ROOM FOR GROWTH
TBY talks to Sarun Limsawaddiwong, Managing Director of S Group, on the various hotels in the company's group, new trends in the industry, and his predictions for the group.
BIOGRAPHY
Sarun Limsawaddiwong has a bachelor’s degree from B.F.A. Centenary College in New Jersey and a master’s degree in design study from St. Martin, London. He has wide experience in the tourism sector.Can you give an overview of S Group's background and hotel portfolio?
Our hotel business is a family business. I started the business eight years ago with the S15 Sukhumvit Hotel, and S Group now has five hotels. Our philosophy is to try and spread our risk over every market segment. We offer a range of different styles of accommodation and have hotel rooms priced from THB800 up to THB20,000 per night and room sizes ranging from 8sqm up to 400sqm. One philosophy that we have held is that each of our hotels has a different style, yet everyone who stays at an S Hotel can see certain characteristics in what we offer. The overall aesthetic is modern, clean, and affordable. Location is the most important factor and a crucial feature; we always choose locations next to BTS Skytrain and/or MRT stations in central Bangkok. We do look at potential new BTS lines and transportation expansion plans; having said that, we tend to concentrate on the Sukhumvit area because over the last eight years we have found that this is the most successful and popular location for our hotels. These are the main characteristics common to all our hotels. Yet, we offer variety in size, location, and facilities between our various hotels.
What are some of the latest trends in the hotel and tourism industry in Bangkok and Thailand in general?
Around 30 million tourists visited Thailand in 2015. Of that number, 60% came from East Asia and of that percentage 40% came from China. The growth in tourist numbers from East Asia and China continued in 1Q2016. We expect that over the next five years tourists coming here will be mostly from these areas. China has many different kinds of travelers, from budget and agency to elderly tourists and the luxury market. However, now most Chinese tourists come here on what are called “zero dollar" tours. With these tours, tourists are obliged to buy goods while they are here, such as jewelry, and in return their travel and accommodation is free. The tour agency pays for the trip and it takes a percentage of the money paid for goods by the tourists. These agencies manage to make money from this system. We work with the agencies that organize these trips. For example, we booked 200 rooms at our S Ratchada Leisure Hotel for one of these tours from China.
What is the future of S Group in five to 10 years?
There are two parts. The first issue is how we will serve the Chinese tourists coming here while the other side of the equation is waiting to see when tourists from other countries will start returning to Thailand. This includes tourists from Russia, Europe, and the US. We are also looking closely into the budget range; we have now positioned five hotels in this range because demand is increasing in the low-cost segment of the hotel market. This is where we will focus in the next few years. Within the next five years S Group aims to reach 1,000 rooms. At the moment, we have 560 rooms in total.
What are your expectations for 2016 in terms of occupancy rates and revenue?
Our total revenue in 2016 will not be lower than THB500 million. What I am concerned about is cost, and how in 2016-2017 we can increase our prices because this is a difficult thing to do YoY in the Thai market. Right now, I am not worried about the occupancy rates in our hotels; these are around 80-90%; however, I am worried about costs because hotel rates in Thailand are cheap, even cheaper than Myanmar, for example. Many investors want to enter the market in Myanmar now as demand is high there. Looking at the region, the most interesting location for us is Vietnam; however, it is a difficult country in terms of people and political factors.
ROOM FOR GROWTH
TABLE OF CONTENTS
Review: Diplomacy
The Times are Changing
The West may have taken a dim view on the 2014 coup, but China has been less judgmental about Thailand's domestic policy and the two countries have grown closer over the past couple of years.The West may have taken a dim view on the 2014 coup, but China has been less judgmental about Thailand's domestic policy and the two countries have grown closer over the past couple of years.
read articleGuest Speaker
HE Maithripala Sirisena, President, Democratic Socialist Republic of Sri Lanka
TBY talks to HE Maithripala Sirisena, President of the Democratic Socialist Republic of Sri Lanka, on celebrating 60 years of relations with Thailand, boosting bilateral trade, and potential opportunities with the AEC.
read articleFocus: Special Economic Zones
Zone Home
With numerous upcoming major trade deals like the TPP and CAFTA, in addition to Thailand joining the ASEAN Economic Community, the country is developing a host of strategically located and incentivized SEZs to take advantage of the upcoming opportunities.
read articleFocus: Auto Sector
Driving Force
A combination of slower global economic growth and weaker domestic purchasing power suggests that Thailand's renowned automotive sector is heading for flat growth in 2016, thereby encouraging the government to promote cutting-edge innovation across the industry.
read articleFocus: Gems & Precious Stones
Shine Bright
As a key driver of the economy, Thailand's vast manufacturing sector comes in different shapes and sizes—and colors, for that matter. One segment to have really emerged as a sparkling export opportunity over the past two decades has been the country's gems and precious stones industry.
read articleInterview
Dr. Pichet Durongkaveroj, Minister, Science and Technology
TBY talks to Dr. Pichet Durongkaveroj, Minister of Science and Technology, on the initiatives to boost innovation in the country, facilitating greater private investment, and fostering mutually beneficial partnerships with countries.
read articleFocus: E-Commerce
Down the Wire
In 2014, when Chinese e-commerce giant Alibaba made headlines for listing the largest global IPO in history (USD25 billion), many had come to recognize that the industry, which was typically dominated by Silicon Valley heavyweights, was gravitating drastically eastward.
read articleInterview
Anantachai Kunanantakul, Chairman & CEO, Siam Eastern Industrial Park (SEP)
TBY talks to Anantachai Kunanantakul, Chairman & CEO of Siam Eastern Industrial Park (SEP), on the development of the park, the benefits on offer, and plans to further develop the country's eastern seaboard.
read articleInterview
Kan Trakulhoon, Head of Working Group , Eastern Economic Corridor (EEC)
TBY talks to Kan Trakulhoon, Head of Working Group of the Eastern Economic Corridor (EEC), on the background of the EEC project, the government's push to build up infrastructure in the country, and his projections for the coming year.
read articleFocus: Water Shortage
A Drop At a Time
In 2016, many Thai's across the Kingdom will be looking out for weather forecasts—rather than economic ones—as the key indicator for the country's economic sustainability. Water is becoming an increasingly precious global commodity as populations and temperatures increase.
read articleReview: Education
Many Brains to Gain
Thailand has long suffered from an ineffective education system, with a large number of dropouts and graduates not equipped to deal with the demands of the 21st century. However, the government has been taking actions in a bid to get serious about much-needed education reform.
read articleInterview
Weerasak Kowsura, Board Chairman, Thailand Convention & Exhibition Bureau (TCEB)
TBY talks to Weerasak Kowsura, Board Chairman of the Thailand Convention & Exhibition Bureau (TCEB) & Board Chairman of Designated Areas for Sustainable Tourism Administration (DASTA), on the country's booming MICE industry and the benefits of community-based tourism.
read articleInterview
Proudputh Liptapanlop , Executive Director, Proud Real Estate
TBY talks to Proudputh Liptapanlop and Pasu Liptapanlop, Executive Directors of Proud Real Estate, on the company's development plans for Hua Hin, the prospects of the industry, and their expectations for the future.
read article