OYO Japan announced that it will be consolidating its two units – hotel units and rental value (OYO Life) to form a new single business entity. The new merged version will be simply called OYO Japan. The CEO for this new joint unit will be Ryoma Yamamoto, previously the CEO of OYO life. The entire merging process will be completed online to reduce the risk of coronavirus.
This move is a result of the coronavirus pandemic which has forced OYO Japan to take measures to accelerate its approach to overall profitability. By merging the two units OYO can reduce its sales and marketing cost, which hints towards possible layoffs as well. In addition to this, it will also make it easier for the company to build a brand name.
Moreover, OYO has been cost-cutting even before the COVID-19 pandemic started. OYO closed many of its offices in Japan, such as those in regions like Hiroshima and Omiya. The India-based decacorn is also planning to downsize its Tokyo headquarters. In addition to this, the company has been downsizing its employee base as well by transferring to laying down employees.
“This is the right time to merge operational capabilities and technology that have been built by our team in Japan. Globally, we operate a diverse portfolio of hotels, homes and rental accommodation under the umbrella of OYO Hotels and OYO homes and similarly, we are integrating both our businesses in Japan with the belief that this will strengthen our value proposition for our asset partners and guests.” an OYO spokesperson told Business Insider.
“There [have] been challenges since we landed in Japan, but in terms of opportunities it is still huge for us,” said OYO