Research On The Development Strategy Of Chengdu Rongxin Budget Hotel

With the flourishing of tourism at home and abroad and the increasing amount of ordinary tourists, budget hotel has been the main development trend and a popular investment spot of hospitality industry in that it preserves characteristics such as low investment, immediate returns and well meeting demands of mass consumption. The rapid development of economy and tourism of Chengdu, the economic, political and cultural centre of southwest districts, also booms the growth of budget hotels.As a newly emerging local budget hotel of Chengdu, Rongxin Hotel has already had several chain stores in Chengdu. With its convenience, efficiency and its healthy and environmental friendly style, it has been a nice choice for tourists from both inside and outside Sichuan province. However, at the same time, Rongxin Hotel is faced with an increasingly fierce competition. For one thing, many domestic well-known hotels such as Jinjiang Hotel, Home Inn,7 Days Inn have entered Chengdu’s budget hotel market. In addition, many other local brands like Holiday Flat, Nancheng Hotel, Yujinxiang Flat are also developing rapidly. In the background that the competition in Chengdu’s budget hotel market is heating up both at present and in the future. This paper aims to solve the strategic problem of Rongxin Hotel in its developing process.First of all, this paper introduces the rising and growing of domestic budget hotels, especially in Chengdu. By combining that with Rongxin Hotel’s status quo, it tries to figure out the strategic difficulties of Rongxing Hotel and draws the conclusion that coming up with an efficient competitive strategy is the most important thing Rongxin Hotel should deal with at present. Combining with Classical Strategic Management Theory, this paper studies on the external environment of Rongxin Hotel by using PEST Analytical Method; By adopting Baud "Five Forces Model of Competition", it also analyzes the industrial competition environment that Rongxin Hotel is in. In application to the Internal Value Chain Analytical Method, this paper analyzes the interior resources of Rongxin Hotel and looks deeply into its advantages and disadvantages; At last, by applying for TOWS Analytical Method, this paper comes up with an optimal competitive strategy which includes three sub-strategies of focusing strategy, difference strategy and branding strategy for Rongxin Hotel. At the same time, for the sake of ensuring the operability of the competitive strategies, this paper also proposes some executive plans to put the competitive strategy into practice by using successful management experiences from the top hotels at home and abroad for reference.