Does It Pay To Choose The Middle Path?

New Delhi was the favoured venue for a `Hot Choice' roadshow last month. It announced the shifting to high gear of mid-market hotel brands marketed by Choice Hotels International, with a larger stake in Quality Inns India Pvt. Ltd, its master franchisee in the country.

Following on its heels, last week, Quality Inns India Pvt. Ltd. changed its name to Choice Hospitality India Pvt. Ltd, probably to identify with its mega shareholder, Choice Hotels International, better. The company, which operates 15 hotels in the country, has seen a recent change in management too with Sushil Gupta as the new chairman.

 

Set up in 1987 by former ITDC chairman-cum-managing director, A K Dave, Quality Inns India started with two properties, one in Mysore and the other in Bangalore. The aim then, as it is today, was to develop three and four star hotels in places other than the metros, which would reflect a credible brand image and would in turn bring in the international tourist and business traveller there. The logic is that if a traveller has an alternative to the more expensive five-star, he will definitely opt for it, provided the right quality of service (air-conditioning, hygiene and ambience) is guaranteed.

As Dave says "the purpose was to draw attention to regions where five-star hotels are not available but where all services of top quality are provided even within the infrastructure of a three-star..''

Choice Hospitality India's USP of fostering profit-oriented hotel product planning and commissioning services has remained the same since its inception 14 years ago. Here `services' could range from site selection, designing interiors, defining technical parameters to providing trained staff, specialised equipment and even helping in accessing funds.

Sunil Mathur, senior vice president of the Indian chain, adds; "Choice International has four categories of hotels: `Clarion' is a five-star category hotel. `Quality' and `Comfort,' which would provide three- and four-star facilities, and the `Sleep' Inns, which provide limited services. In 1987 there were two categories _ `Quality' and `Comfort' . Now all four categories are being launched.''

In a recent upgradation, Choice has introduced the domestic centralised reservation system to facilitate instant bookings for all properties within India.

Is it co-incidental that most of their properties are located in southern India? Dave explains: "To a certain extent, yes. But at the same time the collaborations were done keeping in mind the southerner's demand for the value-for-money travel plans." That explains the presence of Choice Inns in Bangalore, Chennai, Hyderabad, Kochi, Muttukadu and Vijayawada

It is true the middle-rung hotels as a category have remained a disorganised lot, despite the business potential. Franchising for five-star hotels was routine. What Quality Inns India pioneered was franchising in the mid-priced segment. Unfortunately, they have fallen far short in their assessment of the number of hotels they could operate in all these years. Is that the reason for the change of guard? "No'' says Dave emphatically. "I was getting on in years and my son had no interest in this line of business. So, I had to give it up."

Perhaps the new management will infuse the right blood.