“RedCat is a bit like a large collection of adopted children,” says Richard Lewis, who took on the chief executive role 18 months ago. “There’s lots of different businesses coming from different backgrounds with different formats from carveries to hotels.”
At the time, he admits, the business, which included a wide range of individual pubs and the Coaching Inn Group, was in need of “some turnaround”.
“It had some structural issues in terms of some loss making sites and we needed to create a slightly more coherent estate than we’d got, so it was a case of what do we want to keep and what do we want to lose.”
At the same time, he was having to manage the transition in leadership within the Coaching Inn Group as founder Kevin Charity was stepping down.
He points to the success of that group at the heart of RedCat Hospitality, the over-arching company that includes RedCat Independent Pubs and Coaching Inn Group, which has seen huge expansion from 18 sites to 35.
“[Some] 18 months ago we had to manage the transition of Kevin leaving, how do you make sure what’s potentially the main growth engine doesn’t stall under new leadership.”
Capital expenditure
Overcoming those problems and a subsequent refinancing has now given the business “longer-term security and more clarity for the future”.
That funding has allowed the firm to focus on investing into both estates within the company with around eight “medium” capex spends in the RedCat business, around the £100,000 to £200,000 mark, and more “bigger projects” to come.
Within Coaching Inn Group, he said there had been some “tactical spends” on refreshing bedrooms, alongside a major £3m investment into The Castle in Brecon which will open in April with 43 rooms and a 100 cover restaurant.
“The last financial year has been really, a year of transitional turnaround - RedCat has been about turnaround while Coaching Inn Group has been about transitioning management.”
Internal changes have also taken place he says: “We’ve also changed quite a bit of the team. I have to say I’m blessed with an amazing exec team. Rather than run the businesses independently we’ve brought together one exec team and have two chief operating officers running RedCat and Coaching Inn.
“The purpose of that was to one, be a little bit more efficient, and secondly bring together the synergies of both businesses.”
He said the structure now fits with the company’s aspirations to have a great people culture alongside industry leading standards. “A lot of that already exists within Coaching Inn Group, and we’re trying to use that best practice and develop that within RedCat.”
Company strategy
The strategy now is to invest and grow: “There’s lots of opportunities within the current estates, cap ex opportunities as well as investment opportunities, and we’re back on the acquisition trail.”
Although he stressed the acquisition approach would be much more scientific than previously: “Nothing is off the table, we’ll look at anything to see if its the right fit for us, but I would say at the moment it’s much more targeted and the priority is finding Coaching Inn sites that will be coherent to the business.”
Within the RedCat Independent Pubs side he said the focus was more on investment than acquisition but adds: “If the right thing came along for RedCat, it doesn’t mean we would not consider it.”
They’ll also be looking to drive innovation within the business, and one area they are going to be looking at is innovating around carvery operations, with investment and a potential to operate under a brand name, although at the moment he’s keeping his cards close to his chest on that development.
And of course, the business isn’t immune to the challenges the sector is facing: “We’re facing some pretty significant cost headwinds yet again. It’s a headache we could all do without and we could have done with a little bit more time to have been prepared for it.”
But he said success would be down to hard work and continual improvement: “You’ve got to create your own luck to be honest, these are not problems that are unique to us, every other business is having to navigate it but you’ve got to create your own luck.”
