Accor Unveils New Strategy to Boost Growth
December 3, 2013 - Hotel operator Accor is planning to focus the business on operating and owning hotels, reversing a previous plan to sell many of its hotels in order to cut debt and focus on expansion in the Asia-Pacific region.
The company has revealed plans to build two businesses managed by a new executive committee with regional directors. HotelServices will operate 3,600 properties, including Ibis, Novotel and Sofitel hotels and will focus on boosting operations and franchising fees. The HotelInvest division will be responsible for widening profit margins at 1,400 hotels in which Accor has an ownership stake. It will be responsible for owning and purchasing hotels.
Accor is looking for the HotelInvest division to account for 75% of its net operating income, up from the current 50%.
Sebastien Bazin, Chairman and CEO of Accor, commented: “Accor is a strong and unique group poised to derive benefit from rich opportunities. However, it deserves a much higher ambition to create sustained value.
“It requires the in-depth, rapid transformation of both its business model and its organization, as well as a clear and long term vision, and to stay the course. With this new strategy, our aim is to unlock Accor's full potential through its two core activities and maximize value creation for shareholders.” Bazin added.
The new focus will allow the company to reduce costs by giving managers more flexibility to make decisions, according to a statement released by the company
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