Earlier this week, Jamie Oliver’s restaurant group went into administration, with 1,000 jobs being lost.
The UK-based group, which includes the Jamie’s Italian chain, Barbecoa and Fifteen, has been reduced from 25 restaurants to three.
Should Oliver have seen it coming?
Oliver was criticised over how he should have spent more time on the business and less on his status as a celebrity chef. It seems clear that he overexpanded—his restaurant group includes Jamie’s Italian chain, Barbecoa and Fifteen and numbered dozens of restaurants. His empire has been under pressure for several years with a steady drip feed of closures. In addition, he stopped the presses on his magazine, Jamie in 2017.
No doubt, escalating high street rents share some of the blame, as well as labour costs and business rates. Throw into the mix that the way we eat is changing. We’re dining out less and letting firms like Foodpanda and GrabFood do the work. Cooking at home is experiencing a resurgence in growth.
But fundamentally, the restaurant business has always been mercurial and not for the faint of heart. Margins are notoriously slim and a sure return on an investment is a unicorn. Those who do well, do so by either constantly evolving—anticipating rather than following trends—or delivering a classic with superb service and outstanding food. Oliver did neither of these.
Of course, the real concern is for the around 1,000 people who will be without a job, not to mention the knock-on effect for suppliers and other companies who provided goods and services for the group. Employees will be searching for jobs in a sector that’s in a massive slump—one that may be permanent.
This is not a surprise. Food trends have changed since the 2000s. More customers want healthy food. And they are often looking for something new. This doesn’t play to the strength of big chains like Jamie’s, where consistency is paramount.
In addition, the new generation of consumers are seeking unique dining experiences. They are looking for food with a story. This is especially true of millennials who value individuality, uniqueness, and adventure. Dining out is a way to experience food from all over the world and to share that experience with friends.
While millennials are often looking for adventures, they also value local foods. Whether locally grown produce, locally raised beef, artisan or handcrafted bread, cheese, or beer, millennials want to know where their food and drink is coming from and how the food they eat is harvested. They are also conscious of the fact that buying local keeps money in their communities.
Could the days of chain restaurants be numbered? Probably not, but the concept will change. If we have indeed changed the way we eat, where we eat it and when, then the casual dining sector as we’ve known it, may well and truly be a thing of the past. Winners will adapt and change, while losers will end up like Jamie’s.