One of India’s most prominent hospitality industry players, OYO Hotels & Homes, is planning to walk away from its loss-taking and unviable services, including OYO Homes.
In an official statement, Ankit Gupta, CEO, Frontier, Oyo India, and South Asia, mentions,” the company optimized its supply network and exited unprofitable properties.’
While official sources are yet to confirm, it is being said that Oyo is exiting from two co-working spaces from Hyderabad and many more from Bengaluru, Gurugram, and Mumbai.
Oyo has also shut down 4,000 beds and converted 1,700 to Oyo rooms from Oyo Life service-line. According to a company official statement, “We are still identifying more properties as the focus is on profitability.”
While Oyo is one of the companies that the pandemic has hit the hardest, this decision comes to revive their business and become sustainable by letting go of unviable assets.
Moreover, the latest work from home culture has also impacted the hospitality industry, with many small industry players having to shut shop altogether.
While this decision comes with the shutting down of many properties, the company is also planning to add more properties in Bengaluru and Noida, following its current agenda, ‘sustainably grow this business.’
Ankit further adds,” This is more an optimization exercise than one that cuts back or shuts down arrangements. Given the COVID-19 impact, we’ve evaluated our offerings from a lens of quality, scalability, cost viability, and profitability and taken decisions to exit properties where we are not able to create value for our partners.’
Oyo had recently acquired a $200 mn term loan from Softbank to scale out and introduce innovations to its existing portfolio.
Ritesh Agarwal, Founder and Group CEO, Oyo Hotels and Homes, had earlier mentioned,” 2021 will be the year of OYO’s resurgence, as the company focuses on building best-in-class products and experiences for guests, partners, employees, and stakeholders.’