OYO CHECKS INTO 100,000 ROOMS
Hospitality start-up OYO, which began its journey with a single hotel in 2013, has become a sectoral giant with a network of over 100,000 rooms, the first such by an Indian firm. It is adding 10,000 rooms every month and expects to double the inventory to 200,000 by the end of 2018-19. This puts OYO ahead of other players. Marriott has around 23,000 rooms in the country, while Taj Hotels has 17,000. AJAY MODI writes
SoftBank-backed hospitality start-up OYO, which began its journey with a single hotel in 2013, has become a sectoral giant with a network of over 100,000 rooms, the first such by an Indian company.
It is adding 10,000 rooms every month and expects to double the inventory to 200,000 by the end of 2018-19. This puts OYO ahead of other players. Marriott has around 23,000 rooms in the country, while Taj Hotels has around 17,000. The segments OYO operate, though, are different. “This is a huge milestone for the hospitality sector in general. It demonstrates the Indian hospitality market has come of age. Earlier, there was a general view that Indian hospitality cannot scale up. You saw all the chains struggling to get assets and expand. This milestone reinforces the fact that demand for quality living spaces remains high and supply is the only constraint. If you create them, demand will follow,” said OYO Founder and Chief Executive Officer Ritesh Agarwal.
OYO operates at price points of up to ~3,000 per room per night. The company said it was seeing a company-level occupancy of 70 per cent for its 100,000 rooms, spread across more than 5,000 properties. The company started with the concept of budget rooms, under OYO Rooms. It moved to a simple distributor model, where it sold a part of the inventory of a hotel as OYO Rooms, while the hotel sold individually on online travel agencies. Finally, it shifted to an exclusive model where all rooms were OYO-branded. Its next major step was to foray into a premium offering under OYO Townhouse. It also has presence in homestays under the OYO Home brand. Its latest move is to get into apartments aimed at serving project-based stays of corporate travellers under the Silverkey brand.
OYO’s rapid expansion was wellplanned, but not without challenge.