Hotels in China: A Comparison of Indigenous and Subsidiaries Strategies

Abstract

Abstract

Due to the rapid economic growth in China, tourism and particularly the hotel business has expanded tremendously. The purpose of this research was to compare the strategy and performance of foreign and Chinese owned hotels in China. The findings show that foreign hotels have used selective entry, growth, and management strategies to compete effectively. For instance, incremental growth has been achieved through targeted mergers and acquisitions. Also, foreign run hotels are more profitable than domestic ones.

The Chinese enterprises have been playing ‘catch-up’, but have begun to adopt standard international hospitality practices combined with selective cultural adjustments to achieve growth. One area where they have an advantage is their willingness and ability to locate all over China.

Keywords: Hotels, China, Strategy, Mergers, Tourism, Performance