May 17, 2017 6:00 pm JST

Private-lodging operator eyes business travelers

Japanese vacation rental startup targets 8 million members of employee welfare company

Japanese startup Hyakusenrenma plans to open SJ Osaka Central, a private-lodging condominium with shared office, in early June, targetting business users.

TOKYO -- Private-lodging operators are turning their focus from foreign visitors to Japan to business travelers.

Hyakusenrenma, a Sendai-based startup behind vacation rental service Stay Japan, will start this month a private-lodging booking service for members of Benefit One, a major provider of employee welfare services for corporate customers.

Benefit One members will be able to book more than 560 rooms registered on Hyakusenrenma's Stay Japan via membership site Benefit Station. Customers can earn points available on a website, equivalent to a 3% discount on room charges.

Hyakusenrenma only handles legal properties, ranging from condominiums in Tokyo and Osaka, where there are not enough rooms to accommodate surging foreign visitors, to old folk houses in smaller towns. The company is hoping to lure customers other than foreign visitors by partnering with Benefit One, which boasts about 8 million members, including business customers.

Yasuhiro Kamiyama, president of Hyakusenrenma, said Japanese are less familiar with private lodgings as they are thought to be facilities for foreign travelers, who want inexpensive accommodations. The company is hoping to convey the message that its facilities are reliable via Benefit One's website.

"I hope our private-lodging customers will become repeat business travelers," said Kamiyama.

Hyakusenrenma believes it is also reassuring for owners to know that guests are Benefit One members with credible identifying information. The company expects great demand for leisure and business uses. It predicts that the tie-up with Benefit One will boost membership of its service to 23 million.

Hyakusenrenma will in June open a private-lodging facility with a shared office in Osaka, in western Japan, targeting business customers. The company also plans to hold events to provide long-term business travelers with opportunities to mingle with each other.

Airbnb has also started targeting Japanese and foreign business travelers. The U.S. online accommodation provider has enabled to search properties with a Wi-Fi connection and other business facilities. Business travelers can use them by registering their work email addresses.

The government approved the new bill, which will allow private lodgings nationwide under certain conditions, in a Cabinet meeting. Supporters hope the bill will be enacted in the current Diet session.

Airbnb alone posts nearly 50,000 private-lodging facilities across Japan, but owners rented rooms for 89 nights on average in 2016, down 12 nights from a year earlier. Lenders earned 1 million yen ($8,929) on average, down about 220,000 yen. Intensified competition has made it increasingly difficult for private lodgings to attract a broad base of customers.

Private lodgings have long been used by leisure travelers, but a growing number of business travelers are choosing to stay in private homes. Employees of more than 250,000 companies use Airbnb for business purposes, accounting for 10% of the total.

The move is in response to growing demand for sightseeing during business trips. In Europe and the U.S., business travelers choose accommodations on nearly the same standards as the ones for leisure trips. In fact, half of Airbnb's business travelers stay on Saturday nights. Private lodgings are gaining popularity as they provide customers with an opportunity to experience local culture, compared with hotels' standardized services.

Airbnb has made it possible for companies to book and pay for accommodations for employees. Employees can also settle their expenses, as receipts are also issued for bookings made by them. With growing demand for business use, Airbnb has made it easier for employees to choose private lodgings.

(Nikkei)

Benefit One Inc.

Japan

Market(Ticker): TKS(2412)
Sector:
Industry:
Commercial Services
Miscellaneous Commercial Services
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