South Strategy

In accordance with times

Patience and re-invention are the only ways to survive in the declining market, says Harikumar B, GM of The Accord Metropolitan, Chennai. By Aishani Thakur

With occupancy levels of hotels across the city hitting an all time low, Chennai, like most other places, has not escaped the grips of the economic slowdown. For most hotels, it has been a struggle to maintain the market average which, at present, is 50-55 per cent. But, The Accord Metropolitan, despite the drop in ARR's by 15 per cent, has fared fairly well in their first quarter. With the regular corporate travel curtailed, the focus of all the luxury business hotels has now shifted to conference, leisure and other new segments. Harikumar B, GM of The Accord Metropolitan, Chennai, explains that leisure travel has always been part of their marketing strategy. According to him, this is the reason why they did not take much of a beating in their first quarter performance despite being a business hotel. He is also of the opinion that corporate Asian markets will remain, and hence will continue to be a part of their marketing, keeping in mind that quantity sales is the need of the hour. His hotel's marketing efforts are also directed towards promoting different packages that appeal to newer segments.

The Accord Metropolitan Chennai way

At a time when many companies are considering options of downsizing their staff, Harikumar has a different approach to it. He says, "It has been important for us to keep our human assets together in these difficult times and I am proud that our team members have stood by us strongly during these times. As a policy, we have not laid-off any member of our team or made any cuts in salaries, but are careful about filling up vacant positions. Each department of the hotel has studied its load versus staffing ratios and has come up with need of the hour ideas to utilise man-hours in the best manner possible."

Even though alternate hospitality products such as serviced apartments, time shares etc are slowly gaining popularity, according to Harikumar, they cannot displace the rightful place that is being held by mid and upscale hotels.

The way ahead

Harikumar feels that in a city like Chennai, tourism has not been a trump card to lure visitors, and there is definitely adequate room for more activity on this front. According to him, the tourism ministry should step in and help boost tourism in Chennai. However, he adds that various tourism associations have been working in solidarity to help this sector recover.

Harikumar places his bet on the mid market segment, but, in Chennai, the number of rooms being added to the luxury segment far outweighs the rooms added to the mid-scale segment. This, according to him, will bring down ARRs as the market is not growing at the pace of the rooms that are being added to the inventory. Also in future, he predicts luxury hotels operating at mid-market prices.

Giving his perspective about the future, Harikumar predicts "The market is definitely going to take time to come back to reasonable levels and the only way is to be patient and keep reinventing ourselves to be able to tackle this. This period has given us an opportunity to look at our operations in a new light. We are inspired by the countless opportunities in front of us to make our operations tighter without letting go standards. This time has also been used to get back to grass root levels in out operations by training and process organisation."

He also mentions that the smaller cities in the southern region lack mid and upscale hotels and this segment poses as an opportunity. "For me the next big regions on the hospitality map are Pondicherry and Coimbatore, they show tremendous growth and opportunity." signs off an optimistic Harikumar.