China has tight sanctions on its Internet sector, which makes it difficult for outsider tech companies to glide smoothly into its market. World’s Internet tech giants like Amazon, Google and e-Bay have failed in China. Amid all these examples, OYO, the Indian budget hotel start-up, is now trying its luck in the neighbouring country.
The company, which is owned and operated by Oravel Stays Private Limited, has set aside $600 million for its Chinese expansion. However, the company is finding it difficult to launch its own website in the country and is not available on some key travel platforms, making it largely dependent on offline booking in China, Live Mint has reported.
The company is still figuring out how it will get regular bookings for its listed 87,000 rooms in 171 cities across China.
“Currently, we lease or franchise 1,000-plus Oyo hotels through multiple platforms including third-party distribution, WeChat (mini app) and we also host a large number of guests through the walk-in channel,” said Yufei Hu, senior vice-president, self-operated hotels and expansion at Oyo China in an e-mail to the daily.
“We have a razor-sharp focus on improving infrastructure and yield of our leased assets while ensuring a quality stay for our guests. We enjoy a healthy relationship with all our partners, including OTAs (online travel agents),” Yufei added.
Penetration in Chinese market is quite crucial for the company as one of the reasons for the sharp rise in the valuation of the company, from $850 million to $5 billion, is the expectations of the investors that OYO would crack the Chinese travel market which is estimated to be over $134 billion.
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