What is the profile of your business customers?
We target both sales people and workers who have travel packages and their bosses who appreciate the quality of our hotels, which are close to the higher categories, but at much lower prices. We have a very good market share within what we at B&B Hotels call the "CAC 300,000", the 300,000 SMEs that make up the strength of the French economy. On the other hand, we have few corporate contracts. Our duty is to offer a fair price. And, as it is calculated as precisely as possible, there is no room for discounts of 20 %.
What is your top priority at the moment?
As well as uncompromising prices, we make another promise to our customers: to be present wherever they expect us to be. To this end, we are accelerating our expansion. We opened 32 hotels in 2017, and we will be opening at least one a week in 2018, with the aim of reaching more than 620 hotels by the end of 2020, compared with 440 today.
we will be opening at least one hotel a week in 2018, with the aim of reaching more than 620 hotels by the end of 2020, compared with 440 today.
Is France at the heart of this ambitious development strategy?
We found that there were around a hundred secondary towns, such as Annemasse or Saumur, where we have no presence and where there is a real demand for budget hotels. To fulfil our mission properly, we need to cover all these areas, which we will do over the next few years. At the same time, we will be strengthening our network in the major cities. We recently celebrated the opening of our eleventh hotel in Lyon, just 10 minutes from Perrache station. We have 1,100 rooms in this city, which is already considerable. But the potential is there to eventually have 1,500 or 2,000 rooms. That gives you an idea of how far we have to go in cities like Lyon, but also Marseille, Lille, Montpellier and others...
What about Paris? Are you thinking of setting up a B&B in the heart of the capital?
We already offer almost 4,000 rooms in the Paris region. It's our biggest market. Although we already have around ten hotels on the outskirts of Paris, we have been looking for years to break through the barrier of the ring road. But at the moment, property prices within the walls of Paris don't offer any real solutions for providing reasonably priced rooms. But we're continuing to work on this. It will happen, because it's an exceptional situation that you almost only find in London or New York, whereas in Berlin, for example, we have a hotel near Potsdamer Platz. We are also on the Puerta del Sol in Madrid, opposite Milan's main railway station and soon to be near the Duomo in Trastevere in Rome. Everywhere else, we manage to offer hotels right in the heart of major cities.
As well as strengthening your position in France, will your international expansion be just as strong?
That's for sure. In five years, we have doubled our turnover, significantly increased the number of our hotels but, above all, our network has changed radically. France's share of our offer was 70 % in 2013 and is now just 50 %. With 106 establishments in Germany, we are proud to have become the leading budget hotel operator, a position that is set to strengthen, as we open around fifteen hotels a year in this country.
With the acquisition of Sidorme in 2016 and H2 Hoteles last January, you are now very well positioned in Spain.
Is this country another major focus of your growth?
In fact, we are now the leading budget hotel operator in Spain, with around thirty establishments. We have acquired two small groups, but we have also built and converted hotels. We're doing everything we can to build up a dense network in Spain as quickly as possible, with around a hundred establishments. The objective is the same in Italy, although it will probably take a little longer. We're growing at a rate of five or six establishments a year, with recent openings in Milan, Bologna, Cremona and Como.
When you're number 1 in Germany, Italy and Spain, and number 2 in France, going to Switzerland and Belgium seems a logical next step.
Does your future also lie in other European countries?
When you're number 1 in Germany, Italy and Spain, and number 2 in France, going to Switzerland and Belgium seems a logical next step. We are opening two hotels in Zurich this year, and have plans for Basel and Geneva. In Belgium, we are establishing ourselves for the first time in Antwerp, with another hotel under construction in Brussels, opposite the Gare du Midi. Our brand will also appear in Portugal and soon in Austria, and no doubt also in Denmark, Slovakia, Slovenia and Bulgaria, all countries where we also have projects. Finally, we have set out to conquer another continent, a gigantic market, Brazil, with our first establishment opened six months ago and another under construction in Sao Paulo. We look forward to Rio.
Could your growth ambitions involve new acquisitions?
We're thinking about this. We bought two channels recently and we're thinking hard about a third, fourth and fifth. We will have the support of our shareholders to become one of the leading players in Europe. Budget hotels is growing fast worldwide, supported by major multi-brand groups such as AccorHotels, Louvre Hotels and IHG, as well as single-brand players such as us, Premier Inn and Travelodge in the UK, and Motel One in Germany. Not to mention other specialists in the sector in India, China and Mexico. Ultimately, we believe that the market will consolidate. And we will do everything we can to be on the right side of the fence, on the consolidating side rather than the consolidated side.
Alongside this strong desire to develop your offering, how is your product evolving?
We want to continue to offer our customers an increasingly high-quality and personalised product. As a result, we are investing €150 million between 2017 and 2019 in renovating our hotels. We are now aware that customers do not necessarily expect the same thing from a budget hotel in a major city as they do in a slightly less central area. That's why we've launched a new concept designed by the Blanchet d'Istria agency for urban hotels. On the other hand, outside the big cities, we're going to offer things that are a little fresher and more colourful. We need to adapt and personalise the way we address our customers.
How are your hotels developing?
The big issue at the moment is opening up our communal areas. When you think about it, the traditional version of the hotel business, with the reception on one side and the breakfast room on the other, is pretty old-fashioned. What do people usually say to guests when they arrive? 1) Please queue. 2) Show me your papers. 3) Show me your money. There's that, and then there's the breakfast room open between 6.30am and 9.30am. Outside this time, please don't come in because it might get dirty. We're in the process of reviewing all this in our hotels.
In what ways?
By the end of the year, all our hotel guests will have a genuine remote check-in system. We have already started to implement this in Germany and for our loyal customers in France. Check-in can be done using a smartphone or the internet, and guests will receive a direct access code to their room. This also allows us to do away with reception desks, with two practical consequences for business travellers. Firstly, instead of doing administrative work, hoteliers will be able to concentrate on their job, which is to welcome their customers, provide them with information and talk to them. At the same time, we'll be able to install sofas and make this a place where people can relax rather than queuing behind a counter. The same thing is happening in the breakfast room. Sofas and guest tables are installed, and power sockets, connectivity and screens are added. In short, everything you need for coworking. It works really well in the hotels where we've done it. It creates life in the off-peak hours of the day and meets the expectations of business travellers who are not just looking for a bed, but also places to work.
