By the end of 2005, the number of Jinjiang Inn budget hotels nationwide will rise to more than 40 from the current 14, the company said.

"We plan to develop new franchise budget hotels along the railway connecting Shanghai and Beijing," said Shu Peiling, marketing manager of Shanghai Jinjiang Inn Investment and Management Co. Ltd.

Six hotels under Jinjiang Inn's brand are currently under construction in Suzhou and Wuxi, Jiangsu Province.

The company is also in talks with hotel owners in Beijing, Tianjin and Shijiazhuang about cooperation, Shu said.

Hotels with more than 120 rooms can apply to become a Jinjiang Inn franchise through a one-time payment of 400,000 yuan (about US$48,000). The price includes management training and the use of Jinjiang's brand name and national booking system.

Shu said the company wanted to take advantage of the demand for basic hotel services from low-income travelers and avoid competition from international giants.

Since 1996, Jinjiang Inns have been providing standard rooms for 150 yuan a night at locations around the country. Occupancy of its 14 outlets is about 95 percent, the company said.

The company feels the ambitious expansion plan will improve brand awareness in other parts of the country.

"We have to strengthen our brand by attracting new investors to meet increasing competition in the hotel market," said Shen Maoxing, president of Jin Jiang Holdings.

Currently, 16 international hotel management groups are operating 36 brands in China. Longer business histories and better global booking networks have brought them substantial profits.

According to the National Tourism Administration, foreign hotel management companies operate 10 percent of China's hotels, or 15 percent of all guest rooms, but their profits already account for some 80 percent of the hotel industry's total.

(eastday.com January 17, 2003)