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Saffer restauranteur Gerrie Knoetze: A masterclass for budding entrepreneurs

Restauranteur Gerrie Knoetze has come a long way from the Free State gold mining town Odendaalsrus. After starting and running highly successful South African businesses (Roxy Rhythm Bar in Melville; Brown’s of Rivonia) he tried his luck in London with a steakhouse called Vivat Bacchus. Distinguished by its South African fare, the venture flourished until a double hit put Gerrie on the back foot. But almost a decade after foot and mouth fears blocked SA meat and the financial crisis sent his customers back to packed lunches, Knoetze’s two outlets are still in business. His story is one of entrepreneurial endeavour and overcoming the odds – with the interview sprinkled with the wisdom that comes from graduating from the school of hard knocks. A masterclass for any would-be entrepreneurs. – Alec Hogg

I’m with Gerrie Knoetze, having had a fantastic sirloin, which tastes just like a South African one here at Vivat Bacchus, which is one of two restaurants Gerrie that you own in London, but you’re well known for your restaurants in South Africa. Just to retrace a little bit, you started off in this business in the Free State.

Yes, Alec, I started in 1980 in Welkom of all places, which is close to my birthplace, which is Odendaalsrus. I went to school there and then went to Pretoria University. Then my father was not well and I had to come back to help him in the business.

He had a restaurant business in Welkom already.

He had a general dealer business and I had to help him for a while. He said I was useless in the evenings, not doing anything positive and productive, so he suggested I start another business. So we started Eagles for Steaks in Welkom in 1980, which was a wonderful little steakhouse.

Were there other steakhouses in Welkom there?

Yes, there were. A few predicted that they’ll buy our equipment second-hand in six months time and I don’t know if they’re still around. And then five years later my mum died and I decided it’s time to go to Johannesburg and take on the big town and I started a place called the Roxy Rhythm Bar in Melville, which was great fun. I sold that in 1989 and started Browns in 1993 in Rivonia, which I had till 2004 for a few friends and I together, we were a consortium, and then in 2005 I came to the UK and we started Vivat Bacchus in 2003 already, but in 2005 I came over and started running it full time.

The name, Vivat Bacchus, what does it mean and why?

Vivat Bacchus means glory to the wine god or long live the wine god and the origin of the name is interesting. It’s a phrase from a Mozart opera and it was the name of a wine made by Veenwouden, Deon van der Walt, the famous South African tenor who tragically died in 2007 or 2006. His winery, Veenwouden made the wine Vivat Bacchus and when we came to England and needed a name, we could hardly bring the name Browns back here because it was nicked from here to start with. We asked Deon if we could use the name Vivat Bacchus and he said “Yes” and we did and we started Vivat Bacchus Farringdon in 2003. We added the wine bar, the upstairs area in 2005 and in 2008 with immaculate timing, three weeks before the D-Day that the Lehman brothers fell over; we opened a London Bridge branch, so three days before the recession started.

Right in the City of London, and what happened to the bookings?

Well, amazingly it was quite robust, until December, we didn’t feel the difference much, but then January came, after Christmas and it hit everybody, slam in the face. We did an interesting analysis later on. We realised that in January of 2008 we sold more champagne than in the whole year of 2009 together, both branches.

It just shows and champagne became a swear word because executives were laying off people and they couldn’t be seen to drink fancy wine or champagne, so the businesses just came to a stop. Expense accounts were cut severely, whereas there were guidelines of wines of 40 Pounds before for lunch for entertainment, it went down to 20, or none and it was just amazing to me.

Is there a big business trade in both restaurants?

Yes, lunchtime to me is very important and where we are in the city, we only work with business people. Lunchtime business is important, people go out for lunch because they are sitting in the office all day or they have to entertain friends and colleagues, and then in the evening they have drinks parties, they have birthday celebrations or company celebrations of one sort or the other. Yes, it’s all business based. In the evening, Friday and Saturday, we get business from further away but our business is city-based.

So you’d have a good feeling of what the mood is like, certainly in the city, post-Brexit, any difference?

We have what we call the champagne guide to the economy. The more champagne we sell, I think the better the economy is and it’s been pretty dead lately. People have now completely reverted to South African sparkling wine; Graham Beck is a huge number at this stage. You save 15 Pounds on a bottle and the wine is as good as most champagne, so it’s pretty good yes, but to answer your question, Brexit has not really slowed it down, but I think there is a little bit of hesitancy in the air. It’s not easy to pinpoint what it is exactly, but the people are wondering what is next, I think we all are, but I think the business economy feels it more, the business crowd feels it more than just you and me or the man on the street.

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You have a lot of South African items on the menu; do you sell South African meat?

We used to sell a lot of South African meat, we used to have springbok, blesbok, whatever we could find on the menu and it was a great attraction, it really defined us, but in 2008 or 2009, it was discovered that there was foot and mouth in Botswana or Namibia (I’m not sure now) and upon closer inspection, the UK authorities realised that it’s endemic in the wild and that it is not just outbreaks, it is a problem and with the problems they had in the UK in 2000, when 160,000 head of cattle had to be destroyed, one can understand why they could not take any more chances, so it was simply stopped.

You cannot get meat from Southern Africa. Our ostrich comes from Spain now, but it is associated with South Africa. We now make ourselves more South African by having once a year a South African Festival, a wine festival and also we specialise in South African wines. We have 200 labels of South African wine and our sales are 89 percent South African wines. So yes, we are South African, I can’t get rid of my accent, or I can’t pretend it’s not. I come from the Free State for God’s sake, but I wear shoes now, so it’s going forward, yes.

No more vellies, hey?

No, real shoes now.

What about South Africans, who live in London, do you find that they make a disproportionate slice of your clientele?

Oh, we have a lot of South Africans, but I don’t think we give ourselves out as a South African restaurant. We have a South African connection, we have South African wine, but the food of a restaurant is mainly the big attraction and South African food is not a real big number, it’s braaivleis, isn’t it really and bobotie and stuff like that, so we’re really a steak-based restaurant now with lots of wine. We have 16,000 bottles of wine on the premises at Farringdon, so we specialise in wine and we find that the UK audience loves South Africa. Half the people have been to South Africa, half are going to South Africa, and they just absolutely adore it and at almost R20 to the Pound, you can understand why it’s very attractive in more ways than one. I often say, if you can get rid of the crime statistics, they wouldn’t know what to do with the tourists in South Africa, but that’s a different story.

What about the inbound tourists, more particularly the rugby players or those who come and play for a club like Saracens or the cricketers when they tour here, do they make a turn here at Vivat Bacchus?

Now and then we see sportsmen, but once again, we’re city-based and most of these events take place at Twickenham or at Lord’s etcetera and we’re not really that kind of restaurant. We don’t have a pub. We’re open weekends, but in the evenings only, so we’re not really geared towards that kind of audience, we’re really a city restaurant aimed at business people, so that is what it is.

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You’re a South African who has come here and made a business in the UK serving UK people because often people think they can come from South Africa and only treat, or look after the South African audience. Of course, that doesn’t seem to be a great business proposition.

Well no, I think if you go to Wimbledon and to Southfields, you’ll find pubs where you’ll find 50 percent South Africans and we see those guys when they’re in the city, a guy comes in here and says, “Howzit Gerrie” and we know exactly what you’re talking about, but we’re in the city. If we had aimed at South Africans only, I doubt if we’ll be that successful. If we were on the river or in the suburbs, I think a different story completely and I also think the number of South Africans in London has dropped considerably. The visa requirements have changed completely, it’s now a tough thing to get my daughters to come and visit me.

In the past I could get all the vacancies in the restaurant filled with South Africans, Australians and New Zealanders, now we have none because they just can’t get in. So yes, let’s hope that changes because if Brexit comes to its fruition, or to be completely done in the hard Brexit, then maybe the flow of immigrants of Europe or Eastern Europe will have to stop. Then we’ll have to find immigrants from somewhere. It’ll be fantastic if we can get South Africans in again because they were the backbone of our business. Now we work with Romanian, Bulgarian, and Polish people. It’s changed our setup a lot and it’s a pity.

Now you fell into this business in a way, as you’ve explained a bit earlier, but at the heart of it is entrepreneurship. What is it that keeps you optimistic, what is it that elevates your emotions because an entrepreneur has to believe that when he opens his doors today, he’s going to get good business?

Yes, I think opportunity abounds really for a guy who wants to work hard and put his mind to it. I just believe London is not much different from Johannesburg. There are millions of business people that want to go out and have a good meal and have a good time and want to be looked after in a really good way and if you have a big smile and you look after the guy day after day, he’ll come back. It’s very simple, I think.

Being a Saffer, does that give you an advantage or is it a disadvantage?

I think it’s a big advantage, we are casual, we are informal and I mean initially it was a bit of a problem because we would have a guy come in two or three times, get to know his first name and then start and call him on his first name and he wouldn’t know what to do. The formality went out the window and it took some time for the customer to realise this is actually quite enjoyable to relax a bit and to have fun and laugh at things, because some of the English guys are pretty formal and they like to be called Mr and Sir etcetera, and we do it, but once you get to know a guy by his first name he becomes a mate and the next thing it’s changed a lot since.

Your energy levels are high, how do you keep them there, what do you do to make sure that you can arrive at work every day and from the top, all the staff and all the customers have a good time?

Yes, I think you’ve touched on something that I think about a lot. Our business is now going on 14 years and Browns was ten or 11 years old when I sold it and the Roxy Rhythm Bar was five years old and you kind of run out of ideas, how do you reinvent yourself all the time, but you just have to really think hard and think that the opposition is catching up, there are 150 restaurants within 500 metres of us. If you just sit down and not go forward, you will go backwards fast, so you are forced to show innovation and think on your feet and think of new projects or new elements that you can add to your business all the time and luckily if you really love your business it almost comes naturally.

Luckily I married a very intelligent person, who is my backing on this and we try and improve and further the business all the time and yes, at times you battle a little bit with energy, but I’ve been in it for 35 years, and overall it’s fantastic to just see what you can achieve and to think of new ways to achieve it and it’s fantastic if you see a new idea that works. We’ve had wine club events, we’ve just had a fine wine tasting where people paid 100 Pounds to taste five wines and it was a roaring success and just a new avenue that’s opened, so yes, very interesting.

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There seems to be new wine farms springing up all the time in South Africa, how do you get to decide on who you actually bring into this huge cellar that you have?

That’s actually more difficult than you think and it’s a continuous battle because we have been in this business now, since Joburg days from the nineties. We’ve worked with winemakers for 25 years in many cases and once you’re on the wine list and I’ve known you for 25 years it’s a little bit like being married to you, it’s a very difficult divorce and if you haven’t really p’d me off, there’s no reason why I should divorce you, so if you’re a good supplier of ours and you look after us, we look after you. It’s a marriage, so I mean Paul Cluver, Martin, Meinhardt, Ken Forrester, the Hamilton Russel’s, Kaapzicht, Vergelegen, and Andre van Rensburg, these people have been with us forever and they are family.

They come here and we know each other’s kids names and wives names etcetera, so the new guys have a difficult job to get a look in, so yes, now and then a product goes out of stock and you have to find a replacement and that’s sometimes how you get your foot in the door, but yes, the wine list, we try and renew it, but it’s difficult because the old wines are so popular, they are our backbone. They’ve been the mainstay of the business and of South African wine for a long time, it’s not easy. I forgot to mention Meerlust. Meerlust is one of our biggest partners and Chris Williams comes here all the time, Hannes Myburgh comes here all the time.

These are our friends and are kind of semi-family, so it’s difficult to get the new ones on but we keep a keen eye on it, we taste the wines and if it’s extraordinary, we need to find a place for it, but you know it’s difficult to dislodge the good old wines and they’re getting better as well, so you know, all in all, and your customers know their names and you don’t have to reintroduce and work hard. It’s difficult, but yes, we try and keep up.

It’s an extraordinarily difficult business though if you look at it from the outside. As you say, intense competition, the rents are very high; staff costs must be exorbitant as well. What is it that you do in a business that has those challenges that enables you to continue profitably year after year?

I think you’re probably looking at my hairstyle now and thinking yes, one can see you’ve had a few years in this business. It’s a tough business, it is a business that you have to commit to completely and spend a lot of hours in. It has its difficulties, as you say, but there is a big market out there, there is a wide range of things you can do to innovate and to bring new stuff too. There are many areas where you can be better than the next guy. I think we’ve taken our wine function to a different level and we do a few things, like the South African Wine Festival in May every year, whereby we get about 15 or 20 wine companies to come and expose their wines to our tastings here, where we get our customers in.

We have three days of continuous wine tastings and dinners, we bring those winemakers down to the dinner and they present their wines over dinner to bring our customers closer to the winemakers and closer to the product and get to know from the source what is going on and it’s fantastically valuable and successful. A great part of our business is just to bring the wine and the customer closer together. London is fuelled by wine. Gin is now trying to get a foot in the door, but wine is reigning supreme. Even beer battles at times with wine as the wine is very, very strong in the UK.

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Is South African wine holding its own?

Yes, as I said, the UK loves South Africa, per definition, South African wine and the value is good because the Rand is not very strong. I think I’m the last one to say that South African wine is the best in the world. The French have a thousand years head start on us, but we’re catching up and our value is fantastic. I mean, if you say to me, “Give me a bottle of wine for 50 Pounds” I can give you a much better South African wine than I can give you a French wine I believe, and if you prove that to a customer he’s yours, he’s coming back and he says, “Can I have the same wine again” and if you can remember what it was, he’s yours forever or for a long time.

Gerrie, what’s next? You have been here for some time now; your daughters as you shared with us are still in South Africa, are you going to be going back there one day?

That’s a bit of an open question, Alec, but it’s looking less and less likely that I’ll go back permanently. I have children and grandchildren over there. I’m unfortunately not a youngster anymore, but yes, we had expansion plans, a lot of them, big expansion plans, which were really nipped in the bud by the recession, because we had to survive first of all and we were lucky to survive. Many restaurants in this area did not survive and I’m very thankful for that. I had to borrow money for the first time in my life, which I didn’t like the feeling of. We got through it and things are going very well now, but I think the expansion plans are shelved for the time being because unfortunately, I may have missed that opportunity in terms of where I am in my career.

What about South Africa into the future, would you retire there or are you here now?

No, the dream would be to retire half the time there and half the time here.

Talking about the winter weather, you’d like to miss it.

I don’t know, like many South Africans, I suffer from skin problems from too much son, so I go sit on the beach in Cape St Francis, where we have a house and I sit under the umbrellas, so the sun doesn’t play a big role in my life, so I don’t mind the weather at all. I love the cold, I’m a keen skier, so yes, but I’d like to spend more time in South Africa, it’s still my country of birth, I love it, it’s wonderfully exciting, it throws new balls at you every minute that you’re there. It’s a bit worrisome on some fronts in terms of crime etcetera, but I’m sure some sanity will prevail and some people with level ideas will realise that the middle way will be the way to go and they’ll sort it. So yes, the ideal is to spend six months a year there and six months a year in the UK. I love the UK, I think the UK is an amazing beacon of liberalism and tolerance and I think that’s exactly what I like to live in.

From a broader perspective, looking back at your business career, you didn’t choose an easy route and this business that you’re in has its challenges. When you look back, what was the biggest challenge that you could warn those who are coming into the whole food and beverage sector about and what has been the most successful thing that you think you’ve done?

Well, I think the catering business has its drawbacks and its difficulties. It’s unbelievably time-consuming. My mother once said to me, just after I entered this business, she said, “Good heavens, your job is like mine, a housewife, it never stops”, and it is difficult, it has so many facets. For instance, the two restaurants that we run in London, we employ 60 employees, that in itself is a huge challenge, just to keep up with health and safety, with compliance, with keeping up with wage rates in London is very difficult, especially now when there is going to be a shortage if the immigration stuff changes, so we don’t know. Yes, that is difficult but it has one huge plus and that is the immediacy of it. If you are successful you see the success day after day after day. It’s not like an architect where you start a drawing and you see the result in five years in many cases.

A friend of mine said, “Yes, you get immediate feedback or food back” and that’s very true. It is a very rewarding business because a smooth running restaurant is a joy to behold. I often remember Browns on a Saturday night on the patio when Dan Hill and his quartet were playing, it was just absolute bliss. I was so proud standing there and thinking, we’re running this and Vivat Bacchus in the big City of London, I’m very proud of what we’re doing and I love it. People are good to you, they realise that you’re trying hard and you’re working pretty hard at it and the reward is fantastic in terms of satisfaction. It’s also financially rewarding, but the big price is time. If you’re a family person, often you sacrifice a lot and the challenge is to make sure that your staff is in the same situation, have a balanced life and can give enough time to their families as well, but it is a challenge, yes.

Any regrets?

Yes, I wish I had come to London earlier, I wish I had not encountered the economic recession, depression of 2009. I think we would have been maybe five or six or seven restaurants strong by now if it wasn’t for that, but you can’t change that, so it is what it is and we’re pretty happy now. It’s a smaller business than we envisaged, but it’s compact, it is pretty well-situated and we’re very happy.

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It’s not such a small business when you say, 60 staff. How many people could you seat at a lunch?

In London Bridge, we have 150 seats and at Farringdon, we have 300 seats all in all.

How would that compare with Browns?

Browns was a 250 seater, so yes this is not a small business. For a guy like me running it, it’s quite a big business, as it keeps you busy every moment of the day, but in terms of where it could have been, if we could have created five or six more branches, it could have been something different, but it wasn’t and maybe it’s not meant to be and that is what is.

You have to dream big, maybe five or six in the future.

I didn’t want to bring this up, but I’m turning 64 and my wife has sat me down and said, “You are going to work less and not more”. Yes, I’d love to do more branches and I’d love to hand over to people to run it for us and I’ll be in a chairman situation or a CEO and oversee meetings only, but it’s not easy to get the right staff in our business, it’s very difficult in London, it’s very competitive staff wise and there are some big players that are difficult to oppose, but let’s hope, who knows what can happen.

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