FEDHASA Cape understates severity of Cape Restaurant closures!

Rey Franco, FEDHASA Cape chairman of the Restaurant and Catering Industry segment, seems to be out of touch with the segment which he represents, in claiming in Cape Business News that 27 new restaurants opened and only three closed down in the Cape in the past year!  The situation is much worse in terms of restaurant closures, despite far more new restaurant openings.

Our ongoing tracking of restaurant openings shows that new restaurant openings were greater in number than the FEDHASA Cape figure, at 80 openings in the past twelve months, and included Cousins, Thai Café in Stellenbosch and Sea Point, De Oude Meul Bakkerij, Frères Bistro, The Urban Garden, Goloso Deli & Restaurant, Goloso Pizzaria, Bar1, Tamboerswinkel, I ♥ my Laundry, Millhouse KItchen at Lourensford, Reserve Brasserie, The Rotisserie at Leopard’s Leap, Café Blanc de Noir at Brenaissance,  Moyo at the V&A Waterfront, Mischu, Cattle Baron in Paarl, Latitude33, Baked Bistro, Richard’s Supper Stage & Bistro, Deluxe Urban Café, The Eatery at Diemersdal, De Grendel Restaurant, Camphor’s at Vergelegen, Antipasto Bar at Antonij Rupert Wines, Kloof Street House, Orphanage, Peter’s House, Le Venue at JC le Roux, Mitico, Slug & Lettuce on Kloof Street and in Stellenbosch, Ali Baba Kebab in Camps Bay, 5Rooms, La Belle Café & Deli, Big Route Top Gourmet Pizza, Stables at Vergelegen, Vovo Telo, Glashuis at Babylonstoren, Hussar Grill at Steenberg, Dorpstraat Deli, The Boat House, Orinoco, Cassis Paris Salon de Thé, Dog’s Bollocks, Jackal & Hide, Saints on 84 Kloof Street, Sushibox, Mama Cucina in Riebeek Kasteel, Salzburger Grill, The Stall, Shimmy’s Beach Club, The Red Table Restaurant at Nederburg, EuroHaus, Merchant’s Café, Truth on Buitenkant Street, Deluxe Coffeeworks, No 6 Restaurant at Welbedacht, Simply Asia in Paarl, La Pentola in Hermanus, Lizette’s Kitchen in Hermanus, Vino’s in Wellington, Sacred Ground Bakery & Deli in Franschhoek, Col’Cacchio In Hermanus and Westlake, Christina’s at Van Loveren, four Vida e Caffè, Gourmetboerie, Kushi Indian Restaurant, Moksh Authentic Indian Cuisine, Alfama, Paulina’s Restaurant at Rickety Bridge, Wakaberry in Rondebosch and Kloof Street, Okamai at Glenwood, Café Dijon in Green Point, and Deli @ The Square in Paarl.

Restaurant closures were more severe in the past year than reflected (maybe Franco wanted to project a perfect picture of the Cape restaurant industry, or he is that out of touch?), with at least 29 closures as per our count, which included Vanilla, two Café Dijon in Stellenbosch, Sabarosa in Bakoven, Toro Aperitif Bar, Caveau on Bree Street, Gourmet Burger, Limoncello, Casa Nostra, Wicked Treats in Franschhoek, Bistro on Rose, Paparazzi,  Rhapsody’s, Cape Town Fish Market in Somerset West, Josephine’s Cookhouse, Wale Rose Lifestyle, Mason, Café Sofia in Camps Bay (all outlets may have closed down), Gesellig, Beads in Stellenbosch, French Toast Wine Bar & Tapas, ACT Restaurant, The Kove, Planet Green Salad Bar, Freedom Hill, Sapphire, Grilleri in Hermanus, Franschhoek Deli, and Illyria in Stellenbosch.

The article emphasises how tough the restaurant industry is, with rising cost of food, electricity and gas, rental, and staff a major challenge, as is the tightening budgets of restaurant patrons.  The restaurant industry is highly overtraded and fragmented, and Franco says that ‘keeping a restaurant above water (sic) has always been a tough challenge’.  He adds that only a few have a winning ‘recipe of setting, food, social placement and value proposition’.

He noted a trend of restaurants opening at the start of summer, with restaurant closures visible at the start of winter. His statistic of two restaurants opening for every restaurant closure knocks his own restaurant opening and closure statistics mentioned above.  He also has seen an increased demand of catering for children, and a focus on healthy and organic food.  Loyalty programmes work, and refurbishments keep a restaurant interior fresh, he advises.

The larger franchised restaurants have done well in the past year, the Spur Corporation’s sales having increased by 17,5% in the last six months of 2012, whilst the Famous Brands franchises of Steers, Debonairs, Wimpy, Mugg & Bean, and Fishaways jointly increased turnover by 13% last year.  It is the smaller independents that may face another bleak winter to come, starting early this year due to the early Easter, which is synonymous with the end of the summer season.

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com Twitter: @WhaleCottage

2 replies on “FEDHASA Cape understates severity of Cape Restaurant closures!”

  1. Deon says:

    I think it would be great if landlords and staff allowed restaurant owners to close during the off season to re-open when the season starts. In EU many shops, restaurants etc. close during winter just to open again in summer.

  2. Good suggestion Deon.

    Alternatively one would expect support in terms of a reduced rent in the winter months, for all outlets, as the winter affects every business. However landlords seem to have a tough reputation, and would be very unlikely to be so kind.

    Chris

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