Travelodge reveals ‘radical’ new budget-luxe design

A “radical” new budget-luxe design is being introduced by Travelodge following a strategy review by the budget chain.

A number of sustainable initiatives includes carpet being made from recycled fishing nets, with the carpet backing from old plastic bottles.

Other features include low energy lighting, motion sensing controls and aerated showers and taps

The scheme is being kick-started with a multi-million pound investment to upgrade 60 hotels this year in popular UK business and holiday destinations.  

The remodelling of the core hotel offering follows a poll of 5,000 business and leisure which found that they crave style, choice and homely touches to make it easier to work, rest and relax both inside and outside the room.  

The new design has been created on the success of the TravelodgePLUS ‘budget chic’ hotel format.

The overhaul was unveiled as the company reported a return to the black last year with a profit of £81.1 million against a loss of £74 million during pandemic-hit 2020, however the result was down on the £129.1 million achieved in pre-Covid 2019.

Travelodge reported an improvement in current trading following the lifting of the work from home guidance on January 26, with strong leisure trading expected to continue, driven by demand for domestic breaks.

The Midscale and Economy (MSE) segment continues to recover ahead of the UK market, and is now better than 2019 levels, according to the firm which has almost 600 properties.

The company admitted that forecasting “remains a challenge” with the pace of recovery expected to depend on several factors including the continued effectiveness of vaccines, consumer and business behaviour and more broadly the general economic and political environment.  

“We expect 2022 to benefit from sustained ‘blue-collar’ business demand, and strong leisure demand, offsetting a more gradual recovery in ‘white collar’ corporate demand,” Travelodge said.

“We do, however, face a number of cost headwinds, including the significant inflationary pressures facing the wider UK economy.”

These include a 6.6% increase in the National Living Wage from April 1 and a 1.25% increase in employer National Insurance contributions.

“Operating costs, including rent, will also be impacted by general inflationary increases, as well as energy prices (although the majority of our forecast 2022 energy volumes are hedged) and some specific supplier price increases,” the company added.

“The situation in Ukraine may increase the impact of these cost pressures in the short-term and will depend on the duration of the crisis. The overwhelming majority of Travelodge’s customers are domestic, so the business has little exposure in terms of demand.”  

Six new UK leased hotels and one Irish franchise are set to open this year.

“Whilst the macro-economic environment remains uncertain, the budget hotel segment has proven resilience and continues to recover ahead of the rest of the UK hotel market,” Travelodge said.

“With our large diversified network of hotels, strong brand, direct distribution model, value proposition, customer mix and domestic travel focus, Travelodge is well positioned to benefit from any recovery as demand builds and we are confident in the long-term prospects for budget hotels.”

Chairman Martin Robinson added:  “Travelodge reinforced its position as a resilient business with a powerful brand throughout a challenging 2021.

“The business continued to out-perform the market for the seventh year in a row and enjoyed a record-breaking summer and in line with our growth plans, we opened a further 17 new hotels. 

“Trading so far in 2022 has been extremely encouraging, despite a slow start amidst the Omicron restrictions in January, and we are excited to launch our new budget-luxe hotel design, which offers a more premium look and feel whilst maintaining our great value price proposition.

“This is our most radical brand transformation to date and has been created in response to Britain becoming a nation of budget travellers, with more of us choosing to stay in budget hotels. 

“The budget hotel segment, whilst not immune from the broader economic uncertainty, has proven resilient and continues to recover ahead of the rest of the UK hotel market; and we believe that the opportunities to grow our business have never been more exciting.

“With our large, diversified network of hotels, strong brand, value proposition, and focus on domestic budget travel, we are well positioned to benefit in the anticipated recovery.”


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