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Mon 7th Nov 2022 - Loungers aims to reinvigorate roadside dining with launch of new concept Brightside
Loungers aims to reinvigorate roadside dining with launch of new concept Brightside: Café bar operator Loungers plans to “reinvigorate roadside dining in the UK” with the launch of a new concept called Brightside. The operator of the Lounge and Cosy Club brands will launch the new concept in February after securing an initial three roadside sites in the south west. The Nick Collins-led group said it sees great potential to reinvigorate roadside dining in the UK, a sector that it believes has become “tired and uninspiring”. Propel understands that the company has acquired three sites from the Route Restaurant Group, which operates the Route 5, Route 38 and Route 303 roadside locations. The company’s fourth site, Route 39 in Wadebridge, was not part of the deal. The first Brightside is set to open on the A38, south of Exeter, in February 2023. Further sites will open on the A38 near Saltash, and on the A303 near Honiton, in the spring. Propel understands that Sarah Hills – who was previously managing director of Bill’s, Wagamama, and most recently Megan’s – is heading up and overseeing the opening of the first three sites under the new concept, which will sit alongside Loungers’ existing brands, Lounge and Cosy Club. Openings of the initial Brightside locations will fall within the circa 30 new sites per year targeted by the business. Loungers said it believes there is scope to develop a “truly national brand” and has ambitious plans to roll out Brightside to all corners of the UK in the coming years. It is envisaged that sites will be situated predominantly on A-roads and will focus on bringing “genuine hospitality back to a sector that has been dominated by drive-thru and QSR (quick service restaurant) concepts in recent years”. The company said: “Brightside will offer a freshly cooked menu full of classic, comfort food-style dishes – including an extensive brunch menu, burgers, pizzas, and kids’ menu – in nostalgic surroundings. The roadside restaurants will appeal to a broad range of customers including families, locals, and UK holidaymakers. Brightside will share the same core DNA of the Lounge and Cosy Club brands – a focus on all-day dining to appeal to a broad audience, a fierce commitment to value for money, and run by teams that deliver exceptional service. Brightside roadside restaurants will be friendly, warm and wholesome, and will endeavour to bring back the pleasure of heading out and exploring.” Alex Reilley, founder chairman of Loungers, said: “We’ve had the itch for a while now to create a roadside restaurant concept that’s fit-for-purpose in the 21st century. For many people, the highlight of childhood road trips in days gone by was a stop at the likes of Little Chef. We believe there is a gap in the market for a fresh concept that gives customers the option to take a proper break and enjoy wholesome food and great hospitality, in a landscape that is currently dominated by drive-thru and QSR formats. Brightside will have a contemporary, welcoming and warm feel, while also evoking nostalgia for a time when motoring in the UK was a more exciting experience. We want it to be an integral part of our customers’ journey-planning, and something both adults and children alike look forward to. We believe that Brightside will really shake up what has become an uninspiring sector, and that there is potential to roll out Brightside across the UK in the coming years. Our expertise in high-quality, great value all-day dining, developed through Lounge and Cosy Club, gives us confidence that Brightside can bring proper hospitality back to roadside dining across the UK.” Loungers currently operates 210 sites – 175 under its Lounge concept and 35 Cosy Clubs. It opened three sites last week, including a Cosy Club in Milton Keynes and the Barco Lounge in Selby, North Yorkshire. Alex Reilley will be speaking at Propel’s latest Multi Club event this Thursday (10 November) at the Millennium Gloucester Hotel, London Kensington. Operators of multi-site companies can claim two free places by emailing jo.charity@propelinfo.com.

Comment piece by Propel group editor Mark Wingett

Anyone who follows Alex Reilley on Twitter knows how many miles up and down the UK’s road network the Loungers co-founder puts into assessing future sites for his business. Indeed, I recall writing a diary piece a few years back in which on one said trip, Reilley started in Bristol and finished in Birmingham, but took in Lancaster, Skipton, Ilkley, Northallerton and Ripon along the way – which to my reckoning is around 480 miles covered and more than nine hours of driving. Not only does it highlight the effort the business, and Reilley himself, puts in finding the right sites, but also that its chairman has probably built up quite a knowledge bank and opinion on the state of food and beverage at roadside services. As he admits, the creation of Brightside is an itch he has wanted to scratch for a while. That he mentions Little Chef is telling in showing the size of the prize available to Brightside, but also the pitfalls. For a business that has constantly been asked about the possibility of operating a third brand, and until now has always said it would stick to what was already very successful, this is a gamble – but one it takes from a position of strength and in a market that is still maturing, and lacks a branded alternative to the plethora of QSR and coffee brands currently dominating the market.

Reilley himself is aware of how it may look, especially those Little Chef comparisons. The iconic roadside cafe chain was arguably as integral to Britain’s road network as the AA or queuing on the M25. At one point the brand, which was founded in 1958, operated 439 sites across the UK, until years of under investment and mismanagement saw it cease to exist some 60 years later. Reilley tells me: “Obviously, lots of people may look at this and think the demise of Little Chef was down to a lack of people wanting to continue to use them. And that is undeniably true, but I think our view on this is that that was regrettably a sign of the fact that Little Chef didn’t evolve or innovate, and it was a business which seemed to suffer from a succession of owners that didn't really invest properly in the estate or the brand. It failed for a number of reasons that weren’t necessarily linked to behavioural change. The current consensus is that everyone is driven by convenience, and that motorists are obsessed about getting from A to B as quickly as possible, therefore QSR and drive thru concepts are absolute king. Clearly, we’re making a bit of a bet that we don’t necessarily buy into that. I think there’s sufficient evidence in comparable areas of the sector where I would take a degree of comfort in that this is a relatively safe bet. If you think about the Lounge concept, when we first opened our first few sites, we were told that opening in secondary high streets and suburbia made no sense as no one operates in these areas.

“Clearly, we’ve carved quite a successful business out of that initial belief that just because there’s nothing else there currently, doesn’t mean that what we offer wouldn’t work. If you consider what’s happening in airports and train stations, we’ve seen the quality of offering in other transport hubs massively improve, whereas what’s available on the roadside has, at best, stood still. And if I think back to when Westfield first came to the UK, and they put restaurants in their first UK shopping centre, and everybody said why the hell would you open restaurants in a shopping centre? At the time, people went to shopping centres to shop, and the only offer that you could generally find if you were hungry was those dreadful food courts, very much QSR, communal dining, not unlike most motorway service stations. Now you wouldn’t imagine a shopping centre without lots of restaurants. And our belief is that first and foremost, given that people that use restaurants and all forms of good quality hospitality in city centres, towns, airports, shopping centres, are the same people that drive along the roads of the UK network, we think that there is a significant opportunity to create something that people will start to use as part of their planned journey. Clearly, with what is going to only be an increasing requirement for people to stop because they need to charge their cars, I think we will see people want to, and need to, take more time out from driving.”

Brightside is launching into a very competitive arena, with an aggressive land grab for drive thru QSR and coffee shop offers currently going on. Indeed, many of those ex-Little Chefs are now either occupied by Starbucks or fast-food brands. For Loungers, providing a point of difference to that will be key. Reilley says: “We are basically, along with the likes of Mollie’s (the Soho House designed motel/diner concept) and someone like Gloucester Services, saying we think there clearly is very much a demand for QSR and drive-thrus but there is also an opportunity for different forms of hospitality.” It also allows the business to extend its reach and play to one of its strengths, tapping into local communities near to the stops. Reilley continues: “Chatting to the Route Restaurant guys, who are obviously very much masters of their craft in terms of understanding roadside dining and the ebbs and flows of operating on the side of a road, it’s encouraging how many locals will use their nearest Route Restaurant. If you take the Route 303 site, which is near Honiton and not that far from Chard, a surprising percentage of their existing trade is local. There appears to be the opportunity to feed off places that don’t really have much in the way of an F&B offer outside of what you might expect in a small town.

“It’s interesting, because we’re unlikely to ever open a Lounge in Chard or in Saltash where Route 38 is, but there’s a population there which we can hopefully tap into. As a consequence, we see this as giving us infill opportunities where, in addition to serving the motorists using the road, we can serve a local population. And if we happen to be positioned on the outskirts of a town where we think there’s probably not quite enough of a population or not necessarily much of a high street to warrant us going in and opening a Lounge in the centre, then the opportunities become very interesting. So, although what we’re doing is a very much a different expression of what we’ve done historically, there is a strategic advantage to it, because I think we can extend our reach even further in the UK in terms of potential number of sites. There’s also the benefit of operating in a transient environment, where you can pick up customers that will be coming from all sorts of places where, through Lounge and Cosy Club, the business might already exist, but they’re in a travel mode.”

In terms of the size of the prize, Reilley admits that the business hasn’t yet done a piece of work in terms of researching how many potential opportunities there are, and therefore “I couldn't put a number to that”. It is thought that the Little Chef number (439) is being used as a yardstick, but with the fact that that brand overstretched and cannibalised its estate in mind. Reilley says: “We’re not talking in the tens here, clearly, we’re talking in three figures. I think we see the opportunity as being very, very sizable. I think there are more Brightside opportunities than there are Cosy Club, for example. In terms of the whole Loungers business, operating in an environment where the size of the prize is still large, it’s just got a lot bigger.” Opportunities for growth will be single sites and, like the initial one, small groups. New builds are also on the agenda. Reilley adds: “We’ve had conversations with lots of the petrol forecourt providers, and I think we’ve got some traction with one of them where they’ve got redundant land which they can build on, and they can effectively rentalise their investment and make a good yield. They also recognise the benefit of having an operator like us alongside them because clearly, it’s likely to drive more traffic flow to their petrol forecourts, to their EV charging and to their shop.”

Even for a company as well established as Loungers, Reilley admits it has been quite tricky getting any kind of traction with forecourt owners because “we’re talking hypothetically about something which we haven’t opened yet, and when a lot of these conversations were happening, we didn't even have a name”. Ah yes, the name. Credited to Reilley’s fellow Loungers co-founder Jake Bishop, it is a one that needs to, first and foremost, “pass the kids in the backseat test”. Reilley says: “So, it had to be, ‘look mum and dad there’s a Brightside’. It had to be a word that kids could relate to very easily, that didn’t have any pronunciation difficulties, and had a happy, sunny disposition about it.” A sense of nostalgia will also be reflected in the concept’s design. Reilley continues: “From a design perspective, we hope to evoke a sort of sepia-toned memory of journeys past, but expressed in a very modern, contemporary, 21st century way. There needs to be a sense of there being something which encourages people to stop and feel really good about stopping because they have a really enjoyable, positive experience not just from the point of view of us delivering great hospitality and good food and drink, but that they’re actually in an environment which makes them happy and makes them smile.

“From a design perspective we’re having to think very differently to what we do with Lounge and Cosy Club. With the design process for both of those brands, there’s an element of us not quite starting a with a blank sheet of paper every time, but we’re looking at how we express what we do differently – are there opportunities for the look and feel to reflect the building, to reflect the history of the town or location? Through design, a Lounge hides in plain sight, and people don’t necessarily appreciate or realise the scale of the business, but what we have to do with Brightside is very different. We have to create a really, really recognisable brand. This is all about creating something very familiar and which delivers an impact, as people are travelling at speed and they realise that there’s something there that they recognise. This has been a really interesting challenge for us. It’s going to be fascinating to see how well we execute it, because I suspect it is going to be pretty good.”

You sense Reilley and Collins were keen to make sure the creative and competitive juices are still flowing at Loungers. As Reilley points out: “The energy that the business has as a consequence of doing something in addition to what we already do is undeniable. It benefits the other brands, because there is an outpouring of creativity and that filters through to everything that we do. We saw the distinct benefit we enjoyed when we launched Cosy Club as a second brand, and Brightside is having a similar impact in how it positively affects everyone and really dials up the entrepreneurial spirit within the business.” They will be aware of the issues that dragged Little Chef down, but also that when that business actually made the right investment, there was a market to be tapped into. A revamped menu and design overseen by chef Heston Blumenthal in 2009 as part of a Channel 4 programme led to food sales across the business increasing by 47% in 2011.

Unfortunately, it was too little, too late, as it couldn’t compete against the emerging fast-food model. Loungers will hope Brightside is better equipped to provide the alternative offering Reilley believes people will gravitate to, especially as the staycation trend continues and EV charging becomes more prevalent. Reilley says: “Clearly there will be a lot of people that will still want QSR, but what we are saying is we’re here to offer an alternative and that we are going to be doing something very different. There was a lot of debate around whether we should future proof and ensure we have room for a drive-thru lane, and whether we should offer takeout. But we concluded that wasn’t right because we want to offer roadside dining, and the guys that do drive-thru and takeout do it very successfully, and we’re happy to let them do what they do. This is what we do. And fundamentally, we believe that there are more than sufficient numbers of people who will embrace this with enthusiasm and almost be grateful that they have something that’s a genuine alternative.”

As Reilley says, this is an itch he has wanted the business to scratch for a long time, and you sense he is personally driving (excuse the pun) this move. The business is taking a gamble, but as he is aware, the prize if they get it right is significant. You can also expect other operators to see if it is one they can follow. He says: “It was fascinating when we gathered the wider senior team together to tell them what we were doing. I think we had 35 people in the room, and Nick asked, ‘I'm sure you will remember Little Chef, is there anybody here who’s never been to a Little Chef?’ Not a single hand went up. Little Chef had 439 restaurants at its peak, and while we’re not saying that we think we can replicate that as a number, we feel there’s a lot of opportunity in terms of what others have shown is achievable before us. I want this to remind me of how I felt as a kid, when we used to stop at a Little Chef, and that sense of excitement and that sense of nostalgia. I have the same feeling and motivation about why we opened our first Lounge, we wanted to open somewhere where we wanted to go ourselves. I want to go to a Brightside. I want to take my family there. I want people to reconnect with what is actually a really joyous experience, because dining by the side of a road is a very unique experience, and it’s something we’ve lost.” Strap in, this could be a very interesting ride.

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