The Indian market is flashing signals of urgency on every global radar, with hospitality no exception. InterContinental is ready to take firm charge of its business in India.
Michael G Herrmann, director of operations, India, Nepal, Pakistan and Sri Lanka, InterContinental Hotels Group, Southwest Asia, tells Sangeeta Singh what the group has in mind
What prompts InterContinental to shift from franchisee operations to management contracts?
Well, InterContinental has been in India for the last 40 years with franchisee arrangements with the Taj, Oberoi, Holiday Inn etcetera. The Indian hotel industry has matured, and we thought the time is just ripe for InterContinental to get into management contracts.
With InterContinental setting up a corporate office for South Asia, and with the India office catering to other markets in the region, the group has done its homework for getting into such contracts - which will enable the group to run hotels the way it wants to, with decision-making powers, and under its own brand name.
Also, with the Indian market expanding from seven-eight brands a few years back to anywhere between 30-40 brands in four-five years' time, the very structure of the hospitality sector is undergoing change and this is the best time for the shift.
So, has a beginning already been made?
Yes, InterContinental has signed up with Today Hotels to launch Crowne Plaza in Gurgaon. Besides, Holiday Inn in Ooty already has a management contract.
We plan to introduce these contracts for all three group brands: InterContinental, which is the luxury brand, Crowne Plaza, which is essentially the meeting and convention brand, and Holiday Inn, which is the mid-segment, four star brand.
We are also looking at converting some franchisee hotels into wholly-managed hotels, which will see primary, secondary and tertiary needs of the hotels all taken care off by the InterContinental group.
But will this not set the group up for conflict with existing managements?
No, we are not turning all franchised hotels into management contracts. But only those where the existing management is also open to the transition. In fact, some franchisee arrangements are working well, and the group has no plans of disturbing them.
But for our forthcoming projects, the model surely would be management
contract.
What are InterContinental's greenfield projects?
We are working in tandem with the growth of the hospitality industry, and we may get into projects anywhere from Goa and Kerala to Andaman & Nicobar islands. Of course, we are also focused on cities like Delhi, Mumbai, Bangalore, Hyderabad, Pune and Chennai, to name a few.
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