Think About Where The Market Is Headed, Prepare For Tomorrow, And Move Fast
Express Food & Hospitality|February 2020
Chander Baljee, CMD, Royal Orchid & Regenta Hotels is a veteran hospitality thought leader and an expert on owned, leased, managed and franchised hotel models. His success story features in a book titled ‘Stay Hungry Stay Foolish’ which follows the professional journey of 25 IIM Ahmedabad entrepreneurs. In an exclusive interview with Steena Joy, he elucidates on the changing hospitality landscape, the demand for industry status and advises hoteliers to boldly venture into newer segments, try new niches and create new experiences.

You started Royal Orchid in 2001. How has the hospitality industry in India changed over the last two decades?

We have come a long way. The early years; 2001 to 2003 were years of struggle. The five years between 2003 and 2008 is actually when the economy boomed, only to realise there was a shortage of accommodation options. Investors at that time naturally turned bullish and desirous; everyone had a plan to operate 100 hotels. Growth, however, comes with its own challenges. The industry battled funding, investment and licensing issues. It was normal for the process to take 3-4 years before a hotel could open and many hotel projects got delayed because of this. In 2008 recession hit the market. The economy was in a limbo, and ironically, by now, there was an abundance of hotel inventory. The downturn continued for 10 years - it was the biggest slowdown we have seen.

Over the last few years, growth in technology, financial services and manufacturing sector has led to high demand for rooms and hotels have started doing well. A lot of new players have entered the market. So much of unorganised inventory is now available for booking and all of this has been enabled by technology. Look at the enormous and fast growth of Oyo, Fabhotels and Treebo. OTAs have been enablers of monumental growth. We see thousands of small hotels now being able to list themselves and get bookings online. People have started converting houses into guesthouses, which goes to show that the demand is healthy. Also, an increase in disposable income, new airports, better road and rail connectivity has led to an increase in demand for hotels.

As an industry, we have certainly benefitted from tech advancement. Our distribution and reservation systems are now on the cloud. We’re able to manage the entire customer lifecycle journey, thereby building an ecosystem where we know much more about our guests so we’re able to deliver personalised experiences. I remember the days when it was difficult to manage individual hotels, and we’re certainly much stronger today when it comes to revenue and operations management across our portfolio. We use multiple technology platforms that give us real-time analytics and insights into business on-ground, enabling us to create better value for our asset owners and investors in terms of occupancy, ARRs and GOP.

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