Asian Paints, where is thy heart?

Asian Paints, a Mumbai-headquartered India’s largest multinational paint company, has been known for creating some really humourous television advertisement campaigns (TVCs). I have personally liked and enjoyed watching TVCs from Asia's fourth largest paint company claiming to have a turnover of Rs 202 billion. However, their latest TVC for the Shyne range of paints for interior and exterior walls that I came across a week ago was purely in bad taste to say the least.

Not sure if you have seen it yet? Unfortunately, I'm unable to share the video weblink of the TVC because it’s been removed by the uploader at the time of writing this piece. Am not sure if the advertisement has been taken off air as well. I’d seen it yesterday or the day before while catching up on my daily dose of comedy serials on Sony SAB and &TV. (UPDATE as on August 30, 2020 - The advertisement continues to be showcased in a truncated form on some TV channels and in full on a few others.) I was unable to reach Asian Paints for an official comment on the status of this TVC and their reasoning behind giving this campaign a go ahead. A few memes of this TVC are in circulation as well so do look it up on Google or YouTube for the message this company was painting in the market.

Just to tell you briefly, the TVC basically attempts to create an impression on a small town boy’s friends about the shiny wall paints and that the boy’s family must have loads of money to be able to afford a high quality paint for their house. The discussion veers into undertaking foreign travel for holidays because the boy brags about having loads of money. That’s when destination Singapore comes into play leaving the boy's friends in awe.

The next scene shows the boy’s father entering the house with train tickets in hand, announcing that the family is going to Kolhapur for holiday. The father adds that they will get 'Kolhapuri chappals" for the boy’s friends on their return journey. In a catch 22 situation, the boy is seen making faces expressing disappointment while his friends poke fun at him and call his bluff.

This TVC might seem to be a light-hearted humour to many. But, I’d like to differ on that opinion. And this is purely from the point of view of an Indian citizen and a customer of products manufactured by Asian Paints. I understand there is already a huge uproar on this inappropriate ad campaign from local political parties and consumer groups in Kolhapur.

I can’t blame them either. Just imagine, an Indian MNC downgrading an Indian city/ destination in the minds of young Indians. How does it classify to be a light-hearted humour? If our domestic destinations are going to be looked down upon by such messaging from large Indian MNCs, how do we expect to preserve heritage into the minds of our children, forget instilling a sense of pride.

What’s further appalling is that the advertisement has been conceptualised by none other than Ogilvy India. This agency has, in the past, made some really wonderful and laudable campaigns including “Incredible India”. Additionally, Ogilvy has worked with Madhya Pradesh Tourism, Maharashtra Tourism Development Corporation (MTDC) and Gujarat Tourism to name a few on creating their respective tourism campaigns.

Taking these into consideration, I am sure the agency executives are well aware of the hard work that goes in creating a long lasting positive impact for domestic destinations in the minds of the domestic and international travellers alike. And after knowing all this, they come up with something that’s utterly disgusting not only for the people of Kolhapur but the entire nation.

There’s no doubt about Singapore being a world class island city-state and its potential to attract tourists from across the globe. However, as an Indian company we also need to take pride in our heritage and this TVC basically attempts to demean/ degrade a prominent Indian city and a domestic tourist destination. More so because Kolhapur has a rich cultural and historical heritage in addition to being of special religious significance - The Ambabai Temple is one of the Shakti Peethas listed in various puranas of Hinduism. You can read more about the significance of Kolhapur as a tourist destination here.

In a world dominated by digital and social media platforms, a right advertising campaign / message can work wonders for the company and its brands. However, if marketing managers and brand custodians are going to take things for granted the impact will be seen on the company’s goodwill and the consumer connect the brand has established through decades of hard work. Asian Paints, where exactly thy heart is?

(The writer is a Mumbai-based independent business journalist and has extensively covered diversified consumer businesses over the last two decades. He can be reached at hello@ashishktiwari.com)

“Pod hospitals can significantly enhance quality of healthcare infrastructure and delivery in India”

The COVID-19 pandemic has created havoc across the globe especially countries lacking specialised and quality healthcare infrastructure to treat those infected with the coronavirus. The pandemic also exposed the fact that the gap between demand and supply of healthcare infrastructure and delivery is only widening by the day and that there is an urgent need to come up with solutions that will help bridge this gap timely, effectively and efficiently. The pod smart hospitals concept, according to Mahesh Krishnachari, director and founder of the design and build firm “Vevra”, is one such game changing solution to the problem at hand. Read on for more details.

What led to conceptualising the pod hospitals? Is this something you’ve been working on for some time now?

It all started after the lockdown was implemented earlier in March. We all watched the chaos this pandemic has brought upon the healthcare infrastructure and delivery space. We also realised how helpless we were in addressing this situation. Being a design and build firm we began brainstorming for possible solution(s) to deal with airborne diseases like COVID. That was the starting point for this pod hospital concept.

We wanted to devise a futuristic solution that would prove beneficial in the effective treatment of such diseases that may surprise us going forward. The idea was to come up with a concept that can be easily scalable and ensures timely delivery of quality healthcare services.

A lot of efforts have gone into understanding/ identifying the pain points, taking feedback and interacting with healthcare professionals from the United Kingdom as well as doctors from private and government hospitals in Bengaluru. Additionally, feedback was also sought from nurses and other hospital support staff including the Class IV employees. This exercise revealed that lack of quality infrastructure was and continues to be the key issue in the treatment of diseases like COVID-19.

All the data and intelligence gathered were studied and brainstormed by the Vevra team to come up with possible solutions that will help overcome the hurdles in the overall healthcare delivery process. A fully-furnished prefabricated pod hospital concept was the outcome of this exercise.

Could you tell us about some of the key pain points being addressed?

Sure. I think one of the crucial issues was that doctors, nurses and hospital support staff were getting infected from coronavirus while performing their duties. So designing a safe “PPE” donning and doffing area for doctors and nurses who were getting exposed to this airborne virus while overseeing the treatments was critical to minimise the spread of this infection.

Most doctors were getting infected in the doffing area, basically at the time of removing their personal protective equipment (PPE). That’s because doctors and nurses are moving in an open area with 100 to 150 COVID positive patients and there is a huge viral load in the treatment area. Being airborne the viral load settles on the PPEs worn by the doctors and nurses. And these viral particles were infecting healthcare professionals at the time of removing the PPEs in the doffing area.

So irrespective of how many COVID patients a hospital is treating, if the healthcare staff including class IV workers are at a greater risk of contracting the virus due to lack of proper facilities, then we are not really fighting COVID effectively.

And the Vevra pods hospitals are capable of addressing this issue?

The ideal solution to address this problem, in my view, is to control the air quality inside the COVID treatment area(s) thereby curtailing the spread of this virus. That’s one of the key features of the pod hospital concept we’ve designed. The air getting circulated inside the premises is getting exhausted and fresh air (filtered using HEPA filters) is being pumped into the pod.

Eighty per cent fresh air and 100% suction ensures negative pressure in these pods. This is very important especially for patients in intensive critical units (ICUs) requiring oxygen, are on a ventilator and so on. You cannot have the same air circulating or split/ centralised air conditioning and that was the reason for the government to issue an advisory on use of ACs in such areas.

Apparently, the ICU section in most hospitals have a maximum of 15 to 20 beds. Besides, no hospital in India has got negative pressure ICU’s to treat any airborne disease. Pumping fresh air and exhaust the air at regular intervals brings down the load of viral particles inside the pod. As a result the possibility of these viral particles settling down on the PPEs worn by healthcare professionals, nurses and support staff is very low. This in turn helps reduce the spread of virus and related infections.

The fully furnished and prefabricated ICU and operation theatre pods designed by us can thus come very handy in such situations. This apart there are other variants like the general pod, doctors stay pod and scanning room pod that ensure patients being treated for such pandemics apart from other ailments can be properly isolated while ensuring there is no compromise on the quality of healthcare delivery. These pods are not just the regular mobile isolation rooms but a completely functional, fully furnished, internet of things (IoT) and artificial intelligence (AI) integrated smart hospital setup. (More details about the features of these pods can be found here)

What was the reason for partnering InnoWave group?

That was mainly for technology required to monitor the patients’ health records as well as the medical equipment inside the pod. We couldn’t find a local technology partner who could meet our requirements. I reached out to a former colleague from a Portugal-based company who was working with an internet of things (IoT) firm. We exchanged notes and figured out the synergies. It was a coincidence and a good one too. Interestingly, InnoWave was already doing this in hospitals across Europe and the Unites States of America (USA). However, it would be the first time this will be done in a movable pod hospital set up in India.

How far have you reached with this concept?

The conceptualising part was completed in May and its designing was finalised in June. Thereafter we got into sourcing the raw materials required for making the pod. Incorporating the negative pressure aspect was challenging because we couldn’t find a company who could do it in a movable pod. We were fortunate to find a company based out in Bengaluru, sourced the systems/AHU’s from Luxembourg based company that had the expertise and agreed to take up the project.

The prototype is currently in very advanced stages and we are testing the functionality, efficacy and mobility of the pods in our manufacturing facility. After thorough testing at our end, we will test the healthcare delivery through these pods on hospital premises to see if there are any final tweaks required. The pods will then be delivered to the healthcare facilities for treating patients. This will take a few more weeks. The pod hospitals will go live on hospital premises that have expressed interest in having them for specialised healthcare delivery.

Are these pods made used shipping containers by any chance?

These can be made using shipping containers. However, our pods are built using other durable and recyclable materials. Every care is taken to ensure we are meeting the required guidelines and standards of building a hospital premise. Our pods are made of a prefabricated structure and its surface, walls and roof is completely antibacterial. The power requirement is up to 20-25 kilowatts resulting in a monthly electricity bill of around Rs 25,000 or so. There is a three-and-a-half feet gap between each bed which is enclosed by thick PVC curtains that acts as a barricade for additional safety of patients.

While its designs are owned by Vevra, I don’t mind opening it to someone who’d like to do this on a large scale. As for the size of these pods is concerned, it is similar to that of shipping containers because it’s been done keeping the mobility aspect in mind. These pods can be transported anywhere by loading it on a low-bed trailer and it can be shipped to other countries as well.

Can these be used to construct modular hospitals?

Definitely. The pods can be annexed to existing hospital premises depending on the kind of open space they have. This ensures there is no cross contamination in the main hospital building when treating COVID patients. In fact, if the structural design of the hospital is good enough to take another five to six tonnes of load, we can easily place these pods on the hospital terrace (after analysing the building structure).

Another advantage is that the hospital can scale it up from four beds to 100 beds depending on the requirement. It can be done in a small space of 400 square feet to 100,000 square feet. We can also stack it one above the other to make a ground plus one hospital structure. The pods can be built in two weeks and shipped to the hospital/ healthcare service provider. The reusable, easy to maintain structure can be used for 20 years without much hassles.

There is a dearth of healthcare infrastructure facilities in Tier II, III, IV locations and rural India.

This concept can make a huge difference across such locations. This set up is also very appropriate for companies looking to set up or upgrade healthcare facilities at their manufacturing units located in the interiors or for that matter undertake healthcare related corporate social responsibility (CSR) activities in these areas. Overall, I think pod hospitals have great potential to significantly enhance the quality of healthcare infrastructure and delivery in India and across emerging markets.

Will these help in bringing down the cost of COVID-19 or healthcare treatments in general that’s going through the roof?

I cannot really comment on that because pricing the healthcare delivery will be decided by the healthcare service provider. As for the costing of our pods is concerned, we haven’t yet arrived at the final pricing either since final testing of the prototype is still underway. Besides, I am also working on various permutations and combinations of this pod hospital concept so that it can be made available across price points depending on the hospital’s requirement. The IoT and AI features will be offered on a subscription basis allowing hospitals to switch on/off depending on the requirement. All I can say is that pod hospitals are way too economical as compared to the conventional structure. And the best part is that it comes as a fully furnished unit.

How much have you invested in this concept so far? How are you funding this development?

It’s been done through internal sources so far. We will be looking at external funding in terms of bringing in a financial partner or even a strategic investor. We haven’t yet decided on the quantum of funding to be raised as all the focus currently is on getting the pod hospitals up and running.

Will you be looking at a leasing model for the pod hospital infrastructure?

Yes. A lot of hospitals may not have financial resources to acquire it upfront. In such cases leasing the pod hospitals for a certain number of years or maybe even renting it for a predefined period makes more sense. The lease model can certainly be explored on a case to case basis.

(The writer is a Mumbai-based independent business journalist and has extensively covered diversified consumer businesses over the last two decades. He can be reached at hello@ashishktiwari.com)

“India has lost a huge opportunity to convert outbound travellers into domestic”

It’s all coming back but not as I’d imagined. While domestic travel is witnessing some activity, it’s still to pick up steam. I think it will happen gradually, feels Himmat Anand, founder, Tree of Life Resorts. In this candid conversation, Anand speaks about the hospitality market scenario as India unlocks in phases, consumer behaviour, present and future business prospects, manpower issues and other challenges surrounding the hospitality, travel and tourism industries. Edited excerpts…

It’s been a little over two months since Tree of Life Resorts opened for business at some locations. How has the journey been so far?

 

Tree of Life Resort & Spa Jaipur was the first one to open and it has taken-off really well. In fact, I’m quite amazed with the market response. Jaipur is a clear indication of the fact that if the source market is closer the resort will do much better. The Jaipur resort continues to clock between 65% and 68% occupancy levels at very good average room rates (ARRs).

 

We opened the Tree of Life Vantara Resort, Udaipur on July 1, 2020 followed by Tree of Life Kipling Jungle Lodge, Ranthambore on August 1, 2020. It’s taking time for business to pick up at these locations. We are doing around 20% occupancy which is alright given the current market scenario.

What hasn’t worked for the Udaipur market?

For Udaipur, Gujarat is the main source market. We were expecting the Gujarat market to respond quickly but that hasn’t happened as people are still very cautious about travelling. Mumbai is another good source market for Udaipur however, the coronavirus pandemic situation is quite dramatic in the commercial capital right now and people are still apprehensive about travelling.

 

You were among the few hoteliers to announce an opening date well before the unlock process started. What made you take that decision? How has it panned out finally?

 

We took the call to open our resorts in May 2020. That’s because businesses have to open and there is no such thing as ‘the right time to open’. You can either keep waiting or take the plunge and chalk out your own destiny. Yes, we were among the first ones to open for business and the decision was based on certain calculations like the lockdown will start to ease out starting June first week. Our assumption was that Punjabi households of the National Capital Region (NCR) will definitely head out for a short vacation with family. That’s something I was banking on in addition to the Gujarati households who’d venture out, for obvious reasons, after being confined in their houses for an extended period.

 

While the assumptions did work for the Jaipur market it didn’t pan out in the way we imagined for Udaipur. We were to open Jaipur resort on the June 19, 2020 weekend. But we’d already received booking from June 15, 2020 onwards as a result we opened for business before the targeted date. The guest profile was 100% domestic leisure travellers mostly from NCR-Gurugram.

 

While business gradually picked up in June, we closed July with 68% occupancy and an ARR of Rs 10,800 for Tree of Life Jaipur. The numbers were way better than what we’d done in July 2019 wherein the occupancy levels were between 45% and 50% at ARRs of about Rs 8,000. On a year on year basis, ARRs were higher by 30% to 35% while occupancy levels were up 36% over the same period last year.

 

We’ve done phenomenally well during July this year in Jaipur resort and August numbers are looking equally encouraging. What’s surprised me the most is that the luxury pool villas selling at Rs 14,000 a night (including breakfast) were the first ones that got sold out. In fact, even today, there are little chances of a guest getting a luxury pool villa unless pre-booked well in time.

 

Are travellers booking directly or coming from other trade channels?

 

Most of them are direct followed by bookings through the online travel agencies (OTAs). What also worked for us is that during the lockdown period, we aggressively used the social/ digital media platforms like Facebook, Instagram and Linkedin to ensure top of the mind recall for brand Tree of Life resorts across locations.

 

Every day there was some or the other activity planned on these platforms and we were approaching the business as if our hotels are still running. This not only ensured visibility/ recall but also helped us stay connected with the market. Our social media connect was very strong and the strategy has paid off well. So, when the unlock happened bookings began flowing in from the very next day we opened for business.

We also went with aggressive pricing on the OTAs. We started with heavy discounts to the tune of up to 50% in June, brought it down to 40% in July and cut down further to about 30% in August. I think by October the overall discounts will be down to the normal 10% to 15% levels.

The customary annual price hikes starting October will be a strict no-no in that case?

Beggars can’t be choosers so we’ll have to accept whatever best room rates we can get from the market. All is good as long as the hotel is able to meet its expenses and pay salaries to employees. Fortunately, we don’t have the burden of interest payments to banks. The loans on our books are internal as we are still a family owned company. So I don’t really have a bank sitting on my head every month seeking interest payouts.

 

There are talks about 40% to 50% of hotels going out of business owing to financial stress.

 

That’s indeed going to happen. In our case, while we have a loan to pay back, we are very fortunate that if I can’t pay today I have the flexibility to pay it later. There is no pressure on my business and we can breathe easy in the current financially stressed market conditions. That doesn’t mean we are taking advantage of the situation, loans will be paid back and there are no two ways about it. Having a breather for the next six months is a big advantage. I will be able to restructure the debt and pay it back thereafter. I think that's a huge positive for our company.

 

Why in your view are people still averse to travelling/ holidaying?

The overall scare in people’s mind about travelling, in my view, is mainly due to the continuous hammering across media outlets about the number of people infected by the coronavirus. I think India is way better off than most nations given the size of population. However, the media hype has put a spanner and delayed revival of the domestic travel market.

 

Secondly, there is a huge outbound market comprising 20 million Indians who travel overseas. However, due to lower number of operational flights these travellers are unable to pursue international travel. My assumption is that nearly 3 million people would travel during the July to December months.

What’s the hurdle in tapping this huge market of outbound travellers?

 

I’d thought that the outbound tour operators will actually tap this captive market and convert them into domestic travellers. That hasn’t happened because the outbound tour operators have not been as proactive on that front as they could have been. Inbound tour operators catering to international travellers are anyway stuck and can hardly do anything in the domestic travel segment given its peculiarity and the need for client relationships.

 

I think India has lost a huge opportunity in activating and converting outbound travellers into domestic travel. However, there is still time because I don’t see the frequency of international flights happening till November first week or so. We still have two to three months in hand and the outbound tour operators need to wake up to this opportunity.

 

How are guests responding to all the safety and hygiene practices being showcased by hotel companies?

The hotel industry has got egg on its face as far as health, hygiene and safety matters are concerned from a customer’s point of view. I think industry players have overhyped the situation demonstrating a plethora of practices and whatnot. But let me tell you, the customer isn’t really interested in these cosmetics. All that the guests are looking for is basic hygiene including the standard guest onboarding procedures being prescribed by the regulator.

 

By creating all the hype about hygiene practices, the hotel industry has actually scared away potential guests.

 

Hotels have anyway been practicing the highest standards of hygiene and cleanliness irrespective of COVID-19 pandemic situation. There was confidence already built in the guests’ minds about the hotel industry’s focus on hygiene and cleanliness so what was the need to make such a song and dance about it anyway.

What has been the experience like on these matters in your resorts?

At Tree of Life resorts, we apprise our guests about the prescribed precautionary measures being taken at our properties. Thereafter, if the guest(s) asks for any additional precautionary measures to be taken we are more than happy to do it.

 

For instance, we have cameras installed in our kitchens and the guests have the option to watch the food preparation on their mobile phones. Similarly, all rooms are sanitised before the guests walk in and we also give them the option to re-sanitise the rooms in their presence. Not more than 5% of the guests have asked for the rooms to be re-sanitised.

This is a clear indication that the guests’ trust and resilience is already there and she/he is very happy with the basics being done at the resort/ hotel premises.

 

I think the guests aren’t as paranoid as the hotel industry has made it to be. They are coming to a resort to relax, walk around and experience the open space, something they aren’t able to being confined in their residential apartment. We have taken all necessary precautionary measures and I can confidently tell you that we have not had a single complaint about lack of hygiene matters on the resort premises.

 

Another aspect to be mentioned here is that while the hotel is responsible for the guests’ safety, the guest is equally responsible for their own safety in the resort. It cannot be 100% my job. The guests have to play their role and take necessary precautions like wearing their masks at all times, washing their hands, maintaining physical / social distancing and using sanitisers when in public places.

 

Travel was also curtailed due to restrictions imposed by local administrations in certain states / locations / regions?

Yes, these decisions have impacted travel plans. Local administrations need to take a stand and stick to it like Himachal Pradesh (HP) did saying no tourists will be allowed till August 15, 2020. However, there was a flip-flop situation in Uttarakhand every second day. Same was the case with Goa, Kerala, Karnataka and Andhra Pradesh (AP) if I remember it right.

 

I think the state governments also need to make up their mind. While lockdown happened very efficiently for a country of our size the unlocking exercise has made a total mess of it. Look at the situation with restaurants, while food can be served liquor has been banned. I just don’t understand the logic behind this move. Our unlocking has been a total disaster for the Indian hospitality and food service industry.

 

Of your resorts bouquet, only three are currently operational?

 

Four actually. The Tree of Life Grand Oak Manor, Binsar Wildlife Sanctuary has been opened for guests as well. The ARRs are low at about Rs 4,500 in Udaipur, Ranthambore and Binsar but I am hoping business to pick up as tourists from Gujarat seem to be warming up to the idea of holidaying.

Three more properties viz. two in Kerala and one in Dehradun will open in September. So all resorts in the Tree of Life portfolio will be operational well before the business season that’ll kick start in October.

Are the resort operations sustainable at such room rates?

 

Not really. We will be losing money for a month or two. Right now profit is not a consideration for Tree of Life. I am willing to risk running the business for a small loss for two or three months. I will take that chance because I cannot wait till October, November or December to keep thinking about how to move the business ahead.

 

My focus currently is to build occupancy across my resort properties. Average room rates are not really my target because we need cash flow. Besides, it’s occupancy that will bring in the cash flow not ARRs and I’m very clear on that. My objective is, If I have to discount, I’ll discount to ensure cash flow and I’ll bring back the pricing eventually when the market starts to look up.

 

A lot of hotel companies have cut down on staff strength.

 

All hoteliers have had to retrench/ lay off employees unfortunately because it was a business necessity during the lockdown period. We all had no choice as the market scenario was such. It wasn’t done to save money. There was no money to even pay salaries.

 

As and when the opportunities are arising I’m reopening the properties with half the capacity. We are also going back to our staff and asking them to rejoin. While I still can’t pay full salary it’s important to start somewhere. For me, it’s not a business obligation but a moral one towards my people.

 

I must also admit here that we haven’t been able to pay pre-COVID level salaries to our staff. However, with business picking up at our Jaipur property and hopefully at our other resorts in the coming months, we are working on gradually bringing the salaries closer to the pre-COVID scale.

 

Having retrenched earlier, hotel companies are now rehiring for the same positions albeit at much lower pay scale and unreasonable preconditions?

 

In fact, I am amazed looking at the approach by some multinational hotel companies / brands coming out with fresh/ new recruitment advertisements for all positions in their respective hotels. This is a very disappointing trend I am seeing currently on staffing.

 

Ideally, preference should be given to existing employees who were retrenched and only after they refuse should the hotels look outside. I don’t see any reason why former employees will not join considering they have been out of work for long and they have a family to support.

 

Hotels with significant debt on books are uncertain about their existence leave alone survival. What’s your advice for them?

 

Keeping this thought process in mind, I’ll respond in two parts. One thing that’s happened with us is that in the last two months, a number of asset owners have expressed interest in being a part of the Tree of Life network. Reason being that as an independent hotel operator, as you rightly pointed out, their survival over the next three to four years is going to be very difficult.

 

I’m a small inventory hotel chain with 10 to 20 guestrooms in each property that we currently operate. Independent hotel asset owners want to be associated with our brand and leverage on our strengths. As we speak, four contracts are under advanced stages of discussion and by next month we should be adding four or five properties to our portfolio of resorts.

 

So at a time when business is shrinking for a lot of hotels, we are confident to be able to generate enough revenues and we know that very well. While there are a lot of such discussions we may not sign all of them. We have shortlisted five that fit very well in the scheme. Our feeling internally is that we should be able to work together very well with these properties. That’s one part of the story.

Now let me answer the second part. I think the only thing that can give hotel owners sleepless nights is loan payback. So asset owners without any loan liability on the property should not have much of an issue right now. There is no need for them to get adventurous particularly those located in the Tier II and Tier III markets. That’s because the moment you’ll open there will be some of the other expenditure that will come up and that’ll kill you for sure. So it’s best to remain shut till October - November. Also, if the asset owner is among those thinking about making a profit by opening then let me tell you upfront, no hotel will ever make profit over the next six to nine months.

 

However, those servicing loans on their respective hotel assets will have to find a way to restructure the debt. For these asset owners survival is all about managing the loan because I don’t think business is really a criteria for them right now. My view is that many will not be able to restructure loans and a lot of distress sale assets will be up for grabs in the coming months because the Reserve Bank of India’s interest moratorium ends on August 31, 2020. While the RBI has offered a one-time debt restructuring option it is unlikely banks will extend the facility to hotels and restaurants owners considering long term uncertainty looming over these businesses.

 

Given the current and future industry scenario, what’s going to be the fate of aspirants currently studying hotel management and those who’ve graduated this year?

I think these are tough times for students especially those graduating this year irrespective of the education stream being pursued. While every other industry is facing challenges the level of pain differs. Having said that, there are industries especially in the digital space that have gained significantly and are busy chalking out plans to tap the future growth opportunities.

 

While hospitality, food service, travel and tourism are among the badly hit my view is that over the next couple of years every sector will go through a restructuring process and cost rationalisation will be key to accomplish this exercise. However, hospitality industry aspirants and professionals need to keep this in mind that we are a part of an industry that thrives on personalisation and guest experience.

Irrespective of the level of digitisation or automation that one can think of it cannot overlook the fact that hospitality is a people’s business and will remain so for years to come. While percentages can vary, I do not believe that the hospitality industry can be do without its people, especially the leisure segment. The room to staff ratio will obviously undergo a significant change particularly in the case of large inventory business hotels.

All in all, the next 24 months are going to be challenging for every business including hospitality, travel and tourism. However, I’m not only confident about a revival in the overall market scenario two-and-a-half years from now but also the fact that there won’t be any dearth of opportunities for hospitality industry aspirants and professionals. Students currently pursuing should utilise this time to make themselves future ready while working professionals will have to reinvent and find newer ways to stay relevant and thrive in these challenging times.

(The writer is a Mumbai-based independent business journalist and has extensively covered diversified consumer businesses over the last two decades. He can be reached at hello@ashishktiwari.com)

Google Play Music to be replaced by YouTube Music starting October 2020

Here’s a piece of news for all smart phone users. Come October 2020, Google will kick start the process of replacing its popular Google Play Music app with YouTube Music. In a communication sent out on Friday afternoon, the global technology giant said that, “Google Play Music is going away soon”.

“YouTube Music is replacing Google Play Music as your new destination for music listening and discovery. Between October and the end of this year, access to Google Play Music will be removed permanently. We know that you've spent time building your Google Play Music library, so we've made it easy to transfer your music library to YouTube Music with just one click, including playlists, uploads and recommendations,” Google said in the email.

While YouTube Music, according to Google, looks a bit different from Google Play Music, it has been built by the same team with the same passion. “It also offers more than 65 million official songs, albums and playlists, as well as many features that you love and expect from Google Play Music,” said Google adding that music can be transferred to YouTube Music app available for downloads on Google Play as well as App Store. Alternatively, music files can be transferred using the browser as well.

As for what happens to the user’s Google Play Music library and data, the technology giant said, “In addition to transferring your library to YouTube Music, you have the option to download any music that you've purchased or uploaded to Google Play Music, as well as a list of the tracks, playlists and radio stations in your library. We'll notify you before you lose access to your Google Play Music library and data. You can also delete your Google Play Music data.”

On Music Manager and uploads, Google said that uploading and downloading music with Music Manager will be discontinued starting in 30 days. “But don't worry – you can always upload your personal music collection to YouTube Music or download your existing tracks via Google Takeout,” said Google.

Also, starting in 30 days, the Music store on Google Play will go away. It will no longer be possible to purchase music on Google Play, and all pre-orders will be cancelled. So, when you transfer, your purchases will move with you to YouTube Music. Talking about ‘Radio and background play’, Google said that Background play is only available to paid users of YouTube Music. “However, the free version of the music app allows background play for your uploaded or purchased songs,” it said.    

(The writer is a Mumbai-based independent business journalist and has extensively covered diversified consumer businesses over the last two decades. He can be reached at hello@ashishktiwari.com)

After pod hotels it's time for pod hospitals especially designed to treat COVID-19 patients

After making inroads in the Indian hospitality market three years ago with Urbanpod, the pod concept has now made its debut in the Indian healthcare space.

Vevra, a Bengaluru-based design and build company in partnership with a Portugal-based healthcare internet of things (IoT) company InnoWave Group has introduced a pod hospitals concept in India. Christened ‘Vevra Pods’ the movable healthcare facility has been designed to fight the COVID-19 pandemic, other contagious/ airborne diseases and comes integrated with artificial intelligence (AI) to treat patients effectively.

According to Mahesh Krishnachari, director-founder, Vevra, the Vevra pods are not just the regular mobile isolation rooms seen before but a completely functional, fully furnished, AI integrated smart hospital setup. “This is an avant-garde, futuristic hospital. These capsules/ pods can be annexed to the existing hospitals to create more patient beds when in need or can be deployed to any remote place, areas struck by calamities, or even military bases to act as a complete hospital unit,” said Krishnachari.

The Vevra Pods project, as per a company statement, was primarily born as an answer for major medical crises of any form, where the lack of appropriate facilities/ infrastructure to receive highly infected patients takes a toll in most hospitals across the nation. This project consists of a set of movable capsules that aims to efficiently assist in the infrastructure of local/ private/ government hospitals across India.

Available in five variants viz. General pod, ICU pod, Doctors stay pod, Operation theatre pod and Scanning room pod, each Vevra pod can accommodate four to nine beds.

These fully furnished modular Pods come with advanced IoT solutions at the heart of its operation on ViGIE+ platform by InnoWave. This infrastructure consists of antechamber airlock rooms to provide a safe area for healthcare professionals with antibacterial walls and surface, it also controls the quantity and quality of the air being circulated in and out of the room with a minimum of 12 air changes per hour through HEPA filters, UVC lights, high-end exhaust system with PLC integrated air conditioning system to help in maintaining the temperature, humidity within.

Features of Vevra Pods

• These pods come with an antechamber airlock room to provide a safe area for healthcare professionals to do Donning and Doffing and to store the medical supplies. 
• Introducing a negative air pressure in the pod to contain airborne diseases such as TB, Flu, and COVID-19. It also controls the quantity and quality of the air being circulated in and out of the room with a minimum of 12 air changes per hour through HEPA filters, UVC lights, and a high-end exhaust system. 
• The pod comes with PLC integrated air conditioning system to help in maintaining the temperature, humidity within. 
• The pod comes with Fire resistance structure and an anti-bacterial wall and bacterial and chemical resistance flooring. 
• An attached toilets and shower cubicle with UVC lights. 
• ICU pod comes with a provision for Oxygen supply, analyzer as per ICU guidelines. Integrated with a device to monitor oxygen supply pressure and to measure the oxygen concentration delivered by ventilators or breathing systems along with a failure alarm system. RO water purifier, Geyser in the shower area, 500 litre water storage tank along with Mobile Sewage Treatment Plant. 
• Fire alarm, extinguisher and emergency system with a safe evacuation plan. CCTV surveillance and Television provided for each patient. 
• Re-usable after Pandemic with 15 to 20 years’ structural warranty. Can be moved to any remote location in the world.
• Sufficient UPS power backup with earthing connection to each pod and I-3 processor Laptop loaded with AI, RFID and MS office. RFID controlled entry and exit.

The healthcare Pods, according to Dr. K Sudhakar, medical education minister, Government of Karnataka, are innovative movable hospitals integrated with AI and can help in containment and prevention of contagious diseases. “AI has the potential to transform public healthcare and I urge healthcare start-ups to focus more on developing innovative, low-cost solutions,” he said.

Elaborating on the ViGIE+ platform, the company said, it is used for collecting and visualising data from different sensors installed inside and provide real-time alarms if environmental conditions change. This solution can be quickly and easily deployed in remote areas that are not easily accessible to hospital staff as well outside of the main hospital buildings to avoid any risk of the virus spreading.

“This project is highly linked to our mission as a company – to change people's lives through innovation. We are specialised in IoT monitoring systems in Europe and the USA, and we are eager to embrace this project and expand in other regions, as we are already cooperating with the US companies to supply ViGIE,” said Tiago Gonçalves, chief executive officer, InnoWave Global.  

The pods, said Dr. C N Manjunath, Indian Cardiologist and director of Sri Jayadeva Institute of Cardiovascular Sciences and Research, look like a pioneering concept of much safer and advanced facilities for not only patients but doctors as well, during times of high risk.

(The writer is a Mumbai-based independent business journalist and has extensively covered diversified consumer businesses over the last two decades. He can be reached at hello@ashishktiwari.com)

50% of hotels in India in danger of getting sick over the next six months, says Patanjali Keswani, CMD, Lemon Tree Hotels

Fifty percent of hotels in India, according to a top hotelier, are in danger of getting sick over the next six months. And this is mainly due to leverage and liquidity related issues.

Expressing concerns on the overall health of the Indian hospitality industry, Patanjali Keswani, chairman and managing director, Lemon Tree Hotels Ltd, said, ”Short term demand destruction over the next six to 12 months, without an extension of the moratorium, will certainly lead to permanent supply destruction. What this basically means for the industry is that there will be a 10% to 25% reduction in (hotel rooms) supply in the branded hotels space in India by next year. While some of them may come back but new supply will be impacted severely. As far as I know, very few people, if at all, are building (new) hotels or are continuing to build hotels. Right now there are 165,000 hotel rooms and my reckoning is that two years from now there will be anywhere between 130,000 to 140,000 rooms operating.”

And if that happens, added Keswani during an earnings call earlier today, I reckon that hotels that remain operational will not witness a big drop in room rates. “So, maybe this October the pricing (rates offered to corporate clients) will remain the same or may decline marginally compared to last year. However, next October the room rates will certainly bounce back significantly,” he said in response to an analyst’s query on the outlook for corporate rates that get renegotiated annually during this period.

Keswani said that any hotel company that has operating hotels two and a half years from now, will be in a market scenario where supply would have reduced significantly. “While I cannot speculate on the increase or decline of demand for hotel rooms, I know for sure that there will be an enormous reduction in supply of branded hotel rooms in India. Also, whichever corporate that I have spoken to, all their employees are of the view that that cannot go to work. My expectation is that from October next year the market will witness a very large amount of domestic travel. Fear has to go, cure has to come, vaccine(s) may or may not come but domestic travel will kick-start and there is no doubt in my mind,” he said.

The current market scenario has got every organisation in the cash conservation mode. However, there are also talks about an opportunity for companies sitting on cash to acquire hotels that are under financial stress.

”We already own 5,200 hotel rooms and are building another 700 plus rooms so we will be closer to 6,000 guestrooms soon. I don’t think we have an appetite to acquire assets. Having said that, a fund is already in talks with us to manage their hotel assets portfolio. The hotels will be acquired by the fund and we will be managing their properties. We are looking at that opportunity and are hoping that in the next two months we will be able to do a term sheet with them to manage their hotel assets. This (deal) will significantly expand our managed hotels portfolio under the Fleur Hotels joint venture,” said Keswani adding that the focus going forward will be on growing through management contracts, lightening the balance and moving owned assets into Fleur Hotels and its possible listing in the next few years.

Lemon Tree Hotel is also envisaging delays in construction activities as a result of which opening of hotels that are currently under development will take longer. The hotel chain has been developing a five-star deluxe hotel under the Aurika brand, located in the vicinity of the Mumbai International Airport. The largest hotel in Lemon Tree’s portfolio in terms of the number of guestrooms, this property was to open in the third quarter end of calendar year 2022.

“However, for the last five months hardly any work has been done at the site. At Rs 2 crore a month, the expenditure today is not very significant as we are building the shell of the hotel in the vicinity of the Mumbai International Airport. We have kept the project work on with an expectation that it will be delayed by six to nine months. We will take a call in December this year based on what we see because our existing hotel Lemon Tree Premiere in Andheri, Mumbai is already doing 60% occupancy at an average room rate (ARR) of close to Rs 4,000. So, if we feel Mumbai is recovering, and it normally recovers first, we will accelerate the project development.

On the business front, the country’s largest mid-market hospitality chain has operationalised close to 90% of its hotels in the portfolio. It is currently witnessing occupancy levels of about 38%. The hotel chain was operating 3,700 hotel rooms in the first quarter and the number of guestrooms increased to 4,600 in the second quarter.

”While rooms inventory has gone up by 900, we are hoping occupancy to pick up over the next two to three months,” said Keswani adding that business form quarantine guests witnessed a slight de-growth in July. “But that was compensated by pick up in online bookings,” he said adding that market sentiments are undergoing a change and business from quarantine guests is only a filler now.

Online booking stood at 70 per day in April 2020, however it has picked up gradually and currently stands at 300 bookings on a daily basis across Lemon Tree’s hotels network, said Kapil Sharma, chief financial officer, Lemon Tree Hotels Ltd.

The room rates from online bookings, Keswani said, is between Rs 2,800 to Rs 4,000. “A large part of the bookings is in the Rs 2,800 bracket as these are people looking for a break and are staying at the hotel with wife and kid(s) over the weekend. It’s the micro, small and medium enterprise (MSME) segment that’s picking up 100-150 rooms a day and paying north of Rs 3,500,” said Keswani.

Business from online bookings stood at between 35% to 37% for the hotel chain during pre-COVID times. Another 35% was coming from large corporates, business from MSMEs was at 30% and 10% was from other categories like meetings, conferences and incentives.

“Contrary to what I have been reading about complete distress in the market, I find that while the large corporates have not started travel, their business continuity teams are travelling and staying in our hotels in Pune, Bengaluru and Hyderabad. However, the MSME sector has started travelling and to me that is an early indication of something to look forward to,” said Keswani.

Lemon Tree Hotels is also planning a rights issue though there is no timeline finalised for the same as yet. While a board approval for the rights issue is already in place and the company management planning to hold a board meeting next month and take a final call on this. “It should roughly take two to three months,” said Sharma.

(The writer is a Mumbai-based independent business journalist and has extensively covered diversified consumer businesses over the last two decades. He can be reached at hello@ashishktiwari.com)