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The Naked Chef Faces Naked Insolvency

He opened the nation’s eyes to home cooking, he brought us his nan in the Sainsbury’s ads and he helped completely transform the way schools feed our kids…but none of that matters if your outgoings exceed your income.


We were sorry to read of the administration of one of the UK’s most well-known 23-year-old British chef.  Jamie Oliver and his brand deserved a better ending than administration on so many levels.  But in today’s Telegraph article, which you may have noticed is a source for many of our blog posts, we have picked up on the headline that his business empire will be moving into administration.


Of course, here at Shergroup we see many business owners who are trying their best to keep their businesses afloat but who can end up in the same boat as Mr Oliver.  Whilst his is a high-profile case, we see smaller restaurants who end up with judgments against them from all sorts of suppliers, including catering firms and wholesalers.


For businesses who are supplying restaurant owners there is an increasing need to keep a tight rein on the amount of credit extended.  Just as we see that Mr Oliver’s brand has been affected by increased business rates, competition, and discounting, so a much smaller restaurant on the high street is going to be challenged by the very same factors.  Whilst Mr Oliver’s brand could pump cash into the business to try and adjust for the lack of cashflow (which is in reality a lack of paying customers on seats), smaller restaurant owners may not have the same resources.  This in turn leads to bad debt and ultimately judgments which need to be settled.


Jamie Oliver’s U.K. Restaurants Bankruptcy

It is not unusual for enforcement agents to remove and sell the contents of a restaurant.  Often the attendance by enforcement agents is a wake-up call to the proprietor that something needs to be done to address the restaurant’s trading position.  Second hand catering equipment has a low auction value, and it is not an ideal situation to be trying to recoup a debt from the sale of a restaurant’s bits and bobs.


Instead suppliers to restaurants should be monitoring the amount of credit extended, and if possible, identifying restaurants that are busy and full of customers as opposed to those that are not.  Researching popular places to eat has never been simpler with the rise of resources such as Trip Advisor and online reviews.  If a restaurant flags up as a risk in meeting its obligations, preventative action is better than trying to recoup post judgment.  In Mr Oliver’s case, HSBC’s exposure is looking like a £37M hole.  Is this backed by a personal guarantee?  Time will tell how all this impacts on Mr Oliver’s own personal wealth.


For restaurant owners we sympathize with the challenge of managing a business surrounded by competition which gives consumers so many eating out options. Maintaining good relationships with suppliers and banks is going to be vital in many cases.  Advice should be taken from lawyers on the giving of personal guarantees and where necessary business owners should take steps to protect their own assets.   Consider the worse case scenario and plan for that – as well as planning your success.  On the flip of a coin either can happen so it is best to be prepared for either.


We can only say we hope the future improves for Jamie Oliver.  He brought us a unique view of how to cook, he brought us his nan in the Sainsbury’s ads and he had some great branding.  But none of that matters if your outgoings exceed your income.  That’s true of every business and sadly for him, time has run out.  All the rest of us can do is learn from his mistakes and empathize.  He is not alone in facing these issues.

Content Writer​


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Last updated | 19 July 2023

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