OYO Hotels and Homes, South Asia's largest, China's second largest, the world's third largest and fastest-growing chain of leased and franchised hotels, homes and living spaces, announced that it has already dispensed over Rs 45 crore under its recent Cash in Bank initiative for supporting hotel owner success and customer satisfaction through quality upgrades and renovations.
In a related move, about 1,000 building owners in its chain have been penalized for not adhering to required quality norms for an elevated customer experience and over 9,000 have been awarded under its incentive program. OYO sees the industry's leading service quality in segments and brands it operates.
The penalty imposed on building owners is a result of a comprehensive 3C evaluation programme for all the 10,000+ hotels that are part of the company's growing India and South Asia network. The 3C score of a building is a strong determinant of the building owner's and OYO's commitment to meeting standards and thereby delivering great occupancy and positive recommendations. With utmost conviction towards delivering high-quality accommodation to our customers, any building which does not maintain the necessary 3C level is churned out of OYO's system. The company's focus on ensuring a consistent service delivery across its hotels will be relentless in the coming months.
Overall, OYO's annual retention is as high as 99.5 per cent across the chain in India and South Asia. On an average, over 75 per cent of hotel owners associated with OYO have seen an increase of almost 3X+ in occupancy, a 2.5X jump in RevPar and a significant jump in profit.
Partnering with OYO significantly improves the quality of the standalone hotel and improves occupancy from 25 per cent to 75 per cent on an average within just 3 months, increasing the yield on underutilized assets. It is important to note that OYO hotels is focused on delivering consistent quality of service in South Asia and the world and hence takes certain tough decisions from time to time to aid building owner growth and customer experience success which includes willingness to churn out certain assets.
"We have undertaken a series of measures to enable building owner success and have already invested over thousands of crores in capex, appointed hundreds of GMs to oversee operations and customer experience. The best building owners that work proactively with OYO on improving customer experience enter a 'virtuous cycle' that ensures that growth fuels growth. It is our sincere effort to ensure that all our building owners enter such a growth cycle wherein performance leads to good customer feedback which in turn leads to better rankings which fuels more occupancy leading to better returns which in turn leads to investing back into performance with CapEx and expansion", said Ayush Mathur, Chief Supply Officer, OYO Hotels and Homes.
With the launch of OYO Partner Engagement Network (OPEN) in April, the company had committed to elevate engagement and support the Indian building owner community in every possible way. The launch of Cash in Bank (CiB) facility in May was the second big initiative under the year-long OPEN programme and an industry-first initiative through which OYO provides business advances for renovation and up gradation to building owners in the form of easy to avail, hassle-free and collateral-free trade advances within 48 hours. This further helps building owners to create a never-seen-before 'chic, pop, energetic' look and feel that can further help them improve the guest experience and enhance the business from customers.
"I had tied up with OYO with one property in 2018. Over the last 7 months, I have tied up 2 more properties in the city and now all 3 are running exceptionally well. My revenue has increased exponentially after joining hands with OYO as their Exclusive Partner and needless to say that the guests are happier than ever! It's been a beautiful journey and let's keeps growing together", said Muthalib Karayil, OYO Hotel owner in Kochi.
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"Owing to the recent cyclone Fani, a lot of properties in the coastal belt have been affected. Undertaking the necessary repairs and renovation works to make them customer ready in time for the holiday season would have meant a pillar to post like run to lenders and associates in the community. With the business advance offered within 48 hours of my request, I was able to undertake not just repairs and renovation but also built out additional infrastructure to support the growth of tourist footfalls in the city", said Amit, OYO Hotel owner in Puri.
"We are excited to see the phenomenal response to CiB from our building owner community so far. Within just a month of launch, over 2000 building owners have reached out for business advances to support their renovation or up gradation requirements. In addition to disbursing INR 45 crore last month, we have already enabled interior capex with a 170 crore disbursal pipeline by the end of July. As a company, we are committed to setting industry-first initiatives that support building owner growth and prosperity. We believe this facility has the potential to be a game-changer for our building owners and elevate their relationship with us. We have immense trust in our 9,000+ strong building owner community across 260+ cities in India and aim to continue to innovate and provide the necessary support and assistance to the growing entrepreneurial network", added Ayush.
"I started my first hotel Railview in May 2017. Initially, the occupancy at my hotel was low due to lack of marketing and operations support on-ground. Then I partnered with OYO in September 2017. The entire OYO team helped Railview in all aspects - operations, guest service, laundry set up etc. The occupancy level gradually picked up to 100 per cent by December 2017. Then the Average Room Rate (ARR) slowly increased from INR 1300 to INR 1700 along with consistent occupancy. Currently, I am happy to share that 30 out of the 40 rooms are occupied by repeat customers", said Durga Prasad Pattanaik, OYO Hotel owner in Bhubaneswar.
Notably, over 90 per cent of business at OYO hotels in India is being generated by the repeat, direct or word of mouth customers. What makes this possible is the continued joint commitment between OYO and its building owners to uphold the high-quality service levels and benchmark customer experience and focus on delivering the best quality of experience. As the biggest hotel chain in the country, the focus on customer experience and investments on capex and service will be at the heart of OYO's enduring promise to its 20 million+ customers in South Asia.
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