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Restaurant competition gets tougher

THE number of people applying to open restaurants has continued to rise despite concerns that Perth has an oversupply of eateries.

A total of 57 restaurant licenses were granted in 2001/02, a 1.7 per cent increase from last year, taking the number of licensed restaurants to 704. Over the same period just two tavern and no hotel licences were issued.

Last year continued the trend for the past five years, during which time the number of restaurant licences granted has increased 45 per cent.

The figures were of concern to Restaurant and Catering Industry Association WA executive director Terry Bright.

“There are a further 1800 BYO and cafes, and the overall figure is far too many,” Mr Bright said.

“It’s too easy to get a restaurant licence. There is no needs test unlike the hotel and tavern licence. It’s a defacto moratorium for hotels and taverns.”

His concerns are backed by The Australian Foodservice Market 2002-2004 study undertaken by BIS Shrapnel that said while the foodservice industry is growing faster than the total market for retail food, the turnover per outlet will remain low unless some rationalisation takes place.

“The Australian foodservice industry is unsustainable under its present structure, and will be unable to resist substantial rationalisation in the short term,” the report says.

Australian Hotels Association executive director Bradley Woods said Perth could not have a viable restaurant industry when there continued to be a proliferation of licences granted.

“Perth has one of the highest number of restaurants, per capita, in Australia. It is hardly surprising that high-profile restaurateurs complain about diminishing business when there are more and more restaurant licenses being granted,” he said.

“The restaurant industry is not receiving the protection it needs at industry level, and it will negatively impact on all restaurants as a result.”

Liquor Licence director Hugh Highman said restaurant licences fell under a different licence category to hotel and tavern licences that meant applicants were not required to undergo the same obligations as an applicant for a hotel or tavern licence.

“Hotel and tavern licences are category A licences and the applicant must demonstrate that the licence is needed in order to provide the reason-able requirements of the public,” he said.

“For extended trading applicants we require that they notify residents within a 200 metre radius … we may expand that to include applicants wanting to change the use of the venue, wanting to put a bottle shop in a new function room.”

Mr Bright said that the Department of Racing, Gaming and Liquor should do away with separate category licences and have a level playing field for all applicants.

“Either open up the hotel and tavern licence procedure or implement a needs test for restaurants. Hotel and tavern licences are increasing in value whereas restaurant licences aren’t worth much at all, there are just too many of them,” Mr Bright.

Liquor Licensing director-general Barry Sergeant said it was not government policy to deregulate the liquor industry.

Mr Highman does not expect things to get any easier for hoteliers in inner-city areas.

“The act does not talk about how long the commercial operator or the resident has been in the area. In May 1998 the act was amended so that instead of needing 10 residents to object you now only need one,” he said.

“I cannot grant a licence if I’m of the view that a person that resides in the area will be unduly offended and inconvenienced. Residents have quite strong powers.

“It would be a very good idea for hoteliers to consult with the public. The East Perth redevelopment and the developments along Aberdeen Street are likely to cause friction.

“It becomes very difficult to balance the rights of the resident with the rights of the patron.”

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