Oyo is hurting independent hotel owners
What’s going on?
What’s going on?
Oyo is using its $ 1bn warchest to disrupt Indian hotel industry. It’s deep discounting.
Oyo is selling rooms at 50% to 60% discounts. Rooms for 2,000–2,500 are now being sold for Rs 800–900.
Oyo and Go-MMT ( Go Ibibo / Make My Trip) are also asking for commissions between 25 to 40%.
How is it impacting the hotel owners?
Online brands are arm twisting the small businesses to accept their terms and conditions. Startups have big legal teams, which scare independent owners.
High commissions isn’t good for the business. After meeting the expenses of running the establishment owners have to pay commission between 25% to 30%.
Oyo is not meeting their promise of minimum guarantee. It is asking owners to shift to dynamic pricing.
Arbitrary payment deductions, penalties leaving almost nothing with hoteliers, and misbehaviour with staff and hotel owners are other companies.
What are they doing?
Hotels are getting together under associations to give ultimatum to online players. Nearly 650 owners have come together to fight for their cause.
They are asking to cap commissions at 18%.
Owners want the government and Competition Commission of India to intervene.
Read more: Report by Anumeha Chaturvedi