Kochi Hotels Revolt Against Oyo Rooms; 1000 Chinese Employees Will Be Fired From Oyo China?

Oyo is in trouble?
Oyo is in trouble?

Made in India hotel network Oyo Rooms is facing trouble: Both in India and in China.

This is worrisome, because Oyo has become China’s 2nd largest hotel chain within 20 months, and is about to become World’s biggest hotel network.

What exactly is happening here?

Kochi Hotels Will Boycott Oyo Rooms

Starting Wednesday, Kerala Hotel and Restaurant Association (KHRA) has declared strike against Oyo Rooms.

Around 67 hotels are part of this association, and they have decided not to accept any bookings under Oyo network.

As per Committee chairman Muhammad Rameez, there are several issues with Oyo Rooms, which needs immediate attention.

Profit sharing, for instance.

As per Rameez, Oyo has forced the hotel owners to bear the brunt of the online discounts offered by the company to customers. Earlier, it was Oyo which used to pitch in with the reduced profits due to heavy discounts.

And, the problem of cash flow: It takes 30 days for Oyo to clear the payments, which has made hotel owners restless.

Besides this, it is not easy to leave Oyo. 

They take 90 days to process the entire quitting mechanism, and they even hijack all contact details of the customers.

The association has said that they will not turn away the customers who have already booked their stay with Oyo, but will not accept any new bookings.

Oyo has responded by saying that the hotels calling for Oyo boycott are not even associated with them. 

A company spokesperson said, “Most of the boycott claims are being made by small vested interest groups with no property franchised with or leased to OYO Hotels. As franchisors, we continue to engage with our franchise hotel owners on a one-to-one basis to resolve issues and in case we don’t reach a mutually acceptable solution, we can part ways amicably.”

Oyo Is Firing 1000 Chinese Employees?

In related news, some publications have reported that Oyo China is firing 1000 employees.

This has created quite a stir in China, where labor laws are very strict, and where Oyo Rooms has managed to become 2nd largest hotel chain within 2 years.

As per PandaDaily, Oyo Rooms offices in China will reduce their development team from 3000 to 2000 employees.

Oyo Rooms has strongly refuted these reports, and have said that the employees leaving the company is a routine exercise, and they have hired way more than this number.

A company spokesperson said that Oyo Rooms have hired 10,000 employees, and this month alone, they have hired 1500.

He said, “Facts are being twisted and misrepresented. In the last few months, we have hired over 1,500 people and will have over 10,000 full-time employees. The resumption of any letting go is wrong, where regular monthly performance reviews are being twisted and reported out of context.” 

Oyo Rooms has informed that they have crossed 5 lakh rooms inventory in China, and they will invest $100 million in the next two years for more expansion.

We will keep you updated, as the news infolds.

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