The Real Reason Jamie Oliver's Restaurant Empire Is Collapsing

Owning your own restaurant is a secret dream for a lot of people, and when you're a celebrity chef, it might seem like you're being handed not only the opportunity, but a guaranteed success. That's not the case, though, and in May 2019 one of the world's biggest celebrity chefs — Jamie Oliver — saw his restaurant empire come crashing down.

According to The Guardian, only three of the chef's 25 UK restaurants will remain open, though the advisory firm called in to sort out the mess searched for a buyer for those remaining restaurants, meaning their fate has yet to be determined. The rest would be gone, immediately.

Oliver had this to say about the closures: "I am deeply saddened by this outcome and would like to thank all of the staff and our suppliers who have put their hearts and souls into this business for over a decade. I appreciate how difficult this is for everyone affected. I would also like to thank all the customers who have enjoyed and supported us over the last decade, it's been a real pleasure serving you."

And it has been just over a decade since Oliver's Jamie's Italian brand of restaurants first launched in 2008. How could such a popular celebrity's restaurant empire fall so far, so fast?

According to Bloomberg, the 2019 announcement of insolvency came with the immediate closure of Jamie's Italian, Barbecoa, and Fifteen London restaurants. In 2018, there had been another announcement — The Telegraph reported Jamie's Italian was closing 12 locations and asking for their rent to be lowered at another 11. They were struggling with massive debts, but finding out just what was going on with the celebrity chef's chain was difficult. Why? Because, it came out, the hundreds of people who suddenly found themselves unemployed were instructed to sign non-disclosure agreements preventing them from discussing anything about the situation — and that included making any comments about Oliver or his family.

That sounds odd, at first, until you learn that former staff members — many speaking anonymously — had come out to blame Oliver's brother-in-law, Paul Hunt, for the massive failures suffered by the restaurants. Only one person — former managing director of Jamie Oliver LTD, Tara Donovan — went on record saying that all the criticism was being put out there for a reason.

It's been a slow rollout of closures for Jamie's Italian over the course of a few years, and in January 2017, The Guardian reported that he was going to be closing six locations — including a restaurant in Aberdeen and one near St. Paul's Cathedral in London. The reason? It was reported that the closures were coming — in part — so Oliver could focus more on Barbecoa and international endeavors, and it was also in part because they were experiencing all kinds of "pressures and unknowns" following the Brexit vote.

To be fair, there are still a lot of unknowns regarding Brexit in 2019, but representative Simon Blagden said (via ITV) a huge part of the problem Oliver's restaurant were having was because of the collapse of the pound and an increase in the costs of importing ingredients from Italy. In order to stay viable, each restaurant needed to average about 3,000 covers a week — and those just didn't make the cut.

According to The New York Times, Oliver started looking for a buyer to help save his restaurants in late 2018 — though a buyer didn't materialize as fast as Oliver would have liked. Will Wright of KPMG, one of the administrators brought in at the start of the closures, had this to say:

"The current trading environment for companies across the casual dining sector is as tough as I've ever seen. The directors at Jamie Oliver Restaurant Group have worked tirelessly to stabilize the business against a backdrop of rising costs and brittle consumer confidence."

But they were fighting an uphill battle. In early 2018, The Guardian got a peek at court documents that detailed just how much Oliver's restaurants were carrying in debt — and it was no small amount. Jamie's Italian alone had £71.5 million ($90.8 million USD) in debt, including £31.2 million ($39.6 million USD) in overdrafts and loans, £41.3 million ($52.4 million USD) owed to various creditors (like landlords), and £2.2 million ($2.7 million USD) overdue to staff. Oliver's representatives were quick to call the debt "standard" for organizations, and stressed that there was no one out there actually waiting for money. Documents, though, suggested the writing was already on the wall.

When Oliver's chain faced insolvency in 2019, it was actually the second time it had gotten that bad. The first time it happened — in September 2017 — Oliver was able to pull off a last-minute save by dumping almost £13 million ($16.5 million USD) of his own money into the business.

And, he did it just hours before they were going to have to make the decision to pull the plug.

According to The Guardian, Oliver was — at the time — a bit mystified about what had gone wrong. He told the Financial Times, "We had simply run out of cash. ... And we hadn't expected it. That is just not normal, in any business. You have quarterly meetings. You do board meetings. People supposed to manage that stuff should manage that stuff."

In addition to that, it took another £37 million ($46.8 million USD) in loans and subsidies from other parts of Oliver's business empire to shore up the ailing restaurants, and Oliver called it all "the perfect storm: rents, rates, the high street declining, food costs, Brexit, increase in the minimum wage. There was a lot going on."

And it's continued to go on.

Here's the thing about celebrity restaurants: they rely heavily on the draw of the celebrity to get people in the door. Only Jamie Oliver has a tendency to make people very angry.

Take the UK's decision to put a tax on high-sugar soft drinks. He championed it, (via The Telegraph) and media outlets like the Spectator pointed out the hypocrisy: he still sold cookbooks that included recipes containing high-sugar desserts, and sold sugary drinks at his restaurants... just at a higher price than other drinks. Oops?

That's just the start, and almost everyone can find something in Oliver's past to be angry about. There's the time he united Spain in their collective outrage over his "paella" recipe (via The Guardian) and the time he was accused of cultural appropriation with his "jerk rice" (via The Conversation). Then there was the outrage sparked when he started to talk about why all women needed to breastfeed (via The Telegraph), the time he was sued by a beef processor for comments about "pink slime" (comments which led to an 80 percent sales drop for the company and 700 people being laid off, says the Independent), and the time he accused a West Virginia mother of slowly killing her children with food (via The Atlantic). He tried the same thing in LA schools, and fared less well: NPR says he was kicked out.

Why would any of the people he's angered want to go eat at his restaurants?

When everyone talks about Jamie Oliver's restaurant empire falling, they tend to talk about Jamie Oliver. But it's important to remember that other lives are being changed, too.

According to Sky News, 2019's insolvency means that around 1,300 people are now without work. And that's not the first time that hundreds of people have lost their jobs or been laid off because of the financial difficulties that developed around Oliver's restaurants.

When he closed 12 locations in 2018, The Telegraph reported that more than 600 people saw their jobs disappear overnight. And that's way more than they originally thought would be lost — according to the Independent, it was first estimated that the closure and restructuring plan was going to put around 200 jobs at risk, with many people going through consultation periods to be moved elsewhere within Oliver's companies. The resulting job loss is a tragedy that all too often gets overlooked when news like this hits the headlines.