An article today – “Fine dining closures”, lamenting the closure of great eateries in favour of franchises and fast food.
The owners, well known and respected folks, lament the current trend but don’t understand it.
I shall explain.
The oldies who grew up with fine dining and earned enough to afford it, are closing in on retirement and moving into ‘saving’ mode with the prospect of no future wages.
The next generation had their job prospects outsourced and then trivialised (John Key, Lame minister of New Zealand) tried to reassure us that new jobs would be created in the ‘Service and hospitality’ sector to replace them. So we replace a potential career as an engineer, slowly improving one’s lot in life, for the insecurity of a zero hours, 3 month trial eternal life trapped as a dishwasher and are supposed to be grateful?. These people are struggling to afford ANYTHING on their wages (MacBooks and iPhones excepted – Their equivalent to a home and a car, and within their budget). Their future has been trashed. They rebel against the lifestyle formula of their parents because it is no longer applicable or capable of replicating their parent’s lifestyle. So they show the same loyalty they were shown by employers and politicians. They shop on price because they HAVE to. They show the same loyalty to brands and venues – None.
The upcoming generation will try to resurrect a decent society, using history and parental experience to guide them in a better direction, opposite to their parents. Sadly, the artisnal skills like cheffing and silver service will have to be learned from antique halls of knowledge and hand me down paperwork skills bound in card with glossy covers like vinyl records of yore.
Perhaps someone will archive YouTube videos to display these historic hand actions.
Then, another turn of the generational clock will provide a resurgence of interest in fine dining as the economy settles into a more rational and fairly spread version of wealth.
Fine dining is not dead, just beyond reach for a while. We need to grow taller and wiser, stop chasing the dollar and start valuing quality again.
Then, of course, the main elephant in the room is the landlord. The aspiration of property ownership has been buoyed with cheap money and an unreasonable belief that property prices only rise. Supported by black money from Chinese ‘entrepreneurs’ seeking to stash their loot safe from the regime and banks awash with bailout money seeking to make ever more profits from cheap loans to anyone who can breathe.
Landlords have forgotten the basics. If the tenant cannot afford your rent, they close their doors. Rents of 30% of turnover are beyond a joke. Mall owners gouging for advertising never supplied, 10% off the turnover in addition to the extortionate rent, based on imaginary ‘traffic’ figures. Can’t end well.
More and more I see empty shops in malls. They have run out of suckers to steal from. Rents HAVE to drop massively for it to work. Trouble is, they can’t drop the rent and admit reality as the banks will demand a cash injection to equalise the equity position.
What will happen? Landlords will have to go broke and the values of properties drop to make rents affordable if the industry (indeed, any industry) is to survive. It’s gonna take a long time.
Historically, the property price for a median house was 1.5-3 times the median wage. That property in Antipodean cities is at 12-15x tells you how far it is from the clifftop edge to the plains below.