Foodie chiefs sound alarm over tsunami of new Brisbane venues – Courier Mail

Foodie chiefs sound alarm over tsunami of new Brisbane venues – Courier Mail

The courier mail

Anooska Tucker-Evans

September 14, 2024

100 new eateries are set to open within a 5km radius of the CBD before Xmas, with hospitality heavyweights warning the growth is “unsustainable” and government intervention is needed.

The bulk of the new openings will be in the Queens Wharf precinct in the CBD, while many others will be spread across the city centre, West End, Hamilton and Newstead, with Brisbane City Council approving 124 cafe and restaurant licences in the past three months alone.

That figure is despite Council data showing for every one eatery that opens in the Queensland capital, another closes.

A problem compounded by current cost-of-living pressures with consumers eating out less and reducing their spend, while business costs skyrocket.

“Do we need, with the population we have, 100 new venues opening? No. Can we sustain 100 new venues opening? No. The data tells us,” said hospitality advocate and coffee king Phillip Di Bella.

“All planning needs to be reviewed because, in hindsight, no, there shouldn’t be the amount of (food) licences handed out.”

Mr Di Bella is calling for regulation allowing only the number of venues that can be sustained by the population to be granted licences, similar to a scheme run by government authorities in certain parts of Italy. Alternatively, he said a small business association should be able to provide entrepreneurs with clear data on how many venues are in each area so restaurateurs can make an educated decision about whether it is viable to open.

High-profile hospitality businesses to close in Brisbane this year

“There’s a form of regulation that makes it become an ecosystem and they have this holistic view – I would love to see that,” he said, insisting it would help eliminate some of the 2000 eatery closures in Brisbane each year where staff, suppliers and landlords are often left out of pocket.

“If you take an average and say each business closure impacts 20 lives at least, that’s 40,000 people affected a year by people closing, just in one industry in one city.”

CreditorWatch chief economist Anneke Thompson said it was “high risk” to be opening 100 new venues at this difficult financial time, and predicted it would be a rough ride for hospitality operators.

“We don’t expect things to get easier for the food and beverage sector probably until at least mid next year until we see two to three cuts to the cash rate,” she said.

“Even one or two cuts to the cash rate won’t be enough to open people’s wallets.”

Ms Thompson said launching so many restaurants at once would most likely cause staff wages to rise, with supply and demand pushing labour costs up, while the venues would also be cannabilising each other, with only a set number of patrons to fight over.

“That’s one of the big risks that the food and beverage sector faces that other businesses don’t is that a business can be doing very, very well and then a restaurant opens three doors down and everything changes overnight,” she said, with figures released earlier this year by CreditorWatch predicting one in every 13 restaurants would close across Australia by May next year.

However, she did not believe government regulation on how many venues could open was the solution.

“I would say that isn’t a path you would want to go down because that’s basically a form of protectionism,” she said.

“Supply and demand and market fundamentals are supposed to naturally moderate supply themselves.”

Brisbane City Council Standards Chair Cr Sarah Hutton said council was not about assessing the need for a specific business.

“We want businesses to succeed in Brisbane and we will continue to work closely with local businesses and industry bodies to ensure we’re a small business-friendly city,” she said.

Hospitality heavyweight Dan Clark, of Brisbane restaurants 1889 Enoteca and Rothwell’s Bar & Grill and wholesaler Addley Clark Fine Wines, said 100 new restaurants within 5km of the CBD was “crazy” and that they would struggle with finding staff and rising wages costs amid an already “really, really hard” time in the industry.

“I think there’s no room for error at the moment. If you don’t get it right from the start and get the customer coming back to put a base under your business then you’re going to go south really, really quickly,” he said.

“It’s a weird position to be in to try to open up something in this environment.”

Mr Clark said he was also being very careful about who his wine wholesaling business was supplying to, preferring to reduce his risk by only supplying to quality, established operators.

Australian Restaurant and Catering Association CEO Wes Lambert said most of the 100 eateries to open in the next three months would be by experienced operators, who he believed would survive, but perhaps at the cost of smaller businesses.

“May of the new openings are by medium and large restaurant groups around the country that are extremely experienced, so we expect that there could potentially be further consolidation until economic conditions improve,” he said.

One of the new restaurants to open in the next three months is August in West End by first time restaurateurs Brad Cooper and Matilda Riek.

Mr Cooper, who has been a chef at some of Brisbane’s most loved restaurants, was shocked by the number of new openings, but optimistic of his venue’s success, believing its position in a former 136-year-old church would be enough to draw customers in.

He also believed the number of new opening was “a good thing”.

“I think there’s plenty of growth in Brisbane and there’s a lot of people coming from down south and I think Brisbane should really go for it,” he said.

Also “going for it” is experienced restaurateur Bonnie Shearston. After running venues around the world for about two decades, she is set to expand on her successful Brisbane burger business Red Hook, with new outlets including Dumbo in Hamilton.

However, she said she was being very cautious about the risks.

“Operators need to be quite smart about what they’re offering now and being a little bit aware,” she said

“We keep so on top of our numbers and details and that’s helping and is critical.”