Celebrity chef issues grim warning for hospitality industry as he closes most of his Sydney restaurants: ‘You just can’t make money’

As an ardent admirer of Opel Khan’s culinary prowess and resilience, I find myself deeply saddened by his recent struggles in the Australian hospitality sector. Having spent countless hours immersed in the flavors and stories woven into his dishes, I can only imagine the emotional turmoil he must be experiencing as he closes down most of his restaurants.

Chef, author and television personality Opel Khan has issued a grim warning for the Australian hospitality sector as he closes up most of his Sydney restaurants. 

Khan stated that food prices have risen by 40%, but we’re unable to raise our prices for customers. Additionally, wages and interest rates have both increased as well.

On Tuesday, the well-known personality, boasting a massive 2.8 million followers on Instagram, deactivated his Open Group site and granted an exclusive interview to the Sydney Morning Herald.

Previously, the site showcased multiple restaurants by Kahn in the Harbour City; however, it now returns an error message instead.

In May, the chef transformed his high-end Khanaa restaurant in Surry Hills into Bistronomie, which he advertised as offering affordable meals suitable for challenging economic periods.

It has now closed. 

Khan has abandoned his intention to establish a second Bistronomie location at the troubled Potts Point site, which was once home to Gastro Park and Antipodean eateries.

His hatted restaurant Metisse opened there in 2019. 

A high-end eatery, aptly titled using the French term for multiracial, debuted under the leadership of executive chef Benoit Lollichon, an alumnus of the esteemed Michelin-starred restaurant Guy Savoy.

Kahn informed the media outlet that he had moved from Metisse and chose to close down his quaint, small-scale pasta eatery known as Acqua E Farina.

‘A friend with lots of venues says you just can’t make money at the moment,’ he said. 

“For a brief moment, I plan to step aside for some relaxation, yet my passion for food and wine is unwavering. Rest assured, I might be back with another culinary venture.

As a passionate devotee, I’m personally taking steps to halt my empire’s growth and wait for the economic climate to improve, much like others who have the financial power to do so.

Meanwhile, smaller operators and family-owned businesses may be forced to shut their doors forever. 

The Bangladeshi-Australian chef announced that he’s secured new management teams for his previously shuttered restaurants: Acqua E Farina’s storefront is set to transform into a Vietnamese eatery, while the Surry Hills Bistronomie spot will be taken over by a Chinese restaurant owner.

He will, however, keep the doors of his beloved Pizza Boccone in Potts Point open.  

Following a series of restaurant shutdowns in significant cities like Sydney and Melbourne, we’ve recently seen closures such as several Hog’s Breath cafe branches, Epocha in Melbourne’s culinary hub, and Warike in Surry Hills within the past month.

The Sydney fusion restaurant that was born during the Covid lockdowns was famed for its ‘divine’ take on Peruvian-Japanese that had diners raving about ‘inventive’ dishes such ceviche of scallop, oysters and kingfish.

Amidst the crushing weight of the cost-of-living crisis, I can’t help but feel the strain that’s hitting our beloved eateries hard. Everywhere I look, restaurants and cafes are closing their doors at an alarming rate. Consumers are tightening their belts, watching every penny, while retail rents skyrocket, making it a perfect storm for these businesses struggling to survive. It’s heart-wrenching to see my favorite haunts disappearing one by one.

In other words, rents put a significant financial strain on food and drink establishments because they’re often found in bustling shopping areas. Changing locations for cheaper rent often leads to reduced customer flow instead.

The closure rates for food and drink enterprises were experiencing the steepest decline among all monitored sectors, as reported by the credit monitoring agency CreditorWatch.

In August, businesses in the industry were failing at a rate of 8.2 per cent.

In simpler terms, hospitality companies might face challenges due to increased interest rates, as people tend to cut back on non-essential expenses like vacations or dining out.

According to Anneke Thompson, the economy sector has worsened significantly following a period of improvement after COVID-19 lockdowns, as people had limited opportunities to spend on leisure activities such as dining out or traveling.

However, as mortgage payments and rental expenses have risen significantly, they’ve become a heavy burden on consumer spending, making it challenging for businesses to raise their menu prices enough to offset their increased costs.

Since January, overall business failure rates have risen by 17.3%, reaching a peak not seen since early 2021, during the heart of the COVID-19 pandemic. This translates to an increase in business closures that is now at its highest point in over a year.

The CEO of the Business Council, Bran Black, explains that it isn’t merely the economic conditions causing difficulties in managing a business; political choices also play a significant role.

At the business lobby’s yearly gala dinner on Tuesday, Mr. Black criticized the recent modifications in federal workplaces, arguing that they are acting as a hindrance to hiring new staff.

At the same gathering, Prime Minister Anthony Albanese countered by asserting that job growth has been robust due to the implemented reforms.

On his watch, it is anticipated that the forthcoming labor force statistics for Thursday will indicate a million new jobs have been generated, as per Mr. Albanese’s expectations.

‘We are proudly pro-business and pro-worker,’ he said in a speech.

A strong business environment is crucial for job security and decent pay because it fosters growth. Similarly, improving productivity relies on having a well-trained workforce and ensuring workplace safety.

Mr Thompson said Australian businesses were operating under extremely challenging conditions.

Businesses are experiencing stress due to reduced consumer spending, escalating prices, and rising interest rates.

Moreover, the persistently high failure rates could be attributed to a period of recovery from the pandemic’s impact, as stated by Ms Thompson. During this time, numerous businesses benefited from government initiatives such as JobKeeper payments and deferred tax office debt collections for companies.

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2024-10-08 10:55