Hotelier India|June 2020

As experts predict a resurgence in domestic leisure and road travel, the neglected independent boutique hotel segment closer to the metro cities, with a lesser number of keys, experiential offerings and the ability to allow for social distancing, will benefit

The jury is out on this one and the verdict is unanimous: The leisure segment and road trips will be the first to bounce back. Ergo, hotels, resorts and retreats that cater to this market, particularly the smaller boutique hotels with fewer suites and an inbuilt ability to allow social distancing, will revive rather quickly.

Shoba Mohan, Founder-Partner, RARE says, “Since owners lead these hotels, the SoPs are already in place. Besides, they have a generous land-to-key ratio, as much as five rooms to 12 acres. Creating al fresco dining is easy, and the staff is small and controllable.” Travellers looking for handcrafted offbeat experiences will help shore up independent hotels.

Akanksha Lamba, Senior Vice President – Operations, The Postcard Hotels & Resorts, says, “About 26 million Indians usually travel outside India every year. At present, they do not have the option of international travel and will begin looking for holiday destinations within India. On a holiday to Europe or the US, a couple will spend at least Rs 10 lakhs. In A holiday in India is less expensive.”

Luxury boutique hotels such as The Postcard Hotels & Resorts or Malabar Escapes are naturally created keeping privacy in mind. “With their non-obtrusive service, they will find it easier to restart when travel restrictions are lifted, beginning with guests who can reach by road, then interstate and finally, international travellers,” says Saji Joseph, CEO, Malabar Escapes, a member of the RARE network. Indians make 1.8 billion trips per year within the country. Capturing even 1% of this will mean 18 million travellers.

The higher end of the market is not as impacted by the economic contraction. “People would prefer hotels that have a unique experience to offer, assure top-level of hygiene, and are well-connected by roads,” says Roop Pratap Choudhary, Managing Director, Noor Mahal, Karnal, at a short drive from Delhi NCR, and major cities of Punjab and Haryana.

Destinations that will see footfalls

Devendra Parulekar, Founder, SaffronStays, says, “People will want to take their cars out and drive to something closer home. Most of our homes, which are within two to three hours driving distance from the city, are perfectly poised.”

SaffronStays has hit upon an innovative idea of offering homes for long-term rentals. “Several people may want to escape the traps of their daily household chores and want somebody else to pamper them. In that case they may want to hire a villa for a month at Alibaug and operate out of it.”

Destinations such as Goa and the hill getaways are more likely to find guests driving up for a stay. Lamba adds, “Our hotels in Thimphu and Galle have the advantage of being in COVID-free destinations. Our biggest weakness is that we only have five operational hotels instead of 15. We would have liked to offer people four to five destinations around Delhi. We will be able to do so soon with our upcoming hotels in Amritsar and Mashobra.”

Boutique hotels are also far more nimble-footed and offer quick decision-making and implementation. Manu Rishi Guptha, CEO, Niraamaya Retreats says, “They can change strategy and business model almost immediately. They also have a better grip on the expenses. Boutique hotels like ours can weave a narrative that is hotel and destination specific.”

Manvendra Singh Shekhawat, Managing Director, MRS Group (with hotels such as Suryagarh in Jaisalmer, and Narendra Bhawan as well as Laxmi Niwas Palace in Bikaner), expects people from Ahmedabad, Jodhpur, Jaipur, and adventure seekers looking to travel from Mandwa to Jaisalmer to drive in. “As airline connectivity starts picking up to smaller destinations, many will travel for staycations. We have received a request for booking a 45-day-long staycation once the hotel opens up. We thought Jaisalmer would bounce back first. But surprisingly, Bikaner opened first since flights have begun to the destination.”

Malabar Escapes, which has the Malabar House, Trinity Fort Cochin and Purity at Lake Vembanad, will open the latter first, due to its added advantage of Discovery, their exclusive one-bedroom suite house boat.

The challenges

While the advantage is that luxury boutique hotels fit all the boxes for offering confidence in a post-COVID world on counts of safety, hygiene and social distancing, Joseph says the scale of economics of running the small properties with very dismal occupancy will be tough.

For hotels in Kerala, it is more than a double whammy. “After 9/11, the tsunami, then the floods, there is always still one up. We have learnt lessons: Trim the company to the best possible productivity and build your team around an essential core. A multitude of possible crisis situations are possibly around the next bend. But after every sunset, there is a sunrise,” Joseph says hoping for better days.

One of the disadvantages that small chains encounter is the reasonably high marketing costs. “Our associates and senior managers are as qualified as the ones in large hotels. So, manpower costs have to be spread over much smaller sizes of inventory as compared to large hotels. However, the pros far outweigh the cons as we can drive top-notch quality and service standards that are benchmarked against the finest brands in the industry,” contends Guptha.

Here is how independent hoteliers are keeping their heads up and riding the storm.

Cost rationalisation


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June 2020