Business / Industries

Hot springs feel the chill of anti-corruption

By Mu Chen (China Daily) Updated: 2015-01-02 11:19

Hot springs feel the chill of anti-corruption

A small yard of Chun Hui Yuan Resort in Shunyi district, Beijing. Many resorts in Beijing have turned to group buying on the Internet to reach potential customers, as there have been many empty banquet halls and conference rooms at hot spring resorts this year. [Photo Provided to China Daily]

Government austerity campaign lets the steam out of resort business

Beijing's hot springs are feeling the chill as corporate spending cuts have seen bookings for events and end-of-year banquets dry up, forcing resorts to drive down prices in order to adapt to the new realities of the market.

Two years ago, November would have marked the start of the peak season for Rylinwon Resort and Spa in the Shunyi district of Beijing.

The resort and, in particular, its function rooms would have been fully booked for corporate events right through to the Chinese Spring Festival, usually between late January and mid-February.

This year, there have been a lot of empty booking slots for the two banquet halls and the handful of conference rooms at the resort, said Rylinwon's sales manager, surnamed Zhang.

"Business has been doing okay but the wider environment has definitely affected our business. With the dip in large corporate clients, we have had to reconsider our business strategy."

The "wider environment" he is referring to is the government's austerity campaign, which started in late 2012 and has curtailed spending by State-owned enterprises.

Although the growing spending power of China's private enterprises has helped offset some of the plunge in demand left by SOEs, the resort has still had to fundamentally change its client base to lower-spending individuals and families in order to survive, Zhang said.

Rylinwon, and many other resorts, have turned to group buying on the Internet to help increase their reach to potential customers.

However, with such large numbers of hot springs vying for customers online, prices have been driven down considerably.

A one-day pass to Rylinwon's hot spring facilities retails at 368 yuan ($59) but purchasing it via one of the many group buying platforms online costs only 138 yuan, a price the sales manager knows all too well.

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