The Group's hotel operating strategy is interlinked with asset management because it controls the yield characteristics on the Group's asset portfolio, through driving revenues and maintaining disciplined control of costs.
Management applies sophisticated analysis, supported by technology, to achieve an optimum balance between hotel occupancy and room rates in all market conditions.
A high proportion of the Group's operating functions are de-centralised, so that local management can respond quickly to local markets. This factor also enables the Group to maintain a low level of central overhead costs.
Managed and franchised hotels form a relatively small part of the Group's business - primarily in strategically significant locations, where the Group wishes to develop and maintain a presence - for example to promote cross selling opportunities - but does not see an immediate commercial advantage in asset ownership.