Gordon Ramsay. He sells Gordon.
Gordon Ramsay's UK restaurants sold £100 million of food and made a loss. That is the best argument for how he runs the business.
THE GIST ON GORDON RAMSAY: "Gordon Ramsay"
How do you take £100 million and lose money?
Gordon Ramsay has 34 UK restaurants, including Petrus, Lucky Cat and The Savoy. This year he had record sales of over £100 million, up 3%, with an operating loss of £5.4 million.
Worldwide, he has 103 restaurants, made £152 million and a £14.4 million profit, up 12% on the year before.
Why is a British restaurant so hard to make money from?
You open it in Britain. The insane figure is that hospitality pays 82 pence in tax on every pound that comes in: rent, rates, wages, VAT on every plate. That's before you've even bought a chicken.
It's not exclusive to Ramsay. Hospitality lost 93,000 jobs in the last two years.
How does he make money without owning the restaurant?
If you're a famous chef, there are two ways to open one. You build it yourself with your own money and your own risk. Or someone else builds it.
A casino in Las Vegas wants a Hell's Kitchen. They build the building and pay the wages of all the staff. He supplies the name, the training, the menu and the shouting, and takes a cut. The deal with Caesars was 5% of every sale.
What is Ramsay really selling?
His company said this week that licensing and franchising is where the growth is. 24 series of Hell's Kitchen and a Netflix documentary are the marketing. The restaurant is where you pay for it.
The man who famously made the idiot sandwich has worked out that the restaurant is the expensive bit, but the name is the profitable bit. Next time you're in one of his restaurants, have a look around. He's probably not there, but he's definitely getting paid.
Would you eat somewhere because of the name above the door?
Your take. One tap, then see how everyone else voted.
Quick answers
Did Gordon Ramsay's UK restaurants make a profit?
No. With 34 UK restaurants he had record sales of over £100 million, up 3%, but an operating loss of £5.4 million.
How does Ramsay make money from restaurants he doesn't own?
Partners such as a Las Vegas casino build the restaurant and pay the staff. He supplies the name, training and menu, and takes a cut. The Caesars deal was 5% of every sale.
How many restaurants does Ramsay have worldwide?
103, which made £152 million and a £14.4 million profit, up 12% on the year before.
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