Low-cost hotels are cheap mainly because of their low cost structure, Including location, scale, operation strategy, market competition positioning, service and facilities simplification and so on. These factors work together to allow hotels to offer accommodations at lower prices. For example, low-cost hotels are usually located in non-core urban areas, small scale, operational process optimization, the use of energy-saving equipment, Establish long-term relationship with suppliers, clear market positioning, relatively simplified services and facilities.

Analysis of hotel cost structure

Hotel as a service industry, its cost structure is mainly composed of the following aspects, including staff wages, benefits and training costs; secondly, Such as utilities, gas costs, etc. ; also occupy a certain proportion, involving the daily maintenance and replacement of facilities and equipment; also can not be ignored, including advertising, public relations activities.

Human resource costsMaintenance costMarketing Promotion Cost

In the cost of human resources, managers, room attendants, restaurant attendants and other positions of wages accounted for a larger proportion, Energy costs are mainly affected by the season, location and hotel size, maintenance costs depend on the hotel facilities and equipment status and maintenance cycle. The cost of marketing promotion increases with the aggravation of market competition.

The hotel also needs to bear certain sum, the fixed assets depreciation expense refers to the hotel building, the equipment and so on in the use process value reduces gradually the part. Taxes and fees, including value-added tax, corporate income tax, these costs in the hotel operation process plays an important role, a direct impact on the profitability of the hotel.

Depreciation cost of fixed assets

Impact of location and scale

Low-cost hotels tend to be located far from the city's busy areas, mainly because they can avoid the high cost of rent due to location.

This location choice allows the hotel to have more flexibility in pricing, can be lower prices to attract consumers.

The environment in the non-core area is relatively quiet, providing customers with a more comfortable open space.

Impact of location and scale

Scale considerations, small hotels or economy hotels often because of its small size, in the operation process can effectively control costs.

Smaller size means fewer rooms, lower energy consumption, and a leaner workforce.

This cost advantage makes smaller hotels competitive in the marketplace, especially among travelers on a budget.

Operation Strategy and Cost Saving

Streamline manpower allocation, clear job responsibilities, to ensure the efficient operation of each link.

Integration of resources, to achieve resource sharing, reduce procurement costs, improve material utilization.

Strengthen training, improve staff skills, reduce the waste caused by operational errors.

Application of information technology to achieve automated management, reduce labor costs, improve work efficiency.

Operation Strategy and Cost Saving

The use of advanced energy-saving equipment such as LED lighting and efficient air conditioning systems to significantly reduce power consumption.

Through regular maintenance and updating of equipment, to ensure that it is always in the best working condition, so as to achieve efficient use of energy.

Promote green office concept, encourage staff to reduce paper use, use electronic documents and online collaboration tools.

In the procurement process, give priority to the selection of environmentally friendly materials and recyclable products to reduce the impact on the environment.

Operation Strategy and Cost Saving

Carefully select suppliers, to create a stable supply chain, cost reduction is obvious.

Mutually beneficial and win-win cooperation model, long-term relations to build a solid foundation.

Optimize the procurement process, fine management, save every penny.

Competition and Orientation of Market

Low-priced hotels in the fierce market competition, usually choose to occupy the position of the low-end market, with its low price strategy to attract a wide range of consumer groups.

This strategy allows consumers to stand out from the pack when they are on a budget and also enjoy basic accommodation needs.

Low-cost hotels through strict cost control, to ensure profit space, for the sustained market competition to lay a solid foundation.

Competition and Orientation of Market

Precise positioning, market segmentation, for consumer groups, to create their services and products.

Insight into consumer needs and provide realistic application scenarios and solutions.

Personalized customization, to meet the diverse needs of different customers, to build a unique market position.

Section 5 Simplification of Services and Facilities

We are committed to simplifying the hotel service process in order to reduce operating costs.

By optimizing the service process, we reduce the time and resources required for staff training.

This not only improves the work efficiency, but also significantly reduces the training cost and realizes the optimal allocation of resources.

Section 5 Simplification of Services and Facilities

The facility simplification strategy is implemented to streamline luxury configuration and reduce unnecessary investment.

Equipment maintenance costs significantly reduced, through optimal management to achieve efficient operation.

While simplifying the facilities, ensure that the quality of service is not affected, providing customers with the convenience and comfort they need.

Reduce waste of resources, put more energy into the core business and customer experience optimization.

A budget hotel through careful planning, to achieve a low-cost operation, it strictly control costs, from procurement, decoration to staff training, Every link strives to save, the hotel uses the intelligent management system, reduces the labor cost, the hotel pays great attention to the word-of-mouth marketing, Through quality service to attract repeat customers, reduce advertising costs, the hotel and surrounding enterprises to cooperate, share resources, reduce operating costs.

In the procurement link, the hotel and suppliers to establish long-term relations of cooperation, for preferential prices, in the decoration, the use of simple style, reduce decoration costs, In staff training, pay attention to the training of staff self-management ability, reduce human resources investment, intelligent management system is to improve work efficiency, Reduce the labor costs, word-of-mouth marketing, the hotel by providing quality service, won a good reputation, attracted a large number of customers.

The hotel also cooperates with surrounding enterprises to share resources, with catering enterprises to share kitchen equipment, and with tourism companies to promote tourism products. In this way, the hotel reduces operating costs and improves overall competitiveness.

Section VI Case Analysis

Accurate market positioning, for high-end consumer groups, quality and service as the core competitiveness, to create high-end brand image.

Target customer groups cover young professionals, entrepreneurs, high-end white-collar workers, focus on quality of life, the pursuit of personalized and high-quality consumption.

Through online and offline multi-channel marketing, accurate touch target customers, to achieve in-depth interaction between the brand and consumers.

Hotel costs include human resources costs, energy costs, maintenance costs, marketing costs, fixed assets depreciation costs and taxes, Human resources costs include employee salaries, benefits and training costs; energy costs include utilities, The cost of maintenance involves the daily maintenance and replacement of facilities and equipment. The depreciation cost of fixed assets refers to the gradual reduction in the value of hotel buildings and equipment. Enterprise income tax, etc.Human resource costs account for a large proportion of hotel costs, especially for managers, room attendants, restaurant attendants and other positions. This is mainly because the hotel as a service industry, staff is the main body to provide services, so human cost is an important part of hotel operating costs.The energy cost is mainly affected by the season, the region and the hotel scale. Can lead to higher energy costs; energy prices vary from region to region; the larger the hotel, the greater the energy consumption. So energy costs will be higher.Hotels can save costs and streamline manpower allocation, clear job responsibilities, ensure the efficient operation of each link; integrate resources, To achieve resource sharing, reduce procurement costs, improve material utilization; strengthen training, improve staff skills, Reduce the waste caused by operation error, apply information technology, realize automatic management, reduce labor cost, Improve work efficiency; adopt advanced energy-saving equipment such as LED lighting and efficient air-conditioning systems to significantly reduce power consumption; promote the green office concept, Encourage staff to reduce paper use, use electronic documents and online collaboration tools; carefully select suppliers to create a stable supply chain, Cost reduction is obvious; mutually beneficial and win-win cooperation model, long-term relationship to build a solid foundation; optimize the procurement process, fine management, Save every penny; precise positioning, market segmentation, for specific consumer groups, to create their own services and products; in-depth insight, Understand consumer needs, provide practical application scenarios and solutions; personalized customization to meet the diverse needs of different customers, To build a unique market position; to simplify the hotel service process, in order to reduce operating costs; by optimizing the service process, Reduce the time and resources required for staff training; this not only improves productivity, but also significantly reduces training costs. To achieve the optimal allocation of resources; facilities simplification strategy implementation, aimed at streamlining luxury configuration, reduce unnecessary investment; equipment maintenance costs significantly reduced, To achieve efficient operation through optimal management; while simplifying facilities, ensuring that the quality of service is not affected, To provide customers with the convenience and comfort; reduce waste of resources, Put more effort into the core business and customer experience optimization; a budget hotel through careful planning, to achieve a low-cost operation, It strictly controls the cost, from the purchase, the decoration to the staff training, each link strives to save, the hotel uses the intelligent management system, reduces the labor cost, The hotel pays attention to the word-of-mouth marketing, attracts the repeat customer through the high quality service, reduces the advertisement expense, the hotel cooperates with the peripheral enterprise, shares the resources, Reduce operating costs.