A budget hotel aims to provide a hotel with basic necessities and they are mainly targeted to an audience who are willing to minimize their expenses. It requires you to draw a smaller amount of cash to stay in a budget hotel. They are especially designed for visitors who are willing to spend a nominal amount of money on their stay. Travelers and senior citizens are amongst the frequent visitors of budget hotel.
The budget hotels operate on a low-price model. The level of service is highly standardized and designed to suite “no-frills” convenience customers. Fiorentino (1995) identified budget hotel as “a brand new purpose-designed product concept in the hospitality industry which relies heavily on three factors; branded product concept, value for money, and service consistency”. Jones (2002) identified some of the key characteristics of a budget hotel which are mentioned below:
• Lower prices (Emphasizing the affordability factor)
• Limited facilities and services
• Targeted for the transient market
• Located on major road networks or in secondary urban locations (retail parks)
• Standardized operating procedures and rates countrywide
A survey was conducted in China to identify the critical success factors in the budget hotel segment of the industry. The researchers (Hua, Chan & Mao, 2009) identified that three factors; physical product, service quality and location were amongst the most critical success factors. ...