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February 23, 2012

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Five-star services at four-star prices

THE opening of Holiday Inn Shanghai Pudong in 1998 marked the debut of the Holiday Inn brand in Shanghai. Since then, the 352-room property has been sitting atop its four-star counterparts - in both occupancy and RevPAR (revenue per available room) - on the east side of the Huangpu River.

However, to retain this position has become a challenge, particularly over the past few years. New international branded hotels have been springing up like mushrooms in expansive Pudong, many in a haste to grasp the once-in-a-life-time opportunity - the six-month World Expo held in Shanghai in 2010.

"Being the city's first and also the largest Holiday Inn hotel, we decided from the very beginning that we were committed to making it a 'flagship' hotel of the brand in Shanghai where guests could expect five-star services at four-star prices," says Gong Qingchao, chairman of Shanghai China Coal Mansion Co Ltd, owner of the hotel. "Competition among hotels in Pudong, as well as across the whole city, has intensified a lot over the last few years. More big names have joined the battlefield amid fast-growing economies and the increasing wealth of Chinese travelers."

Spending his first 23 professional years doing coal imports and exports at China National Coal (Group) Corp, or China Coal, the second largest state-owned coal mining enterprise in the country, Gong is still somewhat new to the hotel industry. He didn't take charge of the hotel operation until August 2006.

"Though I haven't been involved in this industry for long, it seems to me that one of the biggest problems the country's hotel industry is encountering at the moment is a constant short supply of well-trained staff, which is the key to any successful hotel operation," Gong says. "And cost-saving remains another great challenge for us hotel operators as room rates, the main source of a hotel's revenue, haven't changed much in the past few years while everything else becomes more and more expensive."

As one of the first international branded four-star hotels in Pudong, Holiday Inn Shanghai Pudong has been making continuous efforts to retain experienced staff. Gong says it's not easy as there are "abundant" job opportunities due to the opening of so many new hotels.

"Like any other business, there are actually not too many solutions when we talk about maintaining staff loyalty," Gong says. "Improved staff satisfaction, a clear path for future career growth as well as competitive salaries are probably the three most effective approaches we can take to keep people."

In one recent example, the hotel has renovated its staff dormitory, which is about a 15-minute walk to the hotel, and upgraded the canteen and bathroom to improve facilities for its rank-and-file staff.

For managerial level professionals, the hotel is more prone to offer opportunities to take higher responsibilities.

In the field of cost reduction, the hotel's latest endeavours include upgrading its boilers and air-conditioning system. The hotel is also switching to LED lights. According to Gong's forecast, these improvements could cut the hotel's energy bills by 20 to 30 percent.

"Retaining talent and cost cutting are two of our biggest tasks but we are always obligated to do more to improve profitability and stay competitive in the fast-evolving industry," Gong says.

This year, the hotel has already worked out a few initiatives to see whether it could tap new sources of revenue.

For example, the hotel is expanding its recreation and leisure facilities to two complete floors.

A new spa will be launched by the end of this year and it will mainly target people not staying at the hotel, mainly those residing in Pudong who want quality services at affordable prices.

For less than 200 yuan (US$32), a customer will be entitled to basic services including shower, use of sauna rooms and recreational facilities such as the fitness center and card rooms, as well as various snacks. Massage and spa treatments will cost an extra few hundred yuan.

About 70 percent of its guests are business travelers from Europe and the US, thus Holiday Inn Shanghai Pudong has felt the pinch of Europe's debt crisis and the yuan's appreciation against the greenback.

"This year will probably be tough for us," says Gong.

"But we are still quite confident in maintaining a stable business. We will continue to seek opportunities for further improvement to improve customer experience."

Best Deals

Holiday Inn Shanghai Pudong offers 352 luxurious guest rooms, six executive floors including the exclusive Executive Lounge. All rooms feature broadband Internet access, IDD and DDD telephones, voice mail system, LCD TV with satellite channels, mini-bar, refrigerator and iron and ironing board. The "Rain Forest Shower" and spacious desk are other special features.

Holiday Inn Shanghai Pudong is a good choice for conventions and meetings. With its versatile and stylish function rooms, including one ballroom, two breakout rooms and two executive conference rooms, it can accommodate all types of meetings, training seminars, weddings and a wide range of social functions.

The Shanghai Suite features state-of-the-art meeting technology and equipment. The area is 600 square meters and can accommodate up to 400 guests for cocktail, banquet and classroom style functions or 700 guests theater style.


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