Loungers is a substantial and growing operator in the UK hospitality sector. As at April 2019, Loungers operates 146 sites in England and Wales across two distinct but complementary brands, Lounge and Cosy Club. Founded in 2002 by three friends who wanted to create a neighbourhood café-bar that they would want to go to, the Group is now the only growing all-day operator of scale in the UK and has consistently outperformed the wider UK hospitality sector over the past three years.
The Directors intend to continue to pursue an organic growth strategy, driven by the rollout of new Lounge and Cosy Club sites and an ongoing focus on operational improvements to drive further sales and margin improvements across the existing estate. This strategy is consistent with the strategy successfully executed by the Group over the past three years.
The Directors are targeting 25 new site openings per annum over the medium term, of which approximately 20 are expected to be Lounges and approximately five are expected to be Cosy Clubs.
A Lounge is a neighbourhood café/bar combining elements of a restaurant, British pub and coffee shop culture. As at April 2019, there are 122 Lounges nationwide. Lounges are principally located in secondary suburban high streets and small town centres. The sites are characterised by informal, unique interiors with an emphasis on a warm, comfortable atmosphere, often described as a “home from home”. The Lounge estate has a consistent look and feel but each Lounge is individually named and tailored to the site and local area, and the design of each Lounge is continually evolving, meaning no two sites are the same.
The Lounge brand aims to have hospitality and familiarity at its core, driven by an independent culture and focus on the local community. Each site has its own social media presence and staff are encouraged to engage with the local community through events, charity and community groups. 80 per cent. of customers live locally (Source: November 2018 survey of 1,529 customers undertaken by consultancy firm Market Measures), underlining each Lounge’s local neighbourhood credentials.
Lounges appeal to a diverse customer base, offering something for everyone regardless of age, demographic or gender.
A Lounge represents something different to different people. For some it is somewhere to go for a coffee after the school run; for others it is a place to catch up with friends; a place for an informal meal, a celebration or a night out. 90 per cent. of Lounge customers visit for multiple occasions, 25 per cent. of Lounge customers visit at least weekly and two thirds visit every month, which demonstrates the versatility of the Lounge offering and the loyalty of the customer base.
Every Lounge offers all-day dining, with the same menu served from 9.00 a.m. to 10.00 p.m., everyday. Sales are well diversified across all day parts and days of the week as well as across all food and drink types. In addition to helping to drive repeat custom and maximise the trading efficiency of the sites, the all-day offering involves managing operational complexity, particularly in the kitchens, which the Directors believe is a meaningful barrier to entry for other operators.
Cosy Clubs are more formal bars/restaurants offering reservations and table service but share many similarities with the Lounges in terms of their broad, all-day offering and their focus on hospitality and culture. Cosy Clubs are typically located in city centres and large market towns. Interiors tend to be larger and more theatrical than for a Lounge, and heritage buildings or first-floor spaces are often employed to create a sense of occasion. The Cosy Club brand enables the Group to operate in areas where there is a more occasion-led demographic and offers an opportunity for greater coverage within cities (Birmingham, for example, has nine Lounges and one Cosy Club within a ten-mile radius). Sales, EBITDA and capital expenditure are typically higher for a Cosy Club than for a Lounge. As at April 2019, there are currently 24 Cosy Clubs in England and Wales.
Cosy Clubs benefit from a similarly demographically diverse customer base as Lounges, appealing to all age groups and genders. Whilst during the daytime customers use Cosy Clubs much like they use Lounges (for instance, for coffee or a quick lunch), in the evenings they are used more formally for drinks and dinner and frequently host larger tables celebrating a special occasion.
- Casual Dining Awards: Large Employer of the Year 2018
- PETA Vegan Food Awards: Best Vegan Menu 2017
- Retailers’ Retailer of the Year Awards: Deal of the Year 2017
- Caterer.com: Best Employers in Hospitality 2015
- Peach Hero and Icon Award: Industry Leader 2015 (Alex Reilley)
- Sunday Times Fast Track 100: 2015
- Catey Awards: Pub and Bar Award 2014
- Retailers’ Retailer of the Year Awards: Winner 2014
- R200 Restaurant Operator of the Year: Winner 2013
- Peach Factory Hero & Icon Award: Breakthrough Brand 2012
- Insider South West Dealmakers: Deal of the Year 2012
- Retailers’ Retailer of the Year Awards: Rising Star 2012 (Alex Reilley)