However, compared with several other competitors, Hanting started the latest. When Ji Qi left Home Inn, he signed a non-compete agreement and would not enter the same market as Home Inn within two years. Ji Qi kept his promise, and it was not until 2007 that Hanting began to expand on a large scale, entering the economy hotel sector in Jinhua with GreenTree Inn. This was the latest market entry time among similar competitors.
"The economy hotel still has dozens of times growth space. In the future, economy chain hotels of a certain scale will account for 50% of the market share, and now it is less than 1%," Ji Qi said.
"Home Inn is early, big, and widely networked, 7 Days Group is low cost and cheap, Jinjiang Inn is steady, and the characteristic of Hanting is good," Ji Qi commented on the leading players in the economy hotel sector.
Both Home Inn and 7 Days showed amazing expansion speed after going public. Then, facing such a huge market prospect, will Hanting accelerate its expansion after going public to narrow the gap with competitors?
"A good company must be able to endure loneliness," Ji Qi said. In Hanting's new three-year plan, Ji Qi's calmness and steadiness are still evident. From 2010 to 2012, Hanting plans to expand at a scale of 80-200 stores per year. Among them, 60-70 of the newly added hotels this year are directly operated stores, next year there will be 80-100 new directly operated stores, and in 2012, there will be 100-120 new directly operated stores. This means that directly operated stores still occupy a vast proportion in Hanting's total store opening scale in the future. After Hanting went public, Ji Qi also said that the funds raised from this IPO would mainly be used to develop directly operated stores.
In 2008, after withstanding the洗礼of the financial crisis, the number of new Hanting hotels was reduced to 100, mainly focusing on Hanting Express, which is positioned as a standard economy hotel. In the following year, Hanting maintained such a store-opening speed. However, in these few years, the other older brothers in the economy hotel sector have already fully utilized their resources and expanded aggressively. By the end of 2009, Hanting had 236 hotels under its wing. The number of opened hotels by 7 Days reached 337, "the leader" Home Inn had 621 opened hotels, and Jinjiang Inn had 325 opened hotels. Currently, these numbers are still increasing. Recently, 7 Days announced that it would accelerate its expansion this year, planning to open around 170-200 new hotels.
From both domestic and international perspectives, developing directly operated stores requires significant investment, and hotel chains are mainly franchise-based. Including Home Inn, which adopted a franchise strategy after going public to vigorously develop franchise stores, originally primarily directly operated 7 Days also planned for most of its new hotels this year to be franchises. For Hanting, franchising is undoubtedly the most "economical" and fastest way to catch up with competitors' scale. Why does Hanting's new plan still maintain such a large proportion of directly operated stores?
Ji Qi explained that Hanting adopts a balanced development strategy of directly operated plus franchised stores to consistently ensure the quality of Hanting's store openings, "If they were all directly operated or franchised, the quality of the hotels would be affected. We must take quality assurance as a prerequisite, Ningbo Kaiyuan Group, Guizhou Yinzhai flower blooming time: early March, Hotel reservation 24-hour free hotline: 4007840076, sincerely serving you, speeding up development." Ensuring store quality as a prerequisite.
At the beginning of 2005, Ji Qi created the "Hanting" brand, positioning it as a mid-range chain hotel specifically designed for business people. In less than five years, Hanting has developed three major brands: "Hanting Express" for the economy segment, "Hanting Hotel" for mid-end business, and "Hanting Haiyou Inn" for budget hotels. Its presence has expanded from Shanghai to Suzhou, Wuxi, Nanjing, Hangzhou, Ningbo, and other places.