Aktar Islam: “I made just £320 profit in the first quarter of 2023”
The chef has admitted that lunches are slow at his Jewellery Quarter-based Indian restaurant but says the dining room is “consistently busy” in the evenings. Instead, he puts Opheem’s poor financial performance down to spiralling costs and a hostile tax environment for hospitality.
“Food and energy costs have increased dramatically but our biggest problem at the moment is the skills shortage that has been caused by the pandemic and Brexit,” say Islam. “We’re having to hire two people to do one person’s job and pay them over the odds. I have chefs on £28,000 that can barely peel an onion.”
Islam believes the Government’s approach to taxation is compounding his problems, with restaurants generating a lot of money for the treasury through VAT and business rates while operating on razor-thin margins.
“On the face of it, it might look like restaurants are doing well in terms of the amount of money they turn over, but they aren’t making any money themselves they’re just fuelling the economy. The Government has a view that if an SME fails another one will take its place but that won’t be the case for restaurants soon. It’s simply not an attractive industry to be in at the moment. We need a fairer playing field.”
Launched in 2018, Opheem required an investment of £2.5m from Islam and his business partners. The chef-patron says they have “barely recouped” any of that capital expenditure so far and that as things stand it is difficult to see how they ever will.
“I’m starting to wonder what the point of fine dining restaurants is,” says Aktar. “And I’m not alone. A lot of my peers are in an even worse situation despite running some of the country’s most highly-rated restaurants.”
Earlier this week, it was announced that restaurant insolvencies had risen exponentially as business owners battle with weak demand and rapidly rising costs.
Spending across the space fell 7.6% in April, as consumers cut back their discretionary spending following a 5.6% sales drop in March.
In the past week alone, long-standing restaurants including Bully’s in Cardiff and Artichoke in Chester have both closed permanently, with owners for each respective business blaming rising cost pressures.
A full interview with Islam will be published later this week.
