Gordon Ramsay’s Maze Restaurant in Melbourne goes into administration

Date: 22-08-2011

Maze Grill in Melbourne

It was sad to see that Gordon Ramsay’s Maze and Maze Grill go into liquidation this week. It really highlights some of the difficulties in running a restaurant. It doesn’t look like Gordon Ramsay had much to do with the day to day running of Maze, but with his name as a big drawcard, great location at Crown Promenade and a reported fit out and setup budget of $20 million, it is interesting that they couldn’t make money out of it.

According to The Age, Maze and Maze Grill turned over in excess of $14,000,000 and served almost 315,000 in the last year. These numbers look a little strange. It implies an average bill per person of only $44!

I looked around to see what the reasons could be. An article in cateringsearch.com stated that Maze has had a few upheavals in management, with chef de cuisine Josh Emmitt and General Manager Enda Cunningham leaving within 12 months of the restaurants opening.

If Maze did have that many people through in 12 months, it would be an average of 863 patrons per day between Maze and Maze Grill! It is difficult to speculate about why Ramsay was forced to put the operation into liquidation but if these figures are correct, there are some things to think about.

  1. The management upheaval may have meant that there was no one keeping their eyes on the books and the day to day profitability of the restaurants.
  2. What sort of pricing strategy is behind the menu? I doubt that the average bill per customer was $44, but at the end of the pay the business would have had to be losing money to be put in liquidation, so maybe that is an area that should have been looked at.
  3. Were the start-up costs just too expensive to bear? Evidently it was a $20,000,000 setup, which may have bearing from a bank loan and needing interest to be paid on it, so maybe the start-up costs were just too high.

This is one of those cases where it didn’t look like they needed more customers, so it probably was something related to one of the above. Crown Limited intends to keep the restaurants running. We will keep an eye out to see if more info becomes available.

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