On 21 May, 2019, more than one thousand workers at British superchef Jamie Oliver’s restaurants woke up to some distressing news: They no longer had their jobs because the business they worked for had gone bust.
22 of the 25 restaurants in Jamie Oliver’s restaurant group have been shut down, ranging from outlets on the south coast to restaurants in Birmingham and Edinburgh.
Tweeting about the news, Oliver said he was “devastated” by the decision and wanted to “thank all the people who have put their hearts and souls into the business over the years”.
I’m devastated that our much-loved UK restaurants have gone into administration. I am deeply saddened by this outcome and would like to thank all of the people who have put their hearts and souls into this business over the years. Jamie Oliver
— Jamie Oliver (@jamieoliver) 21 May 2019
The business environment has become increasingly difficult for many mid-market restaurant brands in recent years. Cafe chain Patisserie Value was forced to close 70 outlets last year, at the loss of 920 jobs, because of poor financial performance.
Hummus Bros, a healthy eating chain focused on the Lebanese dip, collapsed in 2018 after its owners failed to expand off the high street. Byron Burger has recently announced a £10m injection of cash to accelerate recovery after a particularly poor 2018, when 19 restaurants closed. The list continues: Gourmet Burger Kitchen, Strada, Prezzo, Carluccio’s, Café Rouge—all stalwarts of the restaurant game and all suffering heavy losses in recent years.
This begs the question: Is the mid-market restaurant chain model becoming unsustainable?
Too much, too soon?
Unite the Union, quoted in the BBC, said that businesses like Jamie Oliver’s are “particularly precarious” as they had “dashed for expansion” in recent years.
The number of group restaurants in the UK was reportedly up almost 30% in the five years to March 2019.
“As ever, it is the workers at the restaurant and in the supply chain who bear the heavy cost of boardroom decisions,” the Unite spokesperson added.
One former staff member at a Jamie’s restaurant, quoted in the BBC, said that staff were stretched too thin in the restaurants which were just too big. This combined with relatively high prices and a focus on one-off visitors—either through passing footfall or because of relationships with group deals—to lead to a general lack of excitement among customers about visiting the Jamie’s brand.
The way of the world?
Isabelle Szmigin, a professor of marketing at the University of Birmingham, analysed the fall of Jamie’s in an article on commentary site The Conversation. She writes that it’s difficult to sustain a restaurant, let alone a restaurant chain.
She also writes that Oliver’s vision was a particularly hard sell. When his restaurant chain was established, Oliver said he wanted to offer “great value and much higher quality ingredients” and “best-in-class animal welfare standards”.
Szmigin said that these values come with a price that not everybody can pay. “And those that can pay, cannot pay every day,” she added.
“Successfully running restaurants is hard and running a large number of them is a good deal harder.
“Being a brilliant young chef is one thing—running a business with thousands of employees—and a multi-million-pound turnover is quite another.”
Fading star power?
Jamie Oliver, now 43, has been a household name in the UK ever since he was spotted on a documentary about the River Café and given his own TV show.
It’s clear that his restaurant chain had been sustained by his brand. He made good use of his position in the past, earning plaudits for a documentary series on school dinners that led to a healthy eating revolution in schools.
But, there is a sense that the Jamie Oliver of 2019—saddled by food-related controversy—has fallen foul of the British public. His missteps in international food, such as releasing a brand of ‘jerk rice’ to cries of cultural appropriation and earning the ire of a whole country by suggesting that a paella should include chorizo, have made him a source of ridicule and derision.
Similarly, a recent venture with oil giant Shell earned accusations of hypocrisy, given Oliver’s praise as an ‘environmental champion’ by the United Nations environment programme.
The focus of many mid-market restaurant chains on figureheads opens them up to trouble should the leader lose a touch of their star power. Oliver was recently forced to shut the magazine Jamie, which had been running for almost 10 years—a sign of his fading star power.
Rise of eating in
Finally, food delivery companies, although saddled with their own PR difficulties, have exploded in growth in recent years. Customers—particularly millennials—are increasingly willing to order home deliveries, including from big name restaurants, rather than to venture out to a particular restaurant to try a meal.
This has led some brands to shift more of their staff to ‘off-site’ cookery stations—places that do not admit customers. Is this a trend that the casual dining experience is capable of overcoming?
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