L&T Infotech, Vodafone Idea, Tata Consultancy Services and several other companies have cut back on their business with SoftBank-backed Oyo Hotels & Homes for employee accommodation, people familiar with the matter at the hospitality firm, some of its former employees and hotel partners said.
These sources cited multiple issues ranging from safety and security of women to service and quality issues for these companies to scale down the business.
As a result, as well as disputes with hotel partners and frequent changes in teams, Oyo’s corporate business has stayed flat over the past one year, people familiar with matters at the company said. Oyo’s offline business, which includes the corporate segment, contributes about 18% to its total revenue, they said.
“There are a lot of issues and right now Oyo is not in a position where it can manage these issues. Corporates have cut back on business,” a former employee familiar with the matter said. “Our corporate business stayed flat last year. There wasn’t any growth and to maintain the same levels it was very hard for us to retain corporate clients.”
An Oyo spokesperson, in response to ET’s queries, however, said in the last 12 months, this business has grown 80% in revenue from a year earlier. The spokesperson also said the company had several tools in place to address customer concerns over services and safety.
In December, L&T Infotech had snapped ties with Oyo due to an incident in Pune, which in its view “compromised” the safety and security of its female employees.
In an email to Oyo, which ET has seen, L&T Infotech stated: “Over the last couple of weeks we have been getting a lot of complaints specially (from) female employees about them not being safe at Oyo hotels. We have had two such incidents in Pune which have led us to question employee safety … We as a company are liable for their safety and wellbeing when they are away for work … keeping this mind we will discontinue services to Oyo pan India in lieu of our employees’ safety and wellbeing.”
In another email seen by ET, L&T Infotech wrote: “Though the incidents happened in Pune, and pertain to one particular hotel, Oyo has not done any due diligence from their end to ensure such incidents are not repeated.” L&T Infotech did not respond to requests for comment.
“Vodafone’s corporate business for its networking division for employee accommodation to Oyo fell from about ₹25 lakh in October to about ₹11 lakh this month. This month started at about ₹17 lakh but then a cancellation came for ₹8 lakh due to service issues and since then they have not added anything,” a former Oyo employee familiar with matters said.
Vodafone, TCS and Britannia did not respond to ET’s queries till press time on Monday.
An internal email at Oyo accessed by ET shows an employee from a professional services firm had registered a complaint with Oyo about a woman staff member facing security issues at one of the hotels. The complaint said she had to lock herself in the washroom and had to call the police after midnight, as a few drunk men tried to open the door of her room and abused her. The door did not have an inside latch, the complaint alleged. She said Oyo had transferred her to another Oyo Townhouse property after she raised the complaint. The professional services firm did not respond to ET’s request for comment.
Responding to ET’s queries, the Oyo spokesperson said: “We have undertaken a series of safety measures to strengthen our guest experiences. These include an escalation matrix, in-app SOS button on check-in to intimate Oyo Safety Response Team or the Police about any emergency, in-person on-ground assistance and CCTV surveillance and security in required areas, among other things.”
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