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Tujia sees rich pickings from overseas tours

By Fan Feifei | China Daily | Updated: 2019-04-04 09:32
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Home-sharing service users try local dishes at a home in Haikou, Hainan province. [Photo/Xinhua]

Tujia.com, a Chinese online platform for booking shared accommodation, will beef up its presence in overseas markets, such as Japan and Southeast Asia, which are especially favored by Chinese travelers, as it strives to boost its revenue in 2019 by 100 percent year-on-year.

"We will continue to increase investments in overseas markets, such as establishing branches or subsidiaries in popular tourist destinations and cooperating with local home-sharing service providers," said Yang Changle, CEO of Tujia.

"Our revenue has increased 15 times in the past two years, and the trading volume accounted for more than half of the industry's total turnover, which shows consumers' recognition of the short-term rental sector is on the rise," Yang said.

He estimated that the company will achieve quarterly or monthly profitability, with its loss being reduced to one-third of what it was in 2018, without disclosing exact figures.

According to him, the country's accommodation sharing industry will maintain high-speed growth this year, and might make a breakthrough in legalization. For instance, owners of short-term rental houses will have a legal identity, and safety standard of the shared homes will be in accordance with that of hotels.

"However, there is no law to regulate home-sharing services at present, which is the biggest challenges we face," Yang said, adding that the Chinese government has a positive attitude toward the sharing economy.

In October, the State Council released an action plan for 2018-20 to further stimulate domestic consumption.

Market access should be relaxed in several service-related fields, such as tourism, and efforts to boost the development of short-term rental services, such as rental apartments and guesthouses, are encouraged.

Launched in 2011, Tujia lists 1.4 million online homes, including apartments, homestays and villas across 400 Chinese cities and more than 1,000 overseas destinations.

It is targeting the rapidly growing outbound travel market. Last year, it acquired Fishtrip, a Taiwan province-based bed-and-breakfast booking platform. The move added about 300,000 quality overseas properties to its listings.

The company set up a small team in Japan in 2016. It also teamed up with Rakuten Lifull Stay, an e-commerce company in Japan in 2017, with an aim to boost its presence in Japan to take advantage of the 2020 Tokyo Summer Olympics.

According to a report by the State Information Center, the market for home-sharing services is expanding rapidly in China, with the sector's revenue expected to reach 50 billion yuan ($7.4 billion) by 2020.

"The short-term home rentals and homestay services are wide-ranging now to satisfy the needs of various kinds of tourists. Typically, customers hire such services for get-togethers, reunions, team-building activities and to improve parent-child bonding and communication," said Lai Zhen, an analyst at market research firm iResearch.

Liu Junhai, a business law professor at Renmin University of China, said short-term rental websites can help promote optimal utilization of existing resources like rental housing.

"The market is not mature yet. The quality of management should be improved. Online platforms need to strengthen their self-discipline," said Liu.

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