With over 500 UK jobs already being axed, the latest victim of the consumer crunch is Gaucho, the Argentinean restaurant group.
Analysts have said that, on average over the past year, two restaurants a week have closed, including casual dining, upmarket restaurants, and independent establishments.
Contributing to the industry’s turmoil is Brexit, as the 2019 deadline is fast approaching, with a decreasing value of the pound; this trend is likely to continue throughout 2018.
Factors that need to be taken into account include the World Cup, which unfortunately has had an unfavourable impact on the industry. Although the World Cup and hot weather have boosted our economy by £1.6 billion, those funds were not injected into high street restaurants. Consumers’ spending has shifted more towards pubs or eating and drinking at home.
Gaucho looks set to be one of the first major victims of this further decline in revenues.
The Gaucho group also owns 22 outlets of Cau, which serves burgers, steak dinners, and brunches with a Buenos Aires theme. Unfortunately, sales at Cau have also suffered and have fallen into double digits in just over a year amongst the heavy competition and squeeze on consumer spending.
Cau has 22 outlets in the UK that employ 540 people; consequently due to the current economic climate six of those will close immediately. The remaining 16 outlets will continue to trade while administrators look for a buyer. In jeopardy are another 765 jobs in the remaining restaurants and the group’s head office.
After desperate talks with prospective buyers failed to yield a suitable buyer, Gaucho group had no option and the whole group collapsed.
