21 comes of age

Eighteen months ago, following a "for sale" advertisement in Caterer & Hotelkeeper, rumours were rife that Newcastle's only Michelin-starred restaurant, 21 Queen Street, had hit the buffers. Speculation merely increased when, six months later, the advertisements ran no more. The talk, then, was that chef-proprietor Terry Laybourne was going to turn Newcastle's most prestigious fine dining restaurant into a café.

As with most gossip, the truth was somewhat wide of the mark but not completely unfounded, for in August last year Laybourne closed 21 Queen Street and converted the site into a bistro. Nor is he reluctant to discuss what brought about the transformation of his flagship restaurant into the mid-spend Café 21.

His explanation is as uncomplicated as his style has always been - the restaurant was in a straitjacket. "When we opened 12 years ago," Laybourne says, "the city council promised regeneration of the Tyne waterfront. It's happened, but it took 10 years. The whole area is buzzing now, but it's been a nightmare for the past year with building work. The dust was everywhere and parking was impossible.

"Masses of bars and restaurants have opened around here, but they're for a young market. The waterfront is jumping at one in the morning," continues Laybourne. "The kind of customers who were coming to 21 Queen Street when we first opened got nervous about parking their cars at night and walking through the street at the weekend when it was all going on." Quickly he adds: "I'm not knocking Newcastle - it's brilliant, but this isn't the right location any more for what we were doing. The restaurant is too small and we can't make it any bigger. Financially, the restaurant was wiping its face, but I couldn't see a way forward."

The rollout of Café 21 bistros had been a business plan for Laybourne since the early 1990s, but he was always reluctant to tinker with the restaurant which made him both a regional and national celebrity chef. With no hope of expanding the site, Laybourne turned to the possibility of selling up, and asked Christie & Co for a valuation. "The company looked at the books and said £350,000," he recalls. "When somebody talks about that sort of money, you have to have a go."

He left it on the open market for the minimum six months and, while there were a few interested parties, there were no serious bids. So Laybourne decided to grasp the nettle and relinquish the restaurant's proudly held Michelin star, an accolade it had held for almost 10 years. "I did it properly," he says. "I wrote to Michelin, telling them what I was going to do, and thanking them for their support over the years - but there was no point in trying to hide what was happening."

Laybourne (left) is adamant that he is as committed to fine dining as ever, but his Café 21 bistros, which with the conversion of 21 Queen Street now number four, have grown into a North-east mini-chain which is doing very good business in the informal dining market.

The Café 21 concept began in 1994 when, on an impulse, he put in a chance bid for a struggling 32-seat Italian restaurant in the affluent Ponteland district of north Newcastle - and the offer was accepted. Despite his acumen in running restaurants, Laybourne admits now that it didn't make sense to expect to make money from a 32-seat neighbourhood restaurant, but part of the drive behind opening a second restaurant was to provide staff at 21 Queen Street with the opportunity for career progression within a group.

With typical flair, he turned the 32-seat restaurant into a profitable business not just by offering modern bistro food, but by refusing to take bookings. This persuaded customers to come earlier to ensure that they got a table, which in turn meant that they left earlier, allowing the table-turning which made the profit. Two years later, when premises next door became vacant, Laybourne jumped at the opportunity to buy them, doubling the size of the Ponteland restaurant and driving profits even higher.

There was also some very tight food cost control and food waste management. Laybourne beams as he recounts how he was evangelical about using every part of every bit of food which came into the kitchen. "I'd look in the larder and fridges to see what was left and what we could make from it," he says. "We made fish cakes from the trimmings off salmon, soups from meat bones, and game terrines from venison trimmings."

The opportunity to do this comes from a practice Laybourne initiated at 21 Queen Street - the insistence on buying produce as it lands on the wholesale market, with any butchery, fish filleting and greengrocery preparation being done by his chefs. This, says Laybourne, is giving his brigade proper craft training as well as providing free trimmings. "Chefs still need to learn their job properly," he says. "I had a chef working in the veg corner last year, chopping cabbage by hand for three days so he learned how to do it properly and get the right yield. Then, on the fourth day, I let him use the Robot Coupe because he understood what the machine had to do."

After his success in north Newcastle with the first Café 21, Laybourne went 15 miles south, opening a second, 90-seat bistro in a converted Durham farmhouse. While the style of food was recognisably Café 21, the building and atmosphere were completely different. This was deliberate - Laybourne says that he wants customers to know what standards of food and service to expect of a Café 21, but he doesn't want to clone every outlet, visually or on the menu. This way, he hopes, customers will be tempted to visit more than one café knowing that they will always be surprised.

When the third Café 21 opened in Sunderland in 1998, the first doubts about the future of his Michelin restaurant set in. Laybourne became conscious that there was market confusion between 21 Queen Street and the Café 21 outlets. "People were going into a Café 21 and expecting the same kind of service and food as 21 Queen Street," he says. "I suppose some came here expecting to pay Café 21 prices.

"I knew I'd created a brand with Café, and I've never forgotten what Albert Roux once said - ‘A restaurant has a life of seven years.' 21 Queen Street lived for 12 years - it was time for a change. A restaurant is like something you want for the kitchen - you kill it while it's still alive, you don't wait until it dies."

Laybourne knew that changing 21 Queen Street into Café 21 was a financial gamble. Prices had to drop, with little change in the number of tables, so he had to drive up customer numbers. In its existing format, 21 Queen Street was averaging 350 customers a week at £48.50 a head (making £17,000 a week), but most of that came from dinner business and people kept a table for the whole night. Since the conversion in early December, average spend has dropped to £30.30.

So, just to stand still on revenues, the new format needed to drive customer numbers up to 560 a week - a jump of more than 60%. It worked - while December was bound to be a good month for a new restaurant in a city centre, January is also proving strong. Moreover, lunchtime trade has been revived.

Winning formula

But though he has established a winning formula with the bistros, Laybourne is doubtful about further expansion. When any brand expands, he warns, quality control can easily slip. There may be scope for one or maybe two more Café 21 sites, but they will stay in the area, where the twin brands of Laybourne and 21 are firmly established.

So has Laybourne swapped whites for pinstripes? "I still love cooking as much as I ever did," he says. "I've got to be in the kitchen every day. That's what it's all about for me." Has he an eye on eventually re-establishing a Michelin-standard restaurant? "There's always going to be a need for food and service of a very high standard," he responds. "I might go back to that one day, but not like 21 Queen Street. More like a French auberge - accommodation, really good food, but in a casual atmosphere. That's a bit of a romantic thing, isn't it? But it might happen."

A sample from the menu at Café 21, Queen Street

Lemon risotto with grilled prawns, £6.50

Spanish black pudding, haricots, crushed potato and Madeira sauce, £5.50

Rare salmon spring rolls with lime and ginger dip, £5.50

Confit of duck, lentil salad with endive, Roquefort and beetroot, £12.50

Braised pork shoulder, black pudding mash, braised cabbage, marjoram gravy, £12.50

Roast cod, braised fennel, saffron mash, slow-roast tomatoes and bouillabaisse sauce, £12

Steamed lemon pudding with lemon curd ice-cream, £4.50

Coconut panna cotta with exotic fruits, £5

Iced apple cheesecake with crumble topping, vanilla and cinnamon syrup, £4.50

Source: Caterer & Hotelkeeper magazine, 18-24 January 2001