really enjoying our position with where we are financially. Our company’s balance sheet is stronger than it’s ever been in our 50-year history. We’re completely debt-free now. And it gives us the freedom to invest in all these things—our people, our technology, new facilities, new concepts, helping our franchisees grow their businesses faster and further than they’ve ever been able to do it. It’s just provided so many great avenues.”
In June, the 350-unit chain earned $102,000 in average weekly sales per store, a new record. Trenary estimates that five restaurants are on pace to reach $10 million in sales this year. If not that, definitely in the high $9 million range. Same-store sales are up 18 percent year-to-date versus the same period in 2022. Keep in mind that Golden Corral finished last year with 14 percent comp growth. Meal count is growing as well, so increased sales aren’t just a result of higher average check.
“I remember our founder called me, James Maynard, and he said, ‘I remember when we started, we just wanted to get to $10,000 a week, and here you are doing $102,000 a week,’” Trenary says. ” … We have to pinch ourselves every day to wake up and think about the exciting things going on at Golden Corral.”
The CEO attributes success to strategies that have been deployed since the early days of COVID, like not taking as much price despite feeling the same food and wage inflation as competitors. The company didn’t cut variety or abundance either. Trenary believes guests began to recognize Golden Corral’s value proposition and the consistent, made-from-scratch quality that didn’t waver.
Golden Corral put itself in a position to not significantly raise prices by meticuously focusing on all P&L line items. The chain worked hard to mitigate food costs, which is somewhat easier with a buffet since it can feature different foods based on what type of buy the company may get. The brand works closely with supply partners for the right purchase opportunities, but nothing that skimps on quality. Golden Corral did use some price to cover certain inflation, especially red meat, but over four years—from 2019 to 2023—prices have risen just 15 percent. Trenary says that’s 10 percent below the family dining category and $2.80 cheaper than the brand’s segment. Golden Corral’s ticket average is around $14 per person.
Over three years, the chain has experienced 20 percent wage inflation, but labor costs remain down compared to the prior year. That’s a result of work on technology, recipes, and the layout of bars. This summer, Golden Corral hired chief information officer Dawn Gillis, who will lead the transformation of the brand’s tech stack. That’s everything from POS to accounting systems and guest-facing loyalty programs. The objective is to reduce back-office time by 80 percent, and the company is well on its way to achieving it. For instance, Golden Corral is required to take temperatures of everything along its bar multiple times per day and enter the readings in the back office. The brand now uses an infrared device that takes temperatures and automatically feeds them into the system without managers having to touch anything.
Staffing is led by a mantra of “one team, one focus,” meaning everyone in the organization is treated with the same mentality and methodology. Golden Corral wants the CEO, down to the new accounting clerk, to have the same type of benefit packages, so that when the company performs better like it’s currently doing, anyone can celebrate the success.
Growing sales have allowed Golden Corral to invest more in employees. The goal is to create an environment in which no one wants to leave. In three years, the company has only lost a couple of people from its support center. The restaurant was certified as a “Most Loved Workplace” by Newsweek, alongside the likes of Google and Starbucks. It was also recognized on Yelp’s 50 Most Loved Brands of 2023.
“We have what we call a people-first culture, and we’re working very hard to find unique ways to take great care of our people so that they can continue to enjoy great careers with Golden Corral,” Trenary says. “And that’s a really important part of it because if you don’t have that ongoing training cost of new hires, the loss of productivity from bringing someone new in and trying to train them, then you gain so much in your efficiency. So we work just as hard on retention as we do anything in our business because we want our people to stay with us for long times.”
Outside of the P&L, the brand shifted its manner of attracting customers by introducing a multicultural approach to marketing and advertising. The chain took a hard look at its demographics, of which African American and Latino guests comprise a large portion. Latino customers are growing at a faster rate than any other group. Golden Corral attempted to match that expansion with its advertising. The chain put out commercials on Telemundo but dubbed it in English. The company discovered in focus groups that it was almost an insult to the Latino culture, so it responded by filming English and Spanish versions of its commercials using bilingual Latino actors. Additionally, Golden Corral uses an African American family to promote holiday specials.
“That multicultural approach is really resonating,” Trenary says. “We’re getting letters, we’re getting comments from our Latino guests in particular saying we appreciate the respect that you’re offering our community. And it’s paying off. Our Latino population in Golden Corral has grown by 30 percent over where it was.”
Along with the multicultural perspective, Golden Corral’s marketing is going multichannel. The chain did very little with digital prior to the pandemic, but it now accounts for 30 percent of advertising spend— all to reach guests where they are. That means Instagram, Facebook, Twitter, and even TikTok.
The brand’s recent Attitude & Usage study showed that it’s getting a significant amount of new trial from younger consumers that it hasn’t seen in years. This youthful demographic is handing Golden Corral “off the charts” scores on cleanliness, value, service, and food quality.
“Our net promoter score jumped so much that our analysts, which is an outside third-party group, had to go back and research it just to make sure that it was being done correctly because our analysts were telling us they’ve never seen that big of a jump in one 16-month reporting period,” Trenary says. “That is icing on the cake. Our operators are really delivering on the promise that we’re making to our customers through the media approach.”
“We’ve captured lightning in a bottle at Golden Corral, and I want to make sure that we figure out how to keep the lid on it,” says Golden Corral CEO Lance Trenary.
The unknown nature of the buffet at the beginning of the pandemic pushed Golden Corral to diversify. More than anything, COVID emphasized that customers have limited access to the chain’s products. Back in 2019, off-premises accounted for less than 2 percent of sales. There were no pickup windows or takeout/delivery stations. Golden Corral uses a weigh-and-pay system, in which guests fill containers as much as they can and pay by the weight of the food.
“As we researched it, what we found is that people were really wanting something in the fast-casual segment that could deliver a wholesome family meal replacement but that they could access quickly, easily, and how they wanted to,” Trenary says.
Golden Corral solved this by developing Homeward Kitchen, a fast-casual spinoff that took about a year and a half to get off the ground. Regarding its menu, Homeward provides a range of dishes, including comfort food main courses, salads, bowls, sandwiches, starters, desserts, and side items, much like what you’d find at its traditional sit-down establishments. The offerings blend the familiar with the novel, featuring staples like Slow-Cooked Pot Roast with Braised Vegetables, Golden Fried Shrimp, and Homestyle Mac and Cheese, alongside new additions such as the Cajun Mac & Cheese Bowl and Fried Buttermilk Chicken Sandwich available in Classic, Nashville Hot, Korean Style, and Honey Dipped variations.
The restaurant will debut in Southern Pines, North Carolina, in December with a small dining room and drive-thru window. Although the opening is still months away, operators are eager to bring the concept to their market. The company has already identified almost 500 trade areas across the U.S. that would fit the fast casual’s profile. The second and third sites are currently being developed.
A separate management team was brought in to handle Homeward. There will be some crossover with Golden Corral, but the idea is to launch it as an independent entity.
“Franchisees like to diversify their portfolio of restaurants,” Trenary says. “And so we said, ‘Well, they should never have to leave our system. Let’s give them something that’s 3,000 to 3,500 square feet that has a drive-thru window.’ We’re going to see about 75 or 80 in the dining room, but much smaller footprint, still really good AUVs we’re anticipating, about $3.5 million, and we think we can get there pretty quickly.”
The brand opened another concept, GC Grill House By Golden Corral, that goes back to its roots as a steakhouse. Trenary says the Lake Placid, Florida, location has performed well, but there are no plans for further expansion. Instead, the chain will focus on building out Homeward and its legacy buffets; a unit recently opened in Puerto Rico and there are additional restaurants under construction on both coasts.
Newer stores showcase the Gateway redesign and a modernized Golden Corral. The company sees double-digit sales growth every time a restaurant undergoes a remodel. Trenary noted that one unit in Garner, North Carolina, is seeing sales up 45 percent year-to-date versus the year-ago period.
“It’s interesting because a lot of landlords that were difficult for us to work with in the early part of COVID really couldn’t see the future for a buffet,” Trenary says. “And they wouldn’t make a deal with our franchisees to be able to give them any kind of relief in the early part of COVID. And so consequently, when the leases were up, franchisees had to leave. And now those same landlords are calling us back saying, ‘Well, maybe I was a little premature about exiting that business.’”
Trenary and the rest of his team know customers are going to keep eating out. Guests don’t change their dining habits, but they do alter how much they’re going to spend, and in today’s inflationary times, they’ve become quite discerning about where to visit. Gone are the days when restaurants could be one- or two-dimensional, Trenary says. It’s not enough to be known for great food; it has to be paired with hospitality, facilities, technology, and community involvement.
According to Trenary, executing a brand has become more complex than ever. But Golden Corral is up for the challenge.
“We’ve captured lightning in a bottle at Golden Corral,” Trenary says. “And I want to make sure that we figure out how to keep the lid on it to continue on with the great momentum that we’ve got going.”