French restaurants not so haute Business: High-quality French restaurants are taking a beating. A chef with the Guide Michelin's highest three-star rating recently had to declare bankruptcy, the first such chef to do so.

Sun Journal

April 05, 1997|By John-Thor Dahlburg | John-Thor Dahlburg,LOS ANGLES TIMES

SAULIEU, France -- "We are selling dreams," French chef Bernard Loiseau says. "We are merchants of happiness."

For the three-star Michelin chef, one of the most celebrated of his generation, it's a risky, if rewarding, trade.

Balding and with the husky build of a rugby player from his native Auvergne region in central France, the 46-year-old Loiseau is taking time to chat before he leaves for Paris later in the day.

He plans to borrow 10 million francs, or about $1.75 million, he says, to build 10 more rooms this year in his roadside hotel-restaurant, La Cote d'Or.

The previous day, the chef spent the morning poring over plans with his architect, accountant and banker, not working with his saucepans or 25-member kitchen staff.

Loiseau is already squeezed by so much debt that he has been paying monthly installments of $56,000 to his bankers. "The average customer's check runs about 1,000 francs [$175]," Loiseau says. "It's not enough. What is that when compared to the number of people in the kitchen, the cost of the foodstuffs?"

For many of France's most celebrated and honored chefs, those who have garnered the highest honors in the Guide Michelin, this is truly a challenging time. The free-spending era the French call "the 30 Glorious Years" has come to a screeching halt, and more customers than ever are scrutinizing the prices before ordering.

The value-added tax on restaurant food adds 20.6 percent to an already stiff tab. Business lunches are down. With an unemployment rate of about 13 percent, even people with good jobs are apprehensive about the future. On top of everything else, the French, of all people, are watching their weight.

To reach Michelin triple-stardom, the greatest badge of popular recognition a French chef can aspire to, some chefs, Loiseau among them, took on plenty of debt in the 1980s. Loiseau is making ends meet so well at his inn in rural Burgundy that, he says with great satisfaction, he will make a profit and have to pay taxes this year. But for others, changing market conditions have had a calamitous effect.

Last spring, Pierre Gagnaire, one of today's most innovative chefs, had to close his Art Deco restaurant in the grimy industrial city of St.-Etienne, population 200,000, after becoming the first Michelin three-star chef in history to declare bankruptcy. He has since left St.-Etienne, 30 miles southwest of Lyon, and opened a new restaurant in Paris near the Champs-Elysees -- and a vastly larger customer base.

In October, Marc Veyrat, a self-taught chef famed for his use of mountain herbs that he gathers himself, shut his Auberge de l'Eridan on the edge of Lake Annecy near the Swiss border. He reopened only after the banks that had lent him $10 million agreed to cut the size of the monthly installments and stretch out payments.

For the record, Michelin maintains that it is interested only in excellence, not in swankiness.

In a headline-making event that highlighted some of the other costs of super-chefdom in a food-crazy but highly demanding country, Joel Robuchon, considered by some to be the finest French chef of the century, retired last summer from his jewel-box restaurant in the wealthy 16th Arrondissement of Paris, citing the unrelenting stress of his job and his need of a break.

"I noticed that many chefs -- and this is curious -- have died in their 50s of heart attacks," Robuchon, who turns 52 this month, explained at the time.

But if the costs of stardom have been high for some, the benefits can be heavenly.

"When it comes down to it, a third star [in the Guide Michelin] is the only fail-safe method for doubling business and joining the gods of haute cuisine," says food critic Alexandre Lazareff, director of the Council on Culinary Arts, a government agency designed to safeguard French gastronomy.

Those that don't make it -- the "quality restaurants" whose prices average about $100 a meal -- are the ones that are getting pummeled by the recession, according to Lazareff.

Saulieu, where Loiseau has officiated in La Cote d'Or's kitchens for the past 22 years, is 45 miles from the nearest town of any size. It is a market town of 3,000 people and a good place to work out the cost-benefit ratio of striving to own and run one of France's greatest restaurants.

In his successful attempt to hoist himself into the three-star class, Loiseau borrowed 30 million francs, or $5.25 million, to build new hotel rooms and construct a new kitchen and dining room. In March 1991, Loiseau won his third star. And such is the pull of a third star that La Cote d'Or's annual turnover rose by 60 percent, despite its remote location.

Business has continued to increase. He grossed $4.8 million last year.

From as far away as the United States and Japan, gourmets come to sample Loiseau's reinventions of Burgundian and other French fare.

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