[photopress:Jingjiang_Inn_Shanghai.jpg,full,alignright]Shanghai-based Jinjiang Inn, China’s oldest and largest budget hotel chain, will add 400 new facilities, with 200 in service by 2010. It currently has more than 200 outlets.
According to its president Xu Zurong, talking to the China Daily, East China and the Yangtze River Delta account for 62% of the company’s operations. It will expand in Beijing, Tianjin, the Bohai Bay area and the country’s provincial capitals and regional economic centers.
Under the plan, most of the $310 million raised last December through its parent company Shanghai Jin Jiang International Hotels (Group) Hong Kong listing will be used to finance the budget hotel chain’s expansion. Xu said acquisitions, leasing and franchises will be the company’s three main avenues for growth. He said, ‘In the last decade, Jinjiang Inn has successfully switched from the management of individual businesses to brand management and operation.’
But, he warned, ‘The franchise business is a double-edged sword — excessive growth might ruin the brand.’ Xu welcomed competition from domestic and overseas players in the thriving budget hotel market. He said, ‘Without competition, we cannot develop. With more competitors on the scene, our strategy is simple to do a good job with our products and market.’
Jinjiang Inn has maintained an average annual occupancy rate of over 90% since it opened its first outlet near the Jinjiang Amusement Park 10 years ago.
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