Foreign brands withdraw frequently and local hotels are busy taking orders



With the gradual recovery of domestic tourism market, local hotel groups are also emerging. On April 12, a reporter from Beijing Business Daily found that Wanyi hotel in Beijing, formerly affiliated to Marriott International Group, had changed its brand to Jinling Hotel in Beijing after withdrawing its brand.

The Beijing Business Daily reporter also found that in recent years, the cases of changing the brand of domestic hotels after the withdrawal of foreign hotels have occurred repeatedly. Previously, the news of “reshuffle” of old foreign hotels such as Shanghai Jing’an Hilton and Shanghai Hongqiao Sheraton also came out one after another. Industry insiders pointed out that with the change of domestic high-end hotel market structure, it is expected that more foreign hotels will be delisted or replaced by local hotel brands in the future, and the local hotel team will continue to grow.


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Local brands

Last year’s epidemic has put unprecedented pressure on the hotel industry, and hotel operators are also undergoing a huge test. With the improvement of domestic epidemic prevention and control, local hotel brands seem to be emerging. Beijing Business Daily reporter noted that Nanfang Hotel Group Nanjing Jinling Hotel Group recently began to focus on the northern market, and gradually “race horse enclosure” in the northern market.

On April 12, a reporter from Beijing business daily learned that the former Wanyi hotel with a large number of people in Beijing has now been renamed Jinling Hotel in Beijing. Beijing Business Daily also learned from the relevant person in charge of Beijing jinling hotel that Jinling Hotel Group took over the new brand in the second half of last year, and started trial operation on New Year’s day this year. It has been officially opened since March. It is the first business hotel of Nanjing Jinling group in Beijing.

In fact, as early as 2012, Nanjing Jinling Hotel Group began to “go north” to enter the Beijing market. According to public information, located in Pinggu, Beijing, CITIC Jinling Hotel is a five-star high-end conference resort hotel. It is subordinate to Beijing Jinpeng Shengjia Hotel Management Co., Ltd., invested by CITIC Group, one of the world’s top 500 companies, and entrusted to Nanjing Jinling Hotel. It can be seen that Jinling group has long been in the northern market.

The person in charge of Beijing Jinling Hotel also said that before 2012, the Beijing CITIC Jinling Hotel, which landed in Pinggu District of Beijing, had its own owner and was also a member hotel of the group, while the newly signed Beijing Jinling Hotel was operated by leasing and was a wholly-owned subsidiary of Nanjing Jinling group. At the same time, Beijing Jinling Hotel has signed a ten-year contract with the owner, Beijing Renji Real Estate Development Co., Ltd. In addition, when a reporter from Beijing business daily asked whether the Jinling Hotel in Beijing was a high star hotel, the person in charge said that it would not be a star hotel for the time being.

Previously, some tourists commented on the Internet that the interior facilities and software services of Wanyi Beijing Renji hotel before the brand change were old and well regulated. After visiting Jinling Hotel in Beijing, a reporter from Beijing Business Daily found that some service items in the hotel have not yet been fully opened. Hotel staff said that although it is now officially open, but the hotel facilities are still in the process of gradual improvement.

As for the future outlook, the relevant person in charge of Beijing Jinling Hotel said, “our brand hopes to spread across the country in the future, accelerate the implementation of layout, but it also depends on the time, opportunity and actual situation.”.

Beijing Business Daily also learned that as a domestic hotel group, not only Nanjing Jinling Hotel Group, but also Kaiyuan hotel group, which was listed before, has accelerated its expansion since the outbreak. It is understood that in the past March, Kaiyuan Hotel Group opened 7 new hotels, signed 21 new contracts, and entered Shanxi Province for the first time to make up for the original vacancy. At present, Kaiyuan hotel has spread over 29 provincial administrative regions and more than 130 cities. From a series of actions, it seems that local high-end hotel brands are also making efforts to seek a share.

Foreign funded hotels turn over

In recent years, many foreign-funded hotels are constantly facing the withdrawal of their brands, and then change their brands to domestic ones. What is the reason for the rise of local hotel brands?

In addition to the above-mentioned change of the brand name of Wanyi hotel in Beijing, it is not new in the industry that the international hotel brand “delisted” and “transformed” into a local hotel brand in China. As early as 2018, Hilton Shanghai, located at 250 Huashan Road, had withdrawn its license. At present, this hotel has been renamed Jing’an Kunlun Hotel, which is managed by Jinjiang preferred hotel management company. Beijing Business Daily also found that in the same year, InterContinental Beijing Financial Street was transformed into a commercial office building. Not only that, the W hotel on Chang’an Street in Beijing also announced a change of ownership, and its owner, Joy City, sold all the shares of COFCO Hotel (Beijing) to Tianfu fund at a price of 1.984 billion yuan. Even the Sofitel Wanda hotel in Beijing announced that it will be renamed Wanda Mandarin Hotel from January 1, 2018.

It is not difficult to see from the news of “reshuffle” of major international hotels that these well-known international high-end hotels are no longer “popular”, while Chinese local hotel brands are about to rise.

As for the frequent withdrawal of foreign hotels in China in recent years, some people in the industry pointed out that the reasons for the withdrawal of these foreign hotel brands are not the same. Some are due to the decline of hotel revenue, which leads to the owners do not want to pay high management fees; some are due to the huge changes in the domestic market, now that overseas tourism is not open, the number of overseas tourists is sharply reduced, and the market is strictly controlled Heavy impact on hotel revenue and profit guarantee.

In this regard, Zhao Huanyan, chief knowledge officer of Huamei hotel consulting agency, pointed out that with the change of domestic high-end hotel market structure, in the case of unsatisfactory operation of foreign-funded hotels, owners will consider changing and terminate the management contract in advance, which can also reduce the management expenses. Next, more and more hotels will withdraw their cards, and the industry will begin to enter the period of reshuffle.

High end market still needs efforts

In fact, although affected by the epidemic, the chain rate of the whole hotel industry is rising, and the pace of expansion of foreign or domestic hotel groups remains unchanged.

Yang Honghao, a researcher of China Tourism Research Institute, said: “for the withdrawal of international brands, owners have replaced domestic brands. The most fundamental reason is the trade-off between costs and benefits. In the two areas of niche hotels and boutique hotels, international brands still have comparative advantages, and the competitive advantage may last for a while. But now, in the economy hotel, middle end hotel, and many other fields, the domestic hotel brand should be said to have occupied the absolute dominant position. At present, Chinese hotel brands are growing up slowly, and will become more and more mainstream in the future. “

Yang Honghao also believes that the advantage of local brands lies in understanding the needs of Chinese consumers and being close to the Chinese market, so the corresponding products can match the needs of consumers. In addition, the cost of local brands is relatively lower. Moreover, after several years of development, the image of domestic brands has been gradually established, and the confidence of domestic owners, consumers and domestic brands has been gradually established. In addition, we can accept our own brand culture more calmly.

Industry insiders also pointed out that with the continuous growth of the chain hotel team, the number of hotels of local hotel groups will also increase day by day in the future. However, judging from the current market situation, it is still necessary to improve the high-end market share of local hotel brands in order to truly rise.

Beijing Business Daily reporter Guan Zichen intern reporter Wu Qiyun

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