Sunday, July 05, 2009

Thinking of running a restaurant? Think twice then... think again.

Gordon Ramsay profits plunge due to recession and being so ambitious.
• Celebrity chef sells Ferrari to inject funds into business• Pretax profits tumble from £3.05m to £383,325
Profits at Gordon Ramsay’s UK restaurants have plunged by nearly 90% and the celebrity chef has been forced to pump his own money into the business.

Ramsay’s latest company accounts show the restaurant chain came close to the brink as revenues collapsed while debt and tax bills mounted up.

The precarious situation caused the TV chef and Chris Hutcheson, his father-in-law and business partner, to inject the business with £5m. Ramsay had to sell his Ferrari to help fund the move.

Ramsay’s business problems were blamed on ambitious expansion as well as the closure of key London restaurants such as the Savoy Grill, as pretax profits tumbled from £3.05m in 2007 to £383,325.

The Savoy Grill was shut because of refurbishment at its host hotel, while the Connaught lease expired. The two restaurants alone accounted for a £9.5m reduction in revenues.

The firm said a restructuring of operations meant the group had “successfully undergone change for the better” and was now “well placed to grow its operation with a more stable capital base and a more manageable overall structure”.

Ramsay’s restaurant business expanded significantly in 2007 and 2008 but, in the year to August 2008, turnover dropped to £35m from £41.6m the previous year. Net debt soared from £4.06m to £9.48m.

A full review of operations was instigated in December as part of a refinancing deal with the Royal Bank of Scotland and to help the business get through the troubled economic times.

The cash injection from Ramsay and Hutcheson came after the firm had to pay £8m in VAT, corporation tax and PAYE. This has now mostly been repaid and will be completely settled by the end of this month.

Hutcheson said: “2008 brought its own challenges, not just for our group, but for the industry as a whole and the broader economy.

“Whilst the restructuring has benefited the group, the significant contribution and commitment of all 750 staff to the business has been integral to moving us to a position of strength.”
The firm said 25 staff were sacked as part of the restructuring efforts.

Of Ramsay’s 11 London venues, the Boxwood Café and his restaurants in Royal Hospital Road and at Claridges emerged as the star performers.

The restaurant at the Connaught hotel was closed after its lease expired, but two further ventures were opened in the capital: Murano in Mayfair and York and Albany in Camden.

The Narrow has had extra seating installed, Petrus is due to move to Knightsbridge later this year after closing last September, Maze has been fully refurbished and the Savoy Grill is set to reopen with the hotel in early 2010.

But La Noisette in Knightsbridge ceased trading in January this year and was described as a consistently underperforming site.
taken from THe GUARDIAN NEWS, July 3, 2009

3 comments:

Chef Nash said...

Nice post Chef... Well think twice could probably help but if u have so plenty money, why not... the problems with Ramsey's business is the Taxes and economy turn down... thats the problems with running restaurants in europe, america and many developed country... TAXES... hehe but in Brunei, i think if u have B$1M... open tah saja deh, esp when u have a good chefs... sure sellout... look at wywy, excapade, ayamku n many more... in less than 7 years dah banyak branch around brunei... well, what do u think? we make co-operation to get B$1M and open restaurant Clans for Chefs society?

Chef Pol said...

sala Chef NAsh:

haha, yatah kalau ugama tani inda strict in which, Cari duit ada berbagai cara, memang banyak melayu sudah kaya raya haha. Tani inda dapat main cuci duit, atau laundry duit.apa lagi menolong orang luar gunakan nama kitani membersihkan duit nya disini kekeke. inda lama tu bro. haha. kan pinjam pun kena dengan bunga nya.

$1 Million is too ambitious (and honestly berapa lama mau kumpul duit dapat sebanyak atu keke), and i wud just keep it n menyaara hidup hehe. What we can do is to take over "standard restaurant yang sudah gulung tikar" and run it. maybe ada balasan ehsan dari orang yang perjuangkan hak orang ic KUNING? hehe

so yea.. as i said, my drive is fading. i can't do it alone. I'm just happy to be able to cook and know what they are cooking. theres no such thing as secret recripes, so if there's young chef kan buka restaurant, we should support n open as many "secrets" as we can. kurang kurang pun yang maju orang tani jua :)

banyak branch doesn't nescessarily mean they actually make money. :p

and yes Excapade is number one restaurant for me. 2nd is Ilotus.

p.s: i hope you Naddy Gets a place :) thanks

Chef Nash said...

Thats the beauty of being a Bruneian, bro... hehe, MIB lah says...

Too ambitious, yes I agreed, but its just a figure to open our eyes bro... apa nya orang "aiming to the moon, at least hit the stars pun jaditah" n anyway... do u know anyone who own a restaurant yang kan gulung tikar as u maksudkan atu? I think if kana gaya n things, shud be a good start... hehe

And, apakan? ur mata kabur to drive kah? hehe nda paham, bebun ah... well, skilled we can tajamkan, sma mcm piasu tumpul wah, asah, asah n asah... tajam tu jadinya... jangan saja melukai diri sendiri... n yes, thats a good things that we keep supporting local chefs to the max... 150% agreed n will try the best to helps them semampu bulih...

P/s: i've talk to my sous chef n gets a positive feed back from them... so, if nada apa2 will mail her to tell the good news...