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Case Details

Case Code: BSTR560
Case Length: 13 Pages 
Period: 2011-2018   
Pub Date: 2019
Teaching Note: Available
Price: Rs.400
Organization : Oravel Stays Pvt. Ltd (OYO)
Industry :Hospitality
Countries : India
Themes: -
Case Studies  
Business Strategy
Marketing
Finance
Human Resource Management
Technology
Operations
Economics
Leadership & Entrepreneurship

OYO Rooms in China: Scaling the Great Wall

 

ABSTRACT

 
The case is about the international expansion strategy of Gurugram (India) based Online Hospitality Company,OYO Rooms (OYO). In September 2018, OYO check into the Unicorn Club with a funding of $1 billion led by SoftBank Vision Fund, Sequoia Capital, and Lightspeed Venture Partners. The fresh round of funding was expected to boost OYO’s business in China and in other international markets. In May 2018, OYO entered in China, setting a rare example of an Indian consumer technology company setting up operations in the second-largest economy in the world.With this move, OYO was set to compete with well-established players in the country like Jinjiang Inn and Home Inns.

In 2011, Oravel Stays Pvt. Ltd by Ritesh Agarwal, as a platform to enable listing and booking of budget accommodation. In 2013, the company was named as OYO Rooms. Backed by a number of investors the company continued to raise funds and expand. Over the years, OYOforayed intoMalaysia and Nepal.

OYO’s China operations clearly indicated the big bet OYO has placed on foraying east.Further, it had been speculated that OYO was also planning to explore the US and UK markets as well. The case discusses the growth and expansion of OYO in China and the challenges it was likely to face in that highly competitive market. With the arrival of OYO in China, it remained to be seen how the rival companies would respond and whether the company will be able to compete and sustain.
 
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Issues

The case is structured to achieve the following teaching objectives:
  • Understand the hotel aggregation business.
  • Study the franchise strategy in aggregation business.
  • Examine the importance of fundraising for a startup.
Contents
INTRODUCTION
OYO’S JOURNEY
OYO’S BUSINESS MODEL
TIME TO CHANGE
OYO’S ACQUISITIONS & INVESTMENT BETS IN INDIA
SCALING UP IN CHINA
CHINESE TOURISM MARKET: OPPORTUNITIES & CHALLENGES FOR OYO
FUTURE OUTLOOK
EXHIBITS

Keywords

OYO Rooms,Inception and Growth in India,Overseas expansion,Business Model,Entry in China,Scaling up,Opportunities and Challenges,Startup,Fundraising,New product / service development,Global Expansion

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