Premier Inn is undergoing significant restructuring as it embarks on a £500 million expansion plan, aiming to add 3,500 rooms through restaurant conversions.
- The hotel chain will transform 112 of its restaurants into rooms, contributing to its ambitious expansion target.
- As part of this transition, 126 underperforming restaurants will be sold, impacting 1,500 jobs in the UK.
- Despite challenges, Premier Inn’s financial performance remains strong, reporting a 36% rise in pre-tax profit for the 2023-24 financial year.
- The chain is broadening its appeal to business travellers, increasing channels through Travel Management Companies.
Premier Inn is embarking on a bold £500 million expansion strategy, reshaping its approach to hospitality by converting 112 restaurants into hotel rooms. This move is part of a broader plan to add 3,500 rooms to its UK capacity, ultimately enhancing its service offering to guests.
However, this transition is not without its repercussions. A total of 126 ‘lower-performing’ restaurants are set to be sold, impacting approximately 1,500 jobs across the country. This decision comes amidst Premier Inn’s ambitious growth strategy and the company’s commitment to reallocate roles through existing recruitment processes, which yield around 15,000 hires annually.
Notably, Premier Inn’s financial performance remains robust. The UK’s largest hotel group recorded a 36% increase in pre-tax profit, totalling £561 million for the 2023-24 financial year. Accommodation sales experienced a 12% year-on-year increase, despite minor setbacks due to public holiday scheduling.
The hotel chain is focusing on attracting business travellers, who constitute a growing segment of its clientele. Approximately 20% of Premier Inn’s accommodation sales are now generated through business-focused channels, including a dedicated booking portal and Travel Management Companies (TMCs), up from 17% the previous year.
Dominic Paul, CEO of Whitbread, which owns Premier Inn, expressed optimism about the changes. ‘Our increased levels of profitability, operating cash flow, and return on capital reflect the power of our unique operating model,’ he stated, signalling confidence in the company’s strategic direction.
Premier Inn’s strategic realignment underscores its commitment to growth and adaptability in the evolving hospitality landscape.
