Growth of Budget Hotels in China: Antecedents and Future

Abstract

The Chinese hotel industry is undergoing brisk growth, particularly in the budget hotel segment. Thus, an exploratory study was conducted to determine the factors facilitating growth of the budget hotel market. A strengths, weaknesses, opportunities and threatanalysis was undertaken to identify future trends and to assess market potential. Relevant implications and suggestions were made to the industry so as to remedy the identified weaknesses and overcome the threats. Some regression models about the expansion of different star-rated hotels in China were also developed. It was found that overall disposable income was the most significant factor in explaining and predicting the number of budget hotel rooms.